Wyden statement on Republican tax law, record-breaking corporate stock buybacks

Wyden: “While middle class families are waiting for Republican promises to come true, the investor windfalls will keep adding up”
Washington, D.C. – Senate Finance Committee Ranking Member Ron Wyden, D-Ore., delivered remarks on the Senate floor following a report that corporate stock buybacks have reached $200 billion since the passage of Republicans’ tax law.
 
“Just a few hours ago, corporations crossed the $200 billion mark in stock buybacks this year. Stock buybacks are windfalls that drive up the value of investment portfolios for CEOs and high-flyers. And they’re coming in at a rate 30 times greater than worker bonuses — 30 to one! They’re on pace to double the amount from the first quarter of last year.
 
“Now there was a whole lot of happy talk about this Republican tax plan last winter, but nobody said anything about why Congress ought to pass a Stock Buyback Stimulus Act.
 
“The wealthiest 10 percent of earners own 84 percent of all the stock held by Americans. So when it comes to these buybacks, a huge majority of families are on the outside looking in. Moms and Dads balancing the rent, the grocery bill, the cost of gas and electricity. They don’t get much of anything out of a corporate handout that gets swallowed up by windfalls for big-time investors.”
 
Wyden’s full remarks as prepared for delivery
For the elite, the powerful and the well-connected, the Republican tax law has turned out to be manna from Washington. The benefits of this law are about as one-sided as it gets, and middle class Americans come up on the losing end.
 
It sure is one-sided when the price of admission for any middle class tax relief is an investor handout big enough to pave Wall Street in gold. Democrats pushed for a tax cut that was centered on the middle class. But Republicans turned their own one-sided wish list into law.
 
It sure is one-sided to have a massive tax handout to multinational corporations, a lower top rate for the fortunate few, and a massive cut in the estate tax that only touches the wealthiest taxpayers, while hard-working families get handed only temporary relief.
 
Those are the policies that are the essence of the Republican tax law. But the American people are still hearing over and over again that the benefits of those proposals are going to work their way down to middle class families, and their paychecks will be bulging with wage increases.
 
Let’s get a few facts straight. First, just a few hours ago, corporations crossed the $200 billion mark in stock buybacks this year. Stock buybacks are windfalls that drive up the value of investment portfolios for CEOs and high-flyers. And they’re coming in at a rate 30 times greater than worker bonuses — 30 to one! They’re on pace to double the amount from the first quarter of last year.
 
Now there was a whole lot of happy talk about this Republican tax plan last winter, but nobody said anything about why Congress ought to pass a Stock Buyback Stimulus Act.
The wealthiest 10 percent of earners own 84 percent of all the stock held by Americans. So when it comes to these buybacks, a huge majority of families are on the outside looking in. Moms and Dads balancing the rent, the grocery bill, the cost of gas and electricity. They don’t get much of anything out of a corporate handout that gets swallowed up by windfalls for big-time investors.
 
Second, when you talk about tax cuts producing massive stock buybacks, you’re talking sending huge amounts of cash overseas straight into the pockets of wealthy foreigners. That’s because more than a third of all U.S. corporate stock is owned by investors outside of the U.S. So under the Republican tax law, American taxpayers are on the hook borrowing billions upon billions of dollars to make wealthy foreigners even wealthier. That’s not lifting up working families in Portland, Topeka, or San Antonio. It’s enriching the powerful in Beijing, Moscow and Panama City.
 
Finally, you don’t have to take my word for it that these corporate windfalls overwhelmingly benefit those at the top. Fourteen years ago, the federal government gave corporations what’s known as a “repatriation holiday,” a big tax break to bring back cash from overseas. And what the American people heard back then sounds awfully familiar today — corporations were going to invest in workers and equipment, and the money would trickle down to the middle class.
 
Well, it didn’t work out that way. More than 90 percent of the corporate cash windfall went to goodies for investors and CEOs — awfully one sided.
 
It’s not even two decades later, and the American people are still being fed a line about how their one-sided tax plans will deliver bulging paychecks to middle-class families.
 
A few weeks ago, Treasury Secretary Mnuchin came before the Finance Committee. He was asked who really benefits when the Republican tax bill showers cash over multinational corporations.
 
Secretary Mnuchin said, quote, “Even if there are share buybacks … that capital is recycled back into the economy. It just doesn’t sit in banks, it goes back into the economy.”
 
That sounds an awful lot like trying to put a new spin on the failed theory of trickle-down economics. But in my view, middle class families are sick and tired of being told to wait for the benefits to trickle down.
 
From the get-go, my message on taxes was that if Senators were interested in real middle-class tax relief, I’d be at the head of the line, ready to work on a bill.
 
Instead, Republicans moved at break-neck speed to pass a one-sided plan that would fatten the accounts of wealthy, powerful shareholders and CEOs around the world.
 
It’s time for the Treasury Secretary to stop pedaling the old huckster’s line — that it’ll all work out for middle class families if they just wait long enough — because this Republican tax bill was never about middle class tax relief. You can see it in the numbers. While middle class families are waiting for the promises to come true, the investor windfalls will keep adding up.