My heart aches for underpaid working doormats who believe they wouldn’t have a job if their company had to pay more federal taxes. But now, the Institute for Policy Studies (IPS) clears up that misunderstanding. They just published a report that reveals corporate tax cuts have nothing to do with job creation — there is no correlation, at all!
Well, except for the one correlation with increased CEO pay.
Meanwhile, it is the demand side of the economy that creates jobs. That’s you and me. The higher our wages, the more we demand — in products and services. Then in order to supply an increasing demand for their products and services, companies need to hire more workers.
Corporate Tax Cuts Don’t Create Jobs | Bernie Sanders
“A new Institute for Policy Studies analysis of major US corporations paying less than 20 percent of earnings in federal corporate income taxes shows that more than half cut jobs since 2008 and increased CEO pay to more than $13 million. Among the companies that slashed jobs? Well their CEOs made more – $15 million.” ~ Sen. Bernie Sanders
For a quick read, Sarah Anderson outlines the key findings in the August 30th IPS report on corporate tax cuts:
“House Speaker Paul Ryan is proposing to cut the statutory federal corporate tax rate from 35 to 20 percent. President Trump wants to slash the rate even further, to just 15 percent. Their core argument? Lowering the tax burden will lead to more and better jobs.
To investigate this claim, this report is the first to analyze the job creation records of the 92 publicly held U.S. corporations that reported a U.S. profit every year from 2008 through 2015 and paid less than 20 percent of these earnings in federal income tax. Did these reduced tax rates actually lead to greater employment within the 92 firms? The data we have compiled give a definitive — and sobering — answer…”
You may read the full report for yourself: Corporate Tax Cuts Boost CEO Pay, Not Jobs | Institute for Policy Studies
Be aware. Be objective.