Corporations are embarrassing Republicans in Congress after GOP lawmakers promised massive new investments from corporations if their tax bill became law. According to the Federal Reserve Bank of Atlanta, 75 percent of firms surveyed said they are making “no material changes” to their planned 2018 investments due to the tax bill.
Republicans are increasing the national debt by more than $1 trillion, and not even 1 in 4 companies are investing in job creation activities.
When the bill passed the House of Representatives, Rep. Mimi Walters (R-Irvine) boldly promised the Republican tax bill would “lower rates for job creators in order to increase economic growth and create opportunities for all Americans.” But that’s not what companies are doing. Not even close.
Rather than make investments in areas that could spur more jobs for Main Street, corporations are focused on keeping Wall Street investors happy.
“American companies have lavished Wall Street with $171 billion of stock buyback announcements so far this year,” according to analysis by research firm Birinyi Associates. While workers and consumers don’t benefit from these activities, Axios reports the money “is enriching hedge funds, other Wall Street investors and top drug company executives,”
But companies aren’t doing that. Instead, they may decide to take advantage of the provisions in the Walters- and Knight-supported bill to ship jobs overseas. The bill contains a loophole that “encourages multinational corporations to artificially shift their profits offshore, or even shift real investments and jobs offshore, to avoid paying taxes.”
While Knight and Walters are showering their Wall Street donors with corporate giveaways, Californians are stuck paying the tab.
Next year, Californians will make up 11 percent of the U.S. population, and will be forced to pay 17 percent of federal income taxes. As one California Republican admitted, “almost all of the bill’s tax cuts would be distributed to other states — leaving California with the bill.”
No wonder more than 60 percent of Californians don’t like the bill.
Republicans made a promise to the American people: drastically lowering taxes for corporations would substantially spur investment and growth.
That’s just not happening.