12 Jan 2018
Barbara Comstock has been awfully quiet lately, but yesterday she made a rare tweet that actually had something to do with public policy. Unfortunately, in this tweet she assumes that we are all complete morons.
The 8 Walmart stores within #VA10 employ nearly 3,000 people. Thanks to tax reform employees benefits will be expanded. Per the NYT Walmart said: “Tax reform gives us the opportunity to be more competitive globally and to accelerate plans for the U.S." https://t.co/44tOUlrFGs— Barbara Comstock (@RepComstock) January 11, 2018
Let’s check in with an actual economist:
So wage-hike announcements are what we would expect to see regardless of tax cut -- indeed, Walmart has been raising wages for several years. But there's an obvious incentive for corporations to give tax cut credit for wage hikes they would have done anyway 2/— Paul Krugman (@paulkrugman) January 11, 2018
If Comstock knew anything about economics (which she doesn’t), she would understand that the country is already at what economists refer to as “full employment”. Virginia’s employment levels are even better than the national average.
Unemployment Rate since January 2009
There was no need for economic stimulus (neither deficit spending, nor tax cuts). These tax cuts are just going to balloon the deficit and put upward pressure on prices (inflation).
Barbara Comstock and Paul Ryan also think they can trick us into believing that the GOP just invented the concept of year end bonuses.
What is actually happening as a result of these corporate tax cuts is that companies are using cash they had parked overseas to buy back their own stock (to raise the price). This results in bigger bonuses for CEO’s whose compensation is tied to stock price.
Yes, some people who work at Walmart are getting a tiny raise, but Judd Legum of Think Progress puts this in perspective:
2. First, you have to work at WalMart 20 YEARS to be eligible for the full 1K. The average bonus will be about $190. https://t.co/RXYtgIVV1u— Judd Legum (@JuddLegum) January 11, 2018
We’re not complete idiots. We all know that most corporations could care less about the welfare of their employees. In fact, exactly two hours after praising Walmart for all the jobs it creates in her district we get this bit of news.
- Wages go up naturally when the economy is at full employment
- Too much stimulus from tax cuts will cause the price of everything to go up (inflation)
- Most of the tax cuts are going to executives in the form of stock buybacks
- Year end bonuses were a thing long before 2017
It comes down to this:
Either Barbara Comstock thinks we are complete fools or she is a complete fool herself.
This November we’ll see who is laughing last.