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Oops. Group of CEOs admits they wouldn't invest the money they get from tax-cuts. (Original Post) DetlefK Nov 2017 OP
Trickle down economics is a pipe dream, just like Communism and Anarchism Oneironaut Nov 2017 #1
They were being honest about their greedy behavior BigmanPigman Nov 2017 #2
Careful not to let shareholders to see them raising their hands. nt oasis Nov 2017 #3
Well no shit. Orrex Nov 2017 #4
Of course not! Adrahil Nov 2017 #5
Stock buybacks. Fire employees. Keep it at the top. HughBeaumont Nov 2017 #6
Not surprising....... socialist_n_TN Nov 2017 #7
Bet a lot of them don't like the idea of tax cuts either. Xolodno Nov 2017 #8
Another Canard Exposed ProfessorGAC Nov 2017 #9
Much better said than mine. Roland99 Nov 2017 #11
Basic economics. Cant invest if qty demanded isnt rising Roland99 Nov 2017 #10
Nah, We Said The Same Thing ProfessorGAC Nov 2017 #13
People invest money to make money. Turbineguy Nov 2017 #12
They never did before... Wounded Bear Nov 2017 #14

Oneironaut

(5,530 posts)
1. Trickle down economics is a pipe dream, just like Communism and Anarchism
Wed Nov 15, 2017, 10:41 AM
Nov 2017

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. It’s a vacuum fleecing the middle class and working poor.

They also don’t contribute to small businesses. The middle class does. Without small businesses, the middle class dies.

BigmanPigman

(51,638 posts)
2. They were being honest about their greedy behavior
Wed Nov 15, 2017, 10:42 AM
Nov 2017

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.

socialist_n_TN

(11,481 posts)
7. Not surprising.......
Wed Nov 15, 2017, 10:58 AM
Nov 2017

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)
8. Bet a lot of them don't like the idea of tax cuts either.
Wed Nov 15, 2017, 11:08 AM
Nov 2017

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)
9. Another Canard Exposed
Wed Nov 15, 2017, 11:17 AM
Nov 2017

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)
10. Basic economics. Cant invest if qty demanded isnt rising
Wed Nov 15, 2017, 11:17 AM
Nov 2017

And qty demanded won’t go up if consumer don’t have he money to spend

Turbineguy

(37,374 posts)
12. People invest money to make money.
Wed Nov 15, 2017, 11:19 AM
Nov 2017

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)
14. They never did before...
Wed Nov 15, 2017, 12:33 PM
Nov 2017

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.

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