To meteorologists, an inversion is a deviation from the normal change of an atmospheric property. It can lead to pollution and adverse health effects. To Wall Street dealmakers, and now to most boards of directors, an inversion is a cross-border merger that allows the buyer to reincorporate in a more tax-friendly jurisdiction. It can lead to pollution of the hot air emitted in the Congress, and adverse effects on the health of the U.S. Treasury. And most of all, to big tax savings. The merging parties pay lip service to the idea that such deals produce companies that are efficient at more than reducing their tax bills, but that is because they want to appear skilled industrial strategists rather than the tax avoiders (not evaders) they really and legally are.

This tactic received maximum publicity during Pfizer’s failed attempt to take over Britain’s AstraZenica, with the result that no board of directors of an American company can fail to explore the possibility of a tax inversion: do it or have a very good reason to offer to shareholders for not doing it. That’s because our corporate tax rate, at 35 percent, is the highest in the world (not counting countries where de facto tax payments, also known as bribes, are not included in the official rate). And because America uniquely does not tax profits earned overseas until they are brought home. So do a tax inversion deal, lower your effective tax rate to increase shareholder returns, and bring cash home at advantageous rates. Very tempting, although for companies that can use a variety of features in the complex U.S. tax code to keep their effective rate—what they actually pay—below the 35 percent rate, less attractive than for others.