There are several approaches to corporate inversions, including the kind of vicious but otherwise empty class warfare rhetoric to which we have become all too accustomed over the last seven years and new tax policies that actually address the issue.

An editorial in today's Wall Street Journal points out that Hillary Clinton, the Democratic nominee, is going for the former, while Donald Trump, the Republican nominee, is going for the latter–though with fewer details than we might want:

“Corporations should not abandon profitable operations here in the United States to move abroad, just to give shareholders a quicker return, CEOs a bigger bonus and unions a weaker hand to play,” Mrs. Clinton said in her Michigan economic speech on Aug. 11.

. . .

The Democrat would impose what she calls an “exit tax” on businesses that relocate outside the U.S., which is the sort of thing banana republics impose when their economies sour. She’d conduct a census and then categorize any multinational with more than 50% U.S. ownership as a domestic concern that would be subject to a tax on its deferred profits if it inverts. She isn’t specifying the punitive tax rate.

. . .

By the way, Mrs. Clinton says she’ll use the proceeds of the exit tax to fund what she calls the greatest “investment” in roads, bridges and airports since World War II. But she also says the exit tax will deter inversions, which means it wouldn’t raise much money. Which is it?

U.S.-based companies have about $2 trillion parked in foreign subsidiaries. Mrs. Clinton wants to change the rules retroactively to take a government cut from this overseas cash pile. Mr. Trump may want to build a wall to prevent immigrants from coming to America, but Mrs. Clinton wants to build a tax wall to stop Americans from escaping. “If they want to go,” she threatened in Michigan, “they’re going to have to pay to go.”

First of all, giving shareholders a good return is a laudable ideal–even if Mrs. Clinton tries to make it sound shady by using the word "quick." Shareholders aren't just fat cats (such as the ones Mrs. Clinton hung out with at glittering parties last weekend) but are also people like you and me who are saving for retirement.

Second, the idea of holding companies captive is shocking and an affront to the idea of economic freedom.  Many U.S. corporations will come up with creative solutions (49 percent U.S. ownership?), but this attempting to trap companies will only make the U.S. a less hospitable place to do business–and, yes, will cut into profits that should go to shareholders like you and me.

Mrs. Clinton also ignores the reason these companies opt to do business abroad: a punitive U.S. corporate tax. Too busy peddling junk science on Mrs. Clinton's health, Donald Trump can't be bothered with the issues. But his plan is reality based: the U.S. has the highest corporate tax in the world (35 percent). His plan is to cut it (15 percent).

The editorial explains:

The U.S. system of world-wide taxation means that a company that moves from Dublin, Ohio, to Dublin, Ireland, will pay a rate that is less than a third of America’s. A dollar of profit earned on the Emerald Isle by an Irish-based company becomes 87.5 cents after taxes, which it can then invest in Ireland or the U.S. or somewhere else. But if the company stays in Ohio and makes the same buck in Ireland, the after-tax return drops to 65 cents or less if the money is invested in America.

Mr. Trump proposes to cut the U.S. corporate rate to 15% from 35% (or 40% counting average state rates). Fifteen percent is low enough to deter inversions while making the country more attractive to capital investment and better primed for higher wages. He would also offer a preferential rate of 10% for the $2 trillion already earned overseas.

There is much research to indicate that lower corporate taxes lead to higher wages for workers. But the Republican nominee appears more committed to being a colorful personality than discussing these issues.