A recent Bloomberg story provides even more proof of how our nation’s economic system is rigged toward the wealthy and powerful, and how President Donald Trump’s 2017 tax cuts continue to bolster wealthy interests at the expense of workers.
The headline of the story, “Banks Reaping $21 Billion Tax Windfall Cut Workforce,” reads like a joke. Bloomberg reports that major U.S. banks enjoyed a mighty windfall from the Trump tax overhaul, yet still cut thousands of staff – with thousands more jobs on the chopping block – and tightened lending.
These two paragraphs from the story drive home the point about reduced taxes and increased layoffs:
“Major U.S. banks shaved about $21 billion from their tax bills last year – almost double the IRS’s annual budget – as the industry benefited more than many others from the Republican tax overhaul. …
While banks vowed to use a portion of their savings to reward employees, help needy communities and support small businesses, the magnitude of their break and how the money was divvied is likely to fuel debate over whether the law was an effective way to stoke the economy. The 23 firms boosted dividends and stock buybacks 23 percent, and they eliminated almost 4,300 jobs. A few have signaled plans to cut thousands more.” (Emphasis ours).
The story puts the banks’ tax boon in even context: “The amount saved by banks is greater than NASA’s request for fiscal 2019, which would cover deep space exploration, orbital operations and other research. It’s more than double what the Federal Bureau of Investigation expects to spend fighting crime.”
General Motors’ recent layoff announcement highlights the same, troubling trend: big corporations reap huge profits (thanks in large part to lower taxes) while slashing jobs. It only reinforces the fact that corporate tax cuts don’t actually help workers.
Corporations are able to get away with such behavior because of anti-worker policies pushed by the Trump administration and its allies on Capitol Hill and also because only a small number of American workers have a voice on the job by forming unions. There’s no secret to solving our country’s unprecedented wealth gap and to rebuilding the middle class: make it easier for working people to come together and organize in a union.