Trump Tax Law Breaks Republican Promises, Trump Continues Leaving Workers Behind
August 13, 2018
Big banks, CEOs and the wealthiest Americans are the big winners of the Trump tax law as they reap billions in profit. Meanwhile, real wages for workers have actually decreased over the past year as costs of living rise. It’s clear why Republicans have abandoned running on Trump’s agenda – Trump is leaving workers behind.
Big banks are big winners from the Trump tax law. They profited a total of $56 billion in the first three months of 2018 alone, including billions in new tax breaks.
Vox: “Even without the Republican tax cuts, United States banks would have made $49.4 billion in the first three months of 2018 alone. But thanks to their reduced tax bill, they got an extra $6.6 billion, bringing in $56 billion in total. And there are plenty of signs the banking industry’s tax-bill boom is on track to continue — take Bank of America, which saw its tax bill fall to $1.7 billion in the second quarter of this year from $3 billion last year, a 43 percent drop.”
CEOs have used their massive corporate tax cuts to enrich themselves and their wealthy investors, not their workers.
New York Times Editorial Board: “The most notable outcome of the tax law is one that few Republicans talked about: Companies are buying back their own stock — a lot of it. Stock buybacks are expected to reach a record $1 trillion this year.”
New York Times Editorial Board: “Share buybacks have an understandable appeal to executives, many of whom are compensated with stock themselves, and to investors. But buybacks do little for workers, most of whom own little or no stock.”
The Trump administration issued new tax rules that could allow Donald Trump and millionaires to benefit even further from the Republican tax breaks.
New York Times: “A new 20 percent tax break included in last year’s $1.5 trillion tax overhaul could wind up benefiting President Trump’s real estate empire given how the Treasury Department plans to implement the provision, several tax experts said.”
Forbes: “Treasury Redefines Tax Cut Restrictions To Give Wealthy Even More Breaks.”
The Trump tax law has not led to increased business investment as Trump and Republicans promised.
New York Times Editorial Board: “With so much of firms’ focus on buying back stock, a key Republican prediction — that tax cuts would encourage spending on equipment and factories — has not come to fruition.”
Workers have not benefited from the Trump tax law and real wages for workers have actually declined.
New York Times Editorial Board: “And what happened to that promise of a big raise for workers? No sign of it yet. The typical family would earn $3,000 to $7,000 more a year, the White House Council of Economic Advisers said. In fact, real wages are down, largely thanks to the rising price of oil, which has more than offset any modest increase in income.”
It’s clear why Republicans have abandoned running on the Trump tax law and will struggle to run on Trump’s agenda: Trump is leaving workers behind.
New York Times Editorial Board: “Today, many Republicans seem to realize that the tax cut has become a political liability, which is why they aren’t talking about it ahead of the November election. Even they realize that it doesn’t do any of what they promised.”
Forbes: “In the past few days, new economic reports have come out that don’t paint a very rosy picture for a number of economic items. While GDP hit 4.1% for the June quarter, but only 2.9% year over year, and the unemployment rate is hovering at all-time lows, inflation continues to increase, real wages are stagnant and the federal budget deficit is ballooning.”