Jobs to China

Good to see that you're in China perpetuating the very problem that will eventually destroy your GDP along with your Balance of Payments and eviscerate your nation's tax base. More or less guaranteeing insufficient domestic employment (or income for those still in a job) achieved through international Arbitrage of wages and leading to loss of domestic demand from an impoverished market and reduced services and infrastructure due to falling domestic tax revenues. You may enjoy the short term increase in profits by adding a few percent of value to finished products while adding nothing to the domestic manufacturing base - basically you're financialising (latest economic buzz word) - that is creating nothing but "soft" money. The problem with that is it doesn't create any local domestic wealth outside the transaction - so no "trickle-down. Leading to such anomalies as fictional increased GDP as total cost is included in the sales number while most of the money resides overseas along with the jobs. While this makes corporate profits look better it does, evidently, lead to poverty, strikes and riots.

The Chicago School is the major originator, ideological prothletiser and defender of Neoconservative Economic Theory and Free-Market Capitalism in general. It dabbles in manifold mathematical models which will provide any answer you want in order to prove itself correct. It has been the most influential economic model (monetarist, monetarism) of the past 40 years. Largely the product of the University of Chicago Economics Department this school of economic fundamentalist thought gained influence during the 1970s particularly through the scribbling of a professor Milton Friedman (Nobel Prize in economics for the theory of the "Natural Rate of Unemployment" and advisor to General Pinochet shortly after Pinochet had the elected guy in power painfully terminated). The gist of it is that - government regulation of an economy creates monopolies thus - markets are more efficient at allocating resources than government so -  government has no business managing aggregate demand leaving - government's only job is to maintain a constant, low, rate of money supply growth.  This school's greatest influence has been relatively short  - since Maggie and Ronnie - but dominant since the fall of the Soviet Union and capitalism declared unconditional victory. Sadly it hinges on total transparency in the market provided by self-regulation. So, even more sadly, as a result it doesn't work.

Your Enterprise minister guy has just complained that not enough businessmen care sufficiently about achieving a reduction in Corporation tax - even though no company with a decent tax accountant pays much of it anyway. He should consider that, just possibly, the electorate don't want companies to pay any less tax than at present - frightening thought it is for a corporatist to grasp that the majority of voters don't support higher corporate profits bereft of an accompanying and demonstrative benefit to them.

If investment in R&D doesn't provide the tax-payer that funded it with any benefit why should they spend the money on something that translates into overseas jobs and untaxed corporate profits? I'd like to know your justification for using public money to enhance jobless corporate expansion.   The present correlation between corporate profit and employment is one of higher unemployment and lower or stagnant wages - what are the chances of reversing this by lowering corporate taxes?