This is probably the stupidest thing I’ve heard him say. Someone should tell him that it’s possible to acquire shares in exchange for tax money.
You really don’t need to read further than this: “Shares are permanent wealth, whereas taxes are transitory income.” My eyes wanted to puke a little just reading that.
Let’s look a public MNCs first: if the government wants to spend tax money on shares in US MNCs, they can already do it. No advantage here. And the MNCs who have an Irish tax liability probably have decent cash stores outside the US and would prefer to give us €€ rather than shares. It’s a stupid idea for public companies.
Now let’s look at this applied to private companies. What McWilliams seems to be suggesting is that we give up tax in exchange for untraded, illiquid shares in MNCs. In other words, give up a liquid asset in exchange for an illiquid one, that we cannot use to pay public servants, or pensions. So we would need to borrow even more in order to invest in these companies. In other words, we’d be borrowing from the bond markets in order to invest in tech stocks.
And we wouldn’t even be able to direct these investments; presumably only companies that were profitable, with a tax liability, but with no free cash would give us shares. We’d be stuck with a random assortment of stocks in MNCs, some of which would never be liquid.
Does McWilliams forget that only a short time ago we had no money to pay salaries, and no ability to borrow that money? And now he’s advocating that we borrow even more to speculate on tech and pharma stocks. Jesus.