Morning Brief: Romney's China Policy

In the Wall Street Journal, Republican presidential candidate and former Massachusetts Governor Mitt Romney writes that China's embrace of state-capitalism and political repression should not become a model for the world. A Romney administration would likely deem China a "currency manipulator," increase the U.S. military presence in the Asia-Pacific, and confront Beijing over human rights.

Just one day after meeting with Chinese Vice President Xi Jinping (FT), U.S. President Barack Obama told voters in Milwaukee that his administration and its new trade enforcement unit would focus on ensuring Beijing played by the rules. Meanwhile, Vice-President Xi traveled to Iowa to emphasize his country's imports from the region and address criticisms of Chinese economic policies.

This CFR Policy Innovation Memorandum, “Fostering Greater Chinese Investment in the United States,” looks at what the United States should be doing to attract greater foreign investment from China.

International trade and investment. Read more from leading analysts on the debate over next steps in U.S. trade policy.

Infrastructure

'Intelligent Reforms' for U.S. Infrastructure

For Bloomberg, Edward Glaeser says the $476 billion in transportation spending proposed in the 2013 White House budget is not the answer to what ails U.S. infrastructure. The country need "intelligent reforms," he notes, "not floods of extra financing or quixotic dreams of new moon adventures or high-speed railways to nowhere." He offers several ways to improve U.S. transportation including: congestion pricing, an increased role for states and localities, more public-private partnerships, and embracing bus transport.

The House transportation bill—the American  Energy and Infrastructure Jobs Act—is an obstacle to job creation, writes Anastasia Christman for the Hill. Rather than focusing on automobile-only projects, an effective bill would emphasize public transit that creates roughly 50 percent more jobs for the same investment, she says.

Infrastructure. Read more on how upgrading the nation’s aging network of roads, bridges, airports, railways, and water systems is essential to maintaining U.S. competitiveness.

Corporate Regulation and Taxation

Moving to a Territorial Tax Regime

The United States should adopt a territorial corporate tax system that assesses taxes at rate equal to the ratio of a company's worldwide sales to its domestic sales, writes Bill Parks in the Hill. The reform would not only require highly-successful U.S. multinationals to pay a fair tax bill, but would also equitably tax foreign businesses operating in the U.S. that may currently elude Uncle Sam altogether. The Obama administration is expected to propose changes to U.S. corporate tax rules within the next month

CFR’s recent Independent Task Force on U.S. Trade and Investment Policy, chaired by Thomas Daschle and Andrew Card, recommended corporate tax reform based on three principles: reduction of the statutory corporate tax rate; adoption of a territorial tax system; and the creation of a value-added tax.

Corporate regulation and taxation. Read more from top economists and business experts on solutions for addressing corporate tax reform.