In an apparent quid pro quo last year, Rangel killed a tax bill that would punish U.S. companies for relocating to lower-tax countries after a CEO pledged $1 million for the future "Charles B. Rangel School of Public Service" at the City College of New York. Previously, Rangel had supported the bill.
With this latest addition to Rangel's growing parade of questionable dealings and laughable excuses—his failure to pay taxes on $75,000 in rental income from his luxury Caribbean beach villa; his gaming of D.C. housing tax credits; his remarkable procurement of four rent-controlled apartments in Harlem; his fundraising appeals for his academic shrine on government letterhead—some Republicans, such as House Minority Leader John Boehner, have renewed their calls that Rangel be stripped of his chairmanship. That seems appropriate. Less helpful, however, is the response from Senate Republican Charles Grassley, who demanded that the "loophole" that allows companies to relocate be "closed."
The irony of it all is that in doing the wrong thing, Rangel inadvertently did the right thing. The U.S. tax rate on corporate income is the second highest in the world. And while other developed countries—Great Britain, Germany, Ireland—are busy slashing their rates to attract more businesses, President-elect Obama has proposed raising these tax rates even higher. Extracting more blood from fewer donors isn't a healthful prescription, particularly during a recession.