From: Doug Logan
Columbus
I pointed out in a recent letter that, far from trickling down to the likes of you and me, the Republican tax cut scam is only helping the rich get richer. The basic trick in the scheme is that corporate bigwigs use the increased profits — the money that used to be taxes — to buy back their companies’ stock. That increases the stock price because the value of the corporation is divided over a smaller number of shares.
Then comes the sneaky part: corporate big shots get stock options, the chance to buy stock at a discounted price that they then turn around and sell at the tax-cut-funded higher price. The cuts do not pay for business growth or new jobs; the lost tax revenue goes smoothly into some executive’s pocket.
Here is another result of the buyback craze. Corporations are starving employee pensions. A Market Watch article Oct. 20 named five corporations with underfunded pensions. American Airlines for example, spent more than $10 billion on stock buybacks and less than $3 billion in pension contributions. So American’s pensions are only about 62 percent funded. That’s the lowest percentage named, but the other named corporations are no more honorable. General Electric spent more than $35 billion on buybacks, but could only spare $10 billion for its pensions.
So here is a difference between the parties that you can use in making your choices this year. This matters because the Republicans promised you more. Republican candidates two years ago promised you tax cuts and better, cheaper medical insurance. Instead, rich people got tax cuts and you get less medical protection. Sure, Democratic candidates may have faults, but we are more likely to get policies that benefit voters from them than we will from the Republicans.
Ask the Republican candidates. Mitch McConnell thinks we have to cut Social Security and Medicare. Ask Mike Braun how many people he has hired or how much more he pays employees since he got his tax cut. Ask Greg Pence what he stands for, if you can find him.
