Republican Tax Bill

Floor Speech

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Mr. SCHUMER. Mr. President, finally, on the tax bill, I just note that, once again, every day the more people learn about this tax bill, the more they don't like it. Stock buybacks continue at a hugely rapid rate. Aid to workers is much, much smaller, and the American people are learning this bill was of, by, and for the wealthiest Americans and the most powerful corporations. That is wrong. We welcome the debate on the tax bill because the more people learn about it, the more they don't like it.

Since the beginning of the tax debate, Republicans have insisted their bill is about cutting taxes for working Americans. Even though the bill would direct 83 percent of the benefits to the top 1 percent, Republicans said workers were the focus. Even though they made corporate tax cuts permanent but let the individual tax cuts expire, they said the middle class would be the real winners.

Democrats warned that if you gave big corporations and the wealthiest Americans the lion's share of the tax cuts, those benefits wouldn't trickle down to employees and the middle class. We warned that corporations would do what they always do when they have profits-- distribute them amongst themselves. Even though big companies like AT&T were already paying low effective corporate rates, they had been shedding jobs and investment for years even before the tax bill.

Unfortunately, our warnings proved prescient. Almost every day, we hear a new story about a corporation using the savings from the Republican tax bill to purchase its own stock, called a stock buyback, which boosts the corporation's stock price to provide a reward for wealthy executives and shareholders.

Just this morning, the Kentucky-based chemical company Ashland announced a brand-new $500 million share repurchasing program. And last night, the total amount of corporate share buybacks surpassed $225 billion since the Republican tax bill became law.

Stock buybacks are a big reason why workers no longer see the benefits of record corporate profits. Why? Because instead of investing corporate profits in things that benefit the long-term health of the company and its workers--like higher wages, new equipment, research and development, or new hires--corporations spend the money on share buybacks.

In fact, stock buybacks were illegal until 1982, which is about the same time that wages stopped increasing with corporate profits.

Republicans dutifully remind us that companies are also handing out bonuses. Yes, a few. But let me highlight the disparity between buybacks and investment in workers: According to a recent analysis by Just Capital, only 6 percent of the capital allocated by companies from the tax bill's savings has gone to employees, while nearly 60 percent has gone to shareholders.

The theory behind the Republican tax bill was to allow corporations and the richest Americans to keep more of their already outrageous wealth, and maybe the benefits will trickle down to everyone else. As we are already seeing, that idea was a folly, and the American middle class will eventually pay the price.

Because of the enormous cost of the Republican tax bill, $1.5 trillion, the deficit and debt will grow over the next several years and Republicans are already targeting Social Security, Medicaid, and Medicare for cuts to make up the difference. So on top of a tax cut that mostly goes to the folks who need it the least, the Republican tax bill is an excuse for Republicans to come after Social Security, Medicare, and Medicaid.

That is why the bill is so unpopular that Republicans have abandoned it in last two special elections in Virginia and Pennsylvania.

The American people are already waking up to the reality that the Republican tax bill was not the middle-class miracle the Republicans promised, and in November, they will have the chance to move America in a dramatically different direction by voting for a party that actually wants to focus tax relief on working America, not corporate America.

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