Last week, President Obama issued a veto threat against a package of tax cuts that the Senate was preparing to pass. The tax cuts were going to lock in tax benefits for big corporations while actually eliminating some middle class tax breaks. Thankfully, the veto threat was effective and the bill died.
Given all our other problems, all the critical issues that need addressing, like immigration, unemployment benefits, and crumbling infrastructure, Congress was focused on passing tax cuts for corporations.
Take a look at the following charts, compiled by the New York Times. The first shows that corporate profits as a share of GDP are the largest in history. The second shows that the corporate tax rate in America is at record lows. Finally, the third chart shows that employee compensation has been dropping for decades.
This is what's wrong with America's economy. Corporations are sitting on huge stockpiles of cash, while their underpaid employees have to get assistance from the government to eat. The stock market has more than doubled since President Obama was elected, the rich are richer than ever, but workers are being paid less and less and NONE of this wealth is "trickling down". If some of those huge stockpiles of corporate cash were redirected to employee pay or new taxes, the influx of cash would give a huge boost to all sectors of the economy. We would ALL win.
Read what a Goldman Sach's guy has to say about it.
In fact, the reason why corporate profits are sky high is that employee compensation is so low, explained Jan Hatzius, Goldman Sachs' lead U.S. economist: "The strength (in profits) is directly related to the weakness in hourly wages." LinkThis would be an easy fix, if Congress weren't being held hostage by a bunch of corporate shills who don't care about the lower and middle class. And I'm not talking about the Democrats. Sure, there are some Democrats who will do anything for corporations. They were bringing the bill up in the Senate after all. But if Democrats held both houses, they would raise the Minimum Wage and shift some of the tax burden to the rich. The Republicans are the ones pushing the "poor corporate America" storyline and they have been for decades. They've been so effective in this propaganda that tens of millions of poor and middle-class Americans regularly vote against their own economic self-interest.
As long as Republicans hold the reins, those charts will continue to get worse and worse. And so will America.