Layoffs

GOP Tax Law
Republicans promised American workers would see wage increases and benefits from the GOP tax scam, but six months later, that couldn’t be further from the truth. Today, CQ takes a sobering look at how the tax law is hurting – not helping – workers while wealthy shareholders are reaping the benefits. Key excerpts:
 
“Dave Breckheimer, a Kimberly-Clark electrician and union head from Wisconsin, got an unexpected call early on Jan. 31 telling him to gather his bargaining team for a meeting. He was about to learn that benefits from the biggest corporate income tax cut in U.S. history aren’t flowing to workers as promised.”

“Kimberly-Clark told his team it planned to close the 500-employee Cold Spring plant, eliminating their jobs. Breckheimer, an employee for almost four decades, couldn’t understand why the profitable company that had just received a tax cut would close plants. What he didn’t realize at the time was that Kimberly-Clark had decided a week earlier to spend $700 million to $900 million this year to buy back its own stock, benefiting the company’s investors.”

“Republicans — from President Donald Trump to Rep. Glenn Grothman, whose district contains the Wisconsin plant set to be closed — touted the cut in the top corporate tax rate as a catalyst for more jobs and bigger paychecks. But many companies are using the extra money for record levels of share repurchases, which tend to benefit top executives and the richest Americans more than average workers.”

“David Santschi, director of liquidity research at TrimTabs Investment Research Inc., says the average daily volume of buybacks this year through June 7 is $4.7 billion, which far exceeds the previous $3.2 billion record reached in 2007. It’s the highest since TrimTabs started tracking the data in 1995. Santschi says the high rate is attributable to economic expansion and the tax cut.

“‘If you look at what companies are actually doing, it’s not hiring and pay raises,’ Santschi says. ‘It’s going to takeovers and buybacks.’”

“The Kimberly-Clark plant closings will hurt the small cities where they’re located, residents say.”

“‘It was very disappointing. These are our neighbors, our friends and families,’ says Fox Crossing Village Manager Jeffrey Sturgell. ‘Everybody knows someone who works at one of the KC plants. You feel for them. You feel for their families.’”
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