Check Your Wallet: Can You Find the $4k Trump Promised You?

Frank Clemente

Frank Clemente Americans for Tax Fairness

It was a promise that couldn’t have been clearer: when President Trump sold his tax scam to Congress and the American people, he said the average family would see a $4,000 pay raise from their employers. “I would expect to see an immediate jump in wage growth,” added Kevin Hassett, head of Trump’s Council of Economic Advisors.

That was last October. The tax bill passed in December, and it’s now Labor Day, a good time to review how if at all the Trump-GOP tax scam is actually serving working people.

For most of them there’s a simple answer: it’s not. They’re still waiting for that $4,000 pay raise they were promised. Trump admitted as much (unknowingly perhaps) when he boasted during a speech marking the six-month anniversary of the tax cuts that “more than 6 million workers have received bonuses, pay raises, and retirement account contributions” because of the new law.

But do the math. Six million workers are barely 4% of the overall U.S. workforce of 155 million. So how about the other 96%? Incredibly, when you add in the rising cost of gasoline, prescription drugs and other necessities, real wages for most Americans have declined from a year ago.

Meanwhile, the wealthy and big corporations – let’s face it, the real intended beneficiaries of the tax cut law – aren’t waiting. They saw an immediate reduction in their taxes. For corporations, their tax rate was slashed from 35% to 21%.

Multinationals also got a $400 billion U.S. tax discount on their untaxed profits stashed offshore, and the chance to pay about half the domestic tax rate on future foreign earnings.

Many Republicans justified the huge tax cuts by saying they would spur economic activity and increase government tax revenues. President Trump’s top economic adviser, Gary Cohn, said that “we can pay for the entire tax cut through growth.” Sen. John Thune (R-S.D.) said that even “a modest amount of economic growth” could “cover the cost of this bill.” And White House budget director Mick Mulvaney went so far as to say the tax cut “actually generate[s] money.”

So what really happened?

Corporate tax receipts to the U.S. Treasury have plummeted—by over 40%, from $264 billion last year to $149 billion this year. Meanwhile, corporate profits have soared – up over 8%, reaching nearly $2 trillion in this year’s first quarter alone.

And what have corporations done with this windfall? Instead of spending on pay raises for their workers, they bought back their own stock. A lot of it. More than $700 billion worth of stock buybacks have been announced since the Trump-GOP tax law was enacted. That’s 100 times more than the $7 billion workers got in bonuses and raises.

Stock buybacks are a Wall Street maneuver that artificially raise the price of a company’s shares. Who benefits? Mostly CEOs, who receive a lot of their compensation in the form of stock, and other wealthy, well-connected shareholders, not rank-and-file workers.

The tax cuts have also added almost $2 trillion to the deficit. Now Republicans are trying to cover the hole they created by cutting critical public services that are important to working families.

Trump wants to cut Medicare and Medicaid— even though he promised during the campaign he wouldn’t touch them – as well as the Affordable Care Act (ACA). His cuts total $1.3 trillion over 10 years. Upping the ante, Congressional Republicans want to cut $2 trillion from these services. If adopted, this will mean millions of Americans will lose their insurance coverage. Premiums will soar for millions more, the age of Medicare eligibility will go up and prescription drugs will be even costlier.

Stagnant wages, rising costs, a ballooning deficit, cuts to healthcare and other vital services. Sadly, American workers won’t find much to cheer about this Labor Day in the much-ballyhooed tax cut law. But if a new Congress repeals the tax cuts for the wealthy and corporations and invests the money to make healthcare more affordable, provide free tuition to public colleges and rebuild infrastructure, then next Labor Day workers may really have something to celebrate.

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Reposted from Our Future

Posted In: Allied Approaches, From Campaign for America's Future

Union Matters

Get to Know AFL-CIO's Affiliates: National Association of Letter Carriers

From the AFL-CIO

Next up in our series that takes a deeper look at each of our affiliates is the National Association of Letter Carriers.

Name of Union: National Association of Letter Carriers (NALC)

Mission: To unite fraternally all city letter carriers employed by the U.S. Postal Service for their mutual benefit; to obtain and secure rights as employees of the USPS and to strive at all times to promote the safety and the welfare of every member; to strive for the constant improvement of the Postal Service; and for other purposes. NALC is a single-craft union and is the sole collective-bargaining agent for city letter carriers.

Current Leadership of Union: Fredric V. Rolando serves as president of NALC, after being sworn in as the union's 18th president in 2009. Rolando began his career as a letter carrier in 1978 in South Miami before moving to Sarasota in 1984. He was elected president of Branch 2148 in 1988 and served in that role until 1999. In the ensuing years, he worked in various roles for NALC before winning his election as a national officer in 2002, when he was elected director of city delivery. In 2006, he won election as executive vice president. Rolando was re-elected as NALC president in 2010, 2014 and 2018.

Brian Renfroe serves as executive vice president, Lew Drass as vice president, Nicole Rhine as secretary-treasurer, Paul Barner as assistant secretary-treasurer, Christopher Jackson as director of city delivery, Manuel L. Peralta Jr. as director of safety and health, Dan Toth as director of retired members, Stephanie Stewart as director of the Health Benefit Plan and James W. “Jim” Yates as director of life insurance.

Number of Members: 291,000 active and retired letter carriers.

Members Work As: City letter carriers.

Industries Represented: The United States Postal Service.

History: In 1794, the first letter carriers were appointed by Congress as the implementation of the new U.S. Constitution was being put into effect. By the time of the Civil War, free delivery of city mail was established and letter carriers successfully concluded a campaign for the eight-hour workday in 1888. The next year, letter carriers came together in Milwaukee and the National Association of Letter Carriers was formed.

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There is Dignity in All Work

There is Dignity in All Work