Leading financial publisher Bloomberg News is reporting that major corporate CEO’s are refuting Republican claims that tax cuts to corporations will be reinvested in the economy and stimulate economic growth, new job creation, and higher wages.
In an article today, Bloomberg cites Cisco Systems Inc., Pfizer Inc., and Coca-Cola Co. as just three of the companies who have promised their shareholders that they will be receiving the vast majority of tax savings that the Republican tax plan is transferring to their pockets at the expense of millions of lower and middle-class taxpayers.
Instead of hiring more workers or increasing salaries of lower-paid employees, the companies’ CEO’s are on record as saying they plan to use the proceeds from the tax cuts to either buy back shares an increase their companies’s stock prices — and subsequently the value of their own stock option-laden compensation packages — or to increase dividend payouts to shareholders.
According to Bloomberg:
“Robert Bradway, chief executive of Amgen Inc., said in an Oct. 25 earnings call that the company has been “actively returning capital in the form of growing dividend and buyback and I’d expect us to continue that.'”
With recent polling showing that Americans oppose the Republican tax plan by a 50% margin, the collapse of the Trump administration’s primary argument in favor of the lop-sided corporate revenue giveaway means that if Republicans do somehow manage to convince enough Senators that a victory on the bill is essential to their political survival, they will have no cover for their blatant pandering to their corporate donors and are essentially committing political suicide by voting for it.
The Trump administration and senior Republican leaders in the Senate are counting on the force of repeated lies in the media about the actual contents of the bill and its effects on middle class taxes and the national deficit in order to forestall opposition. They aim to pass the bill in a frenzy of last minute amendments that will win over reluctant holdouts by including sweetheart provisions that are designed to overcome the skeptical Senators’ qualms about the bill before the deadline for passing it by a simple majority of Senators expires.
Meanwhile, as most corporations are rubbing their hands together in greedy glee at the prospect of an unearned windfall, a few socially conscious CEO’s are sounding the alarm at the damage that they believe that the tax cuts will inflict upon American society. As Bloomberg reports:
“Starbucks Corp. Chairman Howard Schultz, Berkshire Hathaway Inc. Chairman and CEO Warren Buffett and BlackRock Financial Management Inc. Chairman and CEO Larry Fink have all publicly criticized the legislation. Goldman Sachs Group Inc.Chairman and CEO Lloyd Blankfein said this month that with the economy at nearly full employment and growing at 3 percent, now isn’t the best time for tax cuts.
And John Bogle, founder of Vanguard Group, said Tuesday that the Republican tax plan is a “moral abomination” in part because companies will hand over the proceeds to shareholders.
“One of the flaws is that corporations are putting their shareholders ahead of the people that built the corporation,” he said at an event in New York sponsored by the Council on Foreign Relations.
If only all corporate leaders were as concerned with the future success of the nation as a whole rather than with just their corporate fiefdoms, perhaps we’d have a tax plan that equitably balanced the needs of the business world with the needs of the country’s citizens. Instead, we have the great Trump billionaire tax giveaway, just days and a few votes away from destroying the country as we know it and furthering the income divide between the richest one percent and the rest of the nation. Sad.