Burger King's flight to Canada to beat huge U.S. corporate taxes raises a thorny predicament fort President Barack Obama, according to renowned economist and CNBC senior contributor Larry Kudlow.
Kudlow noted on "The Steve Malzberg Show" on
Newsmax TV Thursday that Obama — who strongly opposes American corporations leaving the U.S. so they could pay lower taxes — is close friends with billionaire investor Warren Buffett.
But Buffett, it turns out,
is one of the key money men in the deal which would see Burger King buying the Canadian company Tim Horton's and heading north.
"Warren Buffett is involved heavily in the financing of this issue. Buffett who is Obama's pal who has been going on for years about how wealthy millionaires don't pay their fair share," Kudlow said.
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"Here's Buffett involved in a corporate inversion, in other words, a tax deal to lighten the tax burden on Burger King and the other companies.
"Buffett kind of pulls the rug out from under Obama. Buffett's his pal and if Buffett's doing this, [so] what is Obama going to say? You attack inversions, you're attacking his buddy Warren Buffett."
Kudlow said the dilemma should make for some uneasy moments for the White House when it comes to discussing the Burger King deal.
"I want to see how this plays out because this really damages Obama's whole credibility, his whole argument and his whole economic patriotism," he said.
"This is his buddy Warren Buffett who is engaging in inversions, that's what he's doing."
Kudlow, who is also host of the syndicated program "The Larry Kudlow Show" on Cumulus Radio, also said he believes Republicans must establish a "new contract with America."
"They need to list seven or eight of these key things, including executive regulatory overreach on tax reform, on the Keystone pipeline and on Obamacare. There's a good laundry list," he said.
"The GOP needs to say to the voters, 'If you elect a Republican Senate and House here's what we'll do and here's our governing agenda'. They need a new Contract With America, it is very important.
"They could launch it this September and it would be a tremendous, tremendous thing."
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