Warren Buffett’s annual letter to shareholders disclosed that Berkshire Hathaway reaped a massive gain as a result of the Republican tax reform passed in December. As Buffett wrote, “a large portion of our gain did not come from anything we accomplished at Berkshire.” Rather, $29 billion was handed out to Berkshire Hathaway, a large, highly successful investment company that hardly needs the help.
Most companies that have made announcements on how they are using their tax savings are planning to pass those savings directly to shareholders in the form of stock buybacks or dividends, according to new nonpartisan research. Two thirds of the companies surveyed will use at least 75 percent of their savings to boost stock buybacks and dividends. In total, the research shows that companies plan to use 58 percent of their tax savings on these stock boosting moves, compared with 6 percent being passed to workers in the form of higher wages, one-time bonuses, higher benefits, or worker training.
In January, the Consumer Financial Protection Bureau (CFPB), under the direction of Mick Mulvaney, dropped a lawsuit against a payday lending company with a history of charging up to 950 percent interest on small-dollar loans. This move is part of the interim director’s strategic plan to deregulate and defang the consumer agency, which he repeatedly criticized as a congressman.
The president’s recently released budget proposes steep cuts to non-defense discretionary spending, which includes housing, education, infrastructure, food assistance, and other investments critical for working families. Over the next ten years, the budget would reduce Supplemental Nutrition Assistance Program (SNAP) benefits by nearly 30 percent, cancel housing vouchers for roughly 200,000 households, and cut support for income assistance and work programs for families with children.
Despite Republican assurances that corporate tax cuts would generate wage increases for workers, the evidence so far shows that it is shareholders, not workers, who are realizing the vast majority of gains from tax reform.
This fact sheet provides a snapshot of the current economic state of the black community in the United States, including employment, earnings and wealth data, among other key indicators. Together, these measures help paint a portrait of some of the challenges facing black America and its economic prospects for the future.
Feb 13 2018
Retirement Security in Peril
American workers are facing a crisis: the inability to retire with dignity after a life of hard work. After years of supporting families and contributing to society, American workers are confronting a nearly empty retirement nest egg. Half of all American families near retirement have $12,000 or less in formal retirement savings.1 Not only do far too many workers earn too little to adequately save for retirement, but many more also lack access to good retirement saving plans. Many other factors, including the 2007 financial crisis and slow wage growth, have exacerbated the problem.2
The Congressional Research Service released a study of wage trends since 1979, showing that not all Americans have been sharing in the economic growth of recent decades. Workers in the middle and bottom-end of the wage distribution have seen real wages stagnate or even fall, while most of the wage growth has concentrated at the top. The report also dives into demographic trends in wages and wage growth, and shows that wages for those without college degrees, in particular, have been falling for much of the period.
The black-white wealth gap is staggering, and has dire implications for families across the country. The median net worth of a white household is $171,000 while the median net worth of a black household is $17,600. Wealth helps families weather economic downturns and periods of unemployment, prepare for retirement, launch new businesses, and set up future generations for success. There are likely many factors influencing this disparity, including the racial wage gap, discriminatory housing and housing-finance practices that lead to lower rates of homeownership, and less access to financial institutions and tools. This Black History Month, the Trump administration should be coming up with a plan to tackle this problem rather than taking credit for years-long trends in the racial unemployment gap.
Since February 5, 1993, the Family and Medical Leave Act (FMLA) has kept millions of workers from losing their jobs, but we can do more. FMLA covers less than 60 percent of the workforce, and it only guarantees up to 12 weeks of unpaid leave, which millions of Americans cannot afford to take.