Trump's tax cut economics a worthless exercise, GOP Congressman admits

highroller · June 25, 2019, 10:21pm

Someone has to pay so corporations do not. It’s not their country

Mountain_Soldier · June 25, 2019, 11:12pm

They’ll carve out exceptions to that figure, of course. They’ll protect their own.

Mountain_Soldier · June 25, 2019, 11:15pm

Jezcoe:

Well… it is looking like the promised investment from some companies because of the tax cut is not happening.

Bosses pocket Trump tax windfall as workers see job promises vanish | Job losses | The Guardian

AT&T’s CEO, Randall Stephenson, promised in November 2017 to invest $1bn in capital expenditure and create 7,000 new jobs at the company if Trump’s hugely controversial tax cut bill passed. Many opponents had slammed the cuts as a corporate giveaway that benefited the super-rich. But big firms lobbied for it, saying – as AT&T did – that it would fund job-creating expansions.
\The bill was voted into law in December 2017, reducing the corporate tax rate from 35% to 21%. AT&T’s benefit was a tax windfall of $21 bn and an additional estimated $3bn annually. But instead of creating jobs and increasing investment into the company, AT&T has eliminated 23,328 jobs since the tax cut bill was passed, according to a recent report by the Communications Workers of America. The CWA also said AT&T reduced their capital investments by $1.4bn.

In November 2018, GM announced it would cease operations at five plants in Michigan, Ohio, Maryland and Ontario, Canada, resulting in the loss of more than 14,000 jobs in those communities. As GM is closing plants, the company has spent $10bn since 2015 on stock buybacks, and made a net profit of over $8 bn despite paying no federal taxes in 2018. GM reported a tax windfall of $157m in the first three months of 2018 due to the Trump tax cut.

Wells Fargo, the fourth largest bank in the US by assets, tied a minimum wage increase of $15 an hour to the Trump tax cuts and pledged increased investments in workers. The company is estimated to save $3.7 bn annually due to the Trump tax cut. The bank’s 2018 tax savings were 47 times more than the costs of its minimum wage increases. Rather than invest in its workforce, Wells Fargo bought back 350 m shares in early 2018, worth about $22.6 bn, increased CEO salary by 36%, and announced plans in September 2018 to eliminate at least 26,000 jobs in the US over the next three years as many of those positions are being sent overseas.

So these large corporations that were applauded for getting a windfall did not invest like they said that they would.

Color me shocked.

The hippies over at the Library of Congress have written a white paper that concludes that the effects on wages was nominal

n the absence of the tax cuts, wages should grow with the economy and wage rates should grow as the capital stock grows. In addition, tight labor markets resulting from the approach to full employment should have put upward pressure on wage rates in any case. Evidence from 2018 indicated that labor compensation, adjusted to real values by the price indices for personal consumption expenditures, grew slower than output in general, at a 2.3% rate compared with a 2.9% growth rate overall. If adjusted by the GDP deflator, labor compensation grew by 2.0%. With labor representing 53% of GDP, that implies that the other components grew at 3.8%.34Thus, pretax profits and economic depreciation (the price of capital) grew faster than wages.

and that almost all spikes in key indicators quickly regressed back to the mean.

https://www.everycrsreport.com/files/20190522_R45736_8a1214e903ee2b719e00731791d60f26d75d35f4.pdf

GM… GM… what happened with them back around 2008-09? I’m having a hard time remembering… care to refresh my memory?

Jezcoe · June 25, 2019, 11:26pm

Mountain_Soldier:

Jezcoe:

Well… it is looking like the promised investment from some companies because of the tax cut is not happening.

Bosses pocket Trump tax windfall as workers see job promises vanish | Job losses | The Guardian

AT&T’s CEO, Randall Stephenson, promised in November 2017 to invest $1bn in capital expenditure and create 7,000 new jobs at the company if Trump’s hugely controversial tax cut bill passed. Many opponents had slammed the cuts as a corporate giveaway that benefited the super-rich. But big firms lobbied for it, saying – as AT&T did – that it would fund job-creating expansions.
\The bill was voted into law in December 2017, reducing the corporate tax rate from 35% to 21%. AT&T’s benefit was a tax windfall of $21 bn and an additional estimated $3bn annually. But instead of creating jobs and increasing investment into the company, AT&T has eliminated 23,328 jobs since the tax cut bill was passed, according to a recent report by the Communications Workers of America. The CWA also said AT&T reduced their capital investments by $1.4bn.

In November 2018, GM announced it would cease operations at five plants in Michigan, Ohio, Maryland and Ontario, Canada, resulting in the loss of more than 14,000 jobs in those communities. As GM is closing plants, the company has spent $10bn since 2015 on stock buybacks, and made a net profit of over $8 bn despite paying no federal taxes in 2018. GM reported a tax windfall of $157m in the first three months of 2018 due to the Trump tax cut.

Wells Fargo, the fourth largest bank in the US by assets, tied a minimum wage increase of $15 an hour to the Trump tax cuts and pledged increased investments in workers. The company is estimated to save $3.7 bn annually due to the Trump tax cut. The bank’s 2018 tax savings were 47 times more than the costs of its minimum wage increases. Rather than invest in its workforce, Wells Fargo bought back 350 m shares in early 2018, worth about $22.6 bn, increased CEO salary by 36%, and announced plans in September 2018 to eliminate at least 26,000 jobs in the US over the next three years as many of those positions are being sent overseas.

So these large corporations that were applauded for getting a windfall did not invest like they said that they would.

Color me shocked.

The hippies over at the Library of Congress have written a white paper that concludes that the effects on wages was nominal

n the absence of the tax cuts, wages should grow with the economy and wage rates should grow as the capital stock grows. In addition, tight labor markets resulting from the approach to full employment should have put upward pressure on wage rates in any case. Evidence from 2018 indicated that labor compensation, adjusted to real values by the price indices for personal consumption expenditures, grew slower than output in general, at a 2.3% rate compared with a 2.9% growth rate overall. If adjusted by the GDP deflator, labor compensation grew by 2.0%. With labor representing 53% of GDP, that implies that the other components grew at 3.8%.34Thus, pretax profits and economic depreciation (the price of capital) grew faster than wages.

and that almost all spikes in key indicators quickly regressed back to the mean.

https://www.everycrsreport.com/files/20190522_R45736_8a1214e903ee2b719e00731791d60f26d75d35f4.pdf

GM… GM… what happened with them back around 2008-09? I’m having a hard time remembering… care to refresh my memory?

They struck a deal with the Government that screwed over the bond holders in order to remain solvent from the economy that was in free fall.

I am not sure what your point is trying to be.

madasheck · June 25, 2019, 11:32pm

Prove the story is wrong. In detail.

markdido · June 26, 2019, 2:33am

Trump’s tax cut economics a worthless exercise, GOP Congressman admits

Goalposts heavy?

I’m questining your thread title.

Post a link to this exact quote please.