To escape the developed world’s highest corporate tax rate, U.S. companies have sought to change their corporate “citizenship” by purchasing foreign partners and merging into them—called an inversion. While the Obama administration has tried to deter inversions, the benefits of avoiding U.S. corporate taxation are so great that foreign companies are now buying up American companies instead. Joe Kennedy writes in the Wall Street Journal that the pharmaceutical industry illustrates both the need for effective tax reform and the futility of piecemeal solutions.
