Early tax bill reality very different than Democratic rhetoric
Will Democrats and progressive activists apologize for their steadfast opposition to tax cuts now that the benefits to their so-called constituents have become so clear?
Don’t hold your breath.
Yet it’s worth reiterating how different the tax cut reality has been from Democratic rhetoric.
Friday’s jobs report demonstrated strong December hourly wage growth, helping bring the increase for 2017 to a respectable 2.5 percent. This figure will only accelerate as it begins to incorporate the millions of Americans who receive tax cut-induced raises and bonuses.
Over one hundred companies — including major airline, media and financial employers — have recently publicly announced that they are directing part of their tax cut savings to significant pay increases for their employees, to the combined tune of over $1 billion.
Last week, JetBlue Airways announced it will give $1,000 bonuses to each of its 21,000 crew members. This followed announcements by Southwest and American airlines that they will give the same bonus to their 55,000 and 127,000 employees, respectively.
AT&T is giving $1,000 bonuses to more than 200,000 employees. Comcast also is giving $1,000 bonuses to its more than 100,000 employees, and Sinclair Broadcast Group will give the same amount to its 9,000 employees.
Bank of America is giving $1,000 bonuses to its 145,000 employees. PNC Bank is giving the same to its 47,500 employees. And BB&T will gave $1,200 bonuses to its 27,000 employees. Dozens of other banks and financial institutions are following suit, giving windfalls to tens of thousands more employees.
Then there are the companies raising their lowest wages to $15 an hour. Wells Fargo, U.S. Bancorp, BB&T and Fifth Third Bancorp are among the biggest banks and financial institutions that are raising their lowest wage to this level. Don’t expect the activist group Fight for $15 to change its strategy for achieving a $15 minimum wage from government mandate to letting businesses keep more of their earnings.
Other businesses also made moves that will help workers. CVS and FedEx announced they are going to hire thousands of new employees. Boeing announced a $100 million investment in workforce training to help its employees learn skills to make them more valuable. Aflac, Nationwide Insurance and SunTrust boosted 401(k) contributions.
And all employees’ 401(k) and other retirement plans have been significantly boosted by the tax cut-generated stock market surge. Last week, the Dow Jones eclipsed 25,000, less than a year after it topped 20,000 — one of the fastest increases in history. For the over half of Americans with underfunded retirement accounts, this is welcome news.
And employees haven’t even begun to feel the direct effects of tax cuts in their paychecks from reduced federal withholding that will take effect as soon as next month. The tax bill’s doubling of the standard deduction and elimination of the 15 percent tax bracket in favor of a vastly expanded 12 percent rate will result in higher take-home pay for those who need it most.
Taken together, these pay increases will provide long overdue relief to the roughly two-thirds of working-class Americans who cannot cover an unexpected $400 expense and the four-fifths of working Americans who live paycheck-to-paycheck.
Contrast this picture to the one Democrats painted during the tax bill debate. Democratic House Minority Leader Nancy Pelosicalled the bill a “monumental, brazen theft from the American middle class.” Sen. Bernie Sanderssaid the legislation is a “disaster for the American people.” Oregon Sen. Jeff Merkleycalled it “the biggest bank heist in history.”
Unless Democrats issue a mea culpa for this false fearmongering, voters should assume they’ll try to take away their tax cut pay gains if they return to power.