The Trump Tax Cut Isn't Trickling Down to Workers
Walmart was one of several companies touting bonuses  but other companies have laid off workers.  Trump  photo by Alex Wong/Getty  Walmart photo by Patrick T. Fallon/Bloomberg via Getty
 Donald Trump  spent a good portion of  his  Tuesday night State of the Union speech celebrating the American economy  and  his  tax cuts in particularâwhich  he  falsely called the âbiggest in history.â It was a big cut  however  and also the most significant piece of legislation passed by the Republican-dominated Congress in 2017. Unsurprisingly  the largest beneficiaries of this bill were the wealthy and corporations. Whatâs unclear  however  a little more than a month after the bill has passed  is how exactly this new cash influx will be spent.
 Trump  and  his  Republican allies want people to think that the bill will be a boost to workers. The passage of the cuts was quickly followed by a slew of corporate press releases  more than 70 in all  announcing employee bonuses. Walmart gave âeligible associatesâ (meaning longtime workers) a cash bonus of âup to $1 000 â Apple gave employees $2 500 in restricted stock  and Disney gave $1 000 cash bonuses to 125 000 (out of 195 000) employees. In every case  corporations explicitly tied bonuses to the tax cut; Disney actually corrected a press release to emphasize the link.
That all added up to a massive PR campaign on behalf of the cuts that elided all of the billâs negative consequences  like the decision by Kleenex maker Kimberly-Clark to use its tax windfall to fund a plan that included laying off 5 000 workers. And itâs not clear that the cut directly led to the bonuses or if the companies just credited Trump in order to garner goodwill from the administration. In AT&Tâs case  the telecom giant said it had given out $1 000 bonuses because of the tax cuts when actually it was pushed into handing out money by a union representing its workers.
According to those in favor of the tax cut  that would indeed be a way firms will use their tax breaks  and that could lead to more jobs. These wonât be the manufacturing jobs that Trump is so fond of  however. âThat labor is skilled labor  people who can do research  people with doctoral degrees â said Fich. âThat means maybe a little uptick on employment  but not the blue-collar workers. It might not even be your four-year-college-educated individuals.â
The biggest one was that  ironically  more companies kept even more cash offshore following the holiday. The mindset was simple: We missed the first holiday  so might as well wait until the next. But another effect hinted at what companies would do with an influx of money. Just as they've done immediately after the Trump tax cut  rather than invest in creating jobs they bought back debt and shares. (One study found that 94 cents of every dollar brought back went to share buybacks and dividends.)
Walmart was one of several companies touting bonuses  but other companies have laid off workers.   [TGT] photo by Alex Wong/Getty   [TGT] 
spent a good portion of   [TGT]   Tuesday night State of the Union speech celebrating the American economy  and   [TGT]   tax cuts in particularâwhich   [TGT]   falsely called the âbiggest in history.â It was a big cut  however  and also the most significant piece of legislation passed by the Republican-dominated Congress in 2017. Unsurprisingly  the largest beneficiaries of this bill were the wealthy and corporations. Whatâs unclear  however  a little more than a month after the bill has passed  is how exactly this new cash influx will be spent.
  [TGT] and   [TGT]   Republican allies want people to think that the bill will be a boost to workers. The passage of the cuts was quickly followed by a slew of corporate press releases  more than 70 in all  announcing employee bonuses. Walmart gave âeligible associatesâ (meaning longtime workers) a cash bonus of âup to $1 000 â Apple gave employees $2 500 in restricted stock  and Disney gave $1 000 cash bonuses to 125 000 (out of 195 000) employees. In every case  corporations explicitly tied bonuses to the tax cut; Disney actually corrected a press release to emphasize the link.
That all added up to a massive PR campaign on behalf of the cuts that elided all of the billâs negative consequences  like the decision by Kleenex maker Kimberly-Clark to use its tax windfall to fund a plan that included laying off 5 000 workers. And itâs not clear that the cut directly led to the bonuses or if the companies just credited  [TGT]  in order to garner goodwill from the administration. In AT&Tâs case  the telecom giant said it had given out $1 000 bonuses because of the tax cuts when actually it was pushed into handing out money by a union representing its workers.
According to those in favor of the tax cut  that would indeed be a way firms will use their tax breaks  and that could lead to more jobs. These wonât be the manufacturing jobs that  [TGT]  is so fond of  however. âThat labor is skilled labor  people who can do research  people with doctoral degrees â said Fich. âThat means maybe a little uptick on employment  but not the blue-collar workers. It might not even be your four-year-college-educated individuals.â
The biggest one was that  ironically  more companies kept even more cash offshore following the holiday. The mindset was simple: We missed the first holiday  so might as well wait until the next. But another effect hinted at what companies would do with an influx of money. Just as they've done immediately after the  [TGT]  tax cut  rather than invest in creating jobs they bought back debt and shares. (One study found that 94 cents of every dollar brought back went to share buybacks and dividends.)