A Wave of Corporate Propaganda Is Boosting Trump’s Tax Cuts

https://www.thenation.com/article/a-wave-of-corporate-propaganda-is-boosting-trumps-tax-cuts/


By Joshua Holland
February 23, 2018

Three major business groups alone—the US Chamber of Commerce, the National Association of Realtors, and the Business Roundtable—spent $56 million in the last three months of 2017 lobbying Congress to give them a massive tax cut. According to Public Citizen, 6,243 lobbyists—more than half of the total number of active lobbyists in DC—worked on the bill, which works out to 11 for each and every lawmaker in Congress.

For their effort, they got massive, permanent cuts to the corporate-tax rate. Republicans had talked about closing loopholes so that their cuts wouldn’t blow up the deficit, but that fell by the wayside, and in the end we’ll mostly be financing this huge giveaway through public debt.

Now many of the corporations that lobbied for the bill are trying to make what began as a historically unpopular law more palatable with a series of high-profile announcements crediting the tax cuts for investments that they’d already planned to make or touting one-time bonuses for workers.

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Disney made headlines when it announced that it would give 125,000 theme-park workers a $1,000 bonus as a result of the cuts, but now the company is threatening to withhold those payouts from its unionized workers if they don’t accept an offer for a new contract with a 50-cent hourly wage increase—an offer the union rejected in December.

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An analysis by Morgan Stanley earlier this month found that “only 13% of companies’ tax cut savings will go to pay raises, bonuses and employee benefits,” while “43% will go to investors in the form of stock buybacks and dividends.” That’s a very different picture than the one being painted by companies like Walmart, ExxonMobil, and Disney.

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There’s a reason businesses are eager to tout purported benefits of the tax law for workers. “They know that the American public is deeply opposed to giving big tax breaks to corporations,” says Frank Clemente, executive director of Americans for Tax Fairness, says. “Everything the business community does in the normal course of business is going to be spun as a result of the tax breaks because they were reading the same polls that we were reading, and they knew that they needed to change this dynamic.”

The tax bill itself incentivized companies to announce bonuses right away. Because of a quirk written into the law, corporations could deduct bonuses if they announced them in 2017, but not if they offered them—or higher wages—in 2018.

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