The Telegram & Gazette of Worcester (Mass.), March 12:

Last year, the Obama administration directed the Treasury Department to draft new rules to make it more difficult for U.S. companies to pull off tax-inversion deals, under which they would acquire a foreign company, and then “redomicile” the new, merged company overseas.

By doing so, corporations were able to take advantage of lower overseas tax rates, thus saving money for their shareholders. But those gains came at a cost to the nation’s coffers, as less tax revenue would come in.

At the time, many observers warned that Uncle Sam was treating the symptoms, and that what was really needed to curb inversions was reform of the U.S. business tax code, including lower corporate tax rates.

What Uncle Sam apparently did not foresee was what every corporate lawyer began working on the moment the new rules were passed ”“ new ways to evade the tax man.

It turns out that instead of making inversion deals with U.S. companies, foreign competitors are taking a more direct route: They are simply acquiring U.S. companies, transferring assets, and applying the lower tax rates that prevail overseas to their earnings in the U.S.

Foreign takeovers doubled in 2014 compared to the year before and are still going strong, meaning less tax revenue for Washington.

The news isn’t all bad. Foreign investment, after all, means that those outside the U.S. still want to be stakeholders here. And plenty of U.S. companies continue to buy overseas firms.

But if Washington wants to compete in the sense of ensuring a steady flow of tax revenue, it will have to do what the Treasury already recognizes as necessary: Reform the U.S. corporate tax code.

Of course, that will take an act of Congress. No easy feat these days.