Sen. Olympia Snowe, as dainty as she looks, is really tough to push around.

She demonstrated her doggedness again Friday by standing firm on the tussle over federal tax cuts. The president favors a 10-year $726 billion tax cut, which he believes will plunge money back into the struggling economy.

Snowe argued that size cut is too extreme and would hurt, not help.

She won.

Republican leaders have promised that any tax cut bill sent to the White House for the president’s signature won’t exceed $350 billion over the next decade. So, tax relief on corporate dividends is off the table. That is, unless Congress can find a way to offset those cuts with additional taxes or by stitching tax loopholes closed.

Raising taxes would be poor policy on the heels of such tremendous tax cuts.

Closing tax loopholes is work that must be done anyway, even without the promise of corporate dividend relief.

The United States loses billions of dollars a year as corporations doing business in this country go offshore to reincorporate , with seemingly little more effort than opening a post office box in Bermuda.

Governments – federal, state, county and local – are struggling to make ends meet because revenues are down. Citizens are struggling to pay tax bills because the cost of services continues to rise.

Instituting massive tax cuts is not enough to right the imbalance. Government must even the tax burden, which means Snowe-style tenacity about tax dodgers.

Ingersoll-Rand, with headquarters in New Jersey, reincorporated in Bermuda in 2001 and saved $60 million in taxes in 2002. The company – which has nearly 300 contracts with the Navy, Army, Air Force, Department of Energy, Department of the Treasury and the General Services Administration – is sticking it to taxpayers in favor of shareholder profits.

It isn’t alone.

Accenture, which folks may recognize as Andersen Consulting of the former Arthur Andersen, reincorporated in Bermuda in 2001. This management and technology consulting firm has over $1 billion in federal contracts and denies moving to Bermuda for the tax break. Instead, it was a decision based on the island’s neutral status that appeals to its American, European and Asian clients.

That it gets a much-reduced tax bill certainly sweetened the move and the company pays a stable of lobbyists to protect its tax-haven status.

These are two examples; there are hundreds more hustling some $70 billion in tax revenue out of this country every year.

And we permit it. The government is not prohibited from awarding contracts to tax cheats. Instead, it is allowed to do so.

It is obscene that government -our representatives – is using our money to buy services from companies that have no compunction about cheating us.

It’s a violation of public trust and has to stop.

The thrust behind the recently approved federal tax cuts is to free up spending money. A $350 billion tax cut over 10 years will do that. We could free much more money, though, by recapturing $70 billion in lost tax revenue every year. In 10 years’ time, that new revenue would be much more valuable than the tax cuts.

And, if we can’t collect the wayward taxes, we must stop buying services from the cheats.
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