General Discussion
Related: Editorials & Other Articles, Issue Forums, Alliance Forums, Region ForumsOops. Group of CEOs admits they wouldn't invest the money they get from tax-cuts.
Link to tweet
An audience full of CEOs.
"Show of hands. Who will invest more if you get the tax-cut?"
10% of hands go up.
Oneironaut
(5,530 posts)It requires money to be constantly moving, when reality shows us that those at the top simply hoard the money. Even worse, they do it in other countries, so the US never sees that money. Its a vacuum fleecing the middle class and working poor.
They also dont contribute to small businesses. The middle class does. Without small businesses, the middle class dies.
BigmanPigman
(51,638 posts)but that was in a room of their peers and not admitting it for public records and the media. Gee, trickle down economics is a 30 year scam? Go figure.
oasis
(49,426 posts)Orrex
(63,232 posts)They never have before, so why would they start now?
Adrahil
(13,340 posts)Supply responds to demand. Always has.
HughBeaumont
(24,461 posts)socialist_n_TN
(11,481 posts)Capitalism ONLY invests when it has a chance to make ENOUGH profit. Mere profit isn't enough for the big players, it has to be ENOUGH profit. And with a declining RATE of profit in the productive sector and fictitious capital (non-productive investments) paying more than the productive sector, it's only logical that what investments they would make with that extra money would be in the area of fictitious capital. The Wall Street casino for the most part. Of course, that area is supposed to be more "risky", but the Great Recession proved that if you fail big enough, your toadies in the government will bail you out with taxpayer money, so where's the real risk?
People have the mistaken belief that capitalism has the good of society as the end result of its workings, but in reality, the ONLY concern is enough profit.
Xolodno
(6,406 posts)People need to buy their products...if they don't have the money to do so, they don't hit sales targets, which means they don't get a bonus. What good is a tax cut on money you don't get?
ProfessorGAC
(65,239 posts)If not the CEO's, then the CFO's would be able to figure out that the added cash has no value as investment if the consumption of goods and services is not increasing. Since the tax cuts are targeting the corporations and the ultra rich, there is no huge excess of discretionary cash flowing into the macroeconomy, and hence, no increase in purchasing power for the vast majority.
Further investment is just a sunk cost with no ROI. On top of that, this idea that the wages will inflate when no further demand exists means the margins on goods and services sold goes down. Wall Street analysts pay attention to metrics like return on sales and return on investment.
Hence reinvesting makes ROI go down and even though the balance sheet improves, stock price won't or could go down. Artificially increasing wages (which of course will NEVER occur) cuts into the the ROS which likely causes speculators to underbid and damages stock prices.
The internal analysts and CFO's are NEVER going to just pass those savings on. Even those who are not Randian morons would still be able to do a sound financial analysis and realizes it would better to buy securities and sit on cash (reducing RLOC usage) rather than make investments that won't pay off. They don't have to be bad guys to realize that. I realize it and i'm not one of the bad guys. (Well, i'm not a CFO either, so there's that)
The very idea that corporations would act AGAINST their own interest is preposterous, even within the civically responsible firms. It's just another lie by the supply siders.
Roland99
(53,342 posts)Roland99
(53,342 posts)And qty demanded wont go up if consumer dont have he money to spend
ProfessorGAC
(65,239 posts)I was just far wordier.
Turbineguy
(37,374 posts)When you cut their taxes, they make money.
That's why they invest in lobbyists and republicans. It's cheaper and quicker to buy a republican politician.
Wounded Bear
(58,737 posts)why would it start now?
Well, back in the days of higher marginal rates, Execs almost had to re-invest their gains in the workers and general company expenses. That stopped with Reagan, and has been the same ever since. Big part of the reason wages for workers have stagnated.