PRESS RELEASE

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Prins: Corporate Tax Cut Won’t Bring Growth, but More Speculation

Dec. 27, 2017 (EIRNS)—American banking historian and former investment banker Nomi Prins wrote in yesterday's Truthdig on the just-passed GOP "tax reform": "In 2016, corporations collectively paid about $300 billion in federal taxes (or just 9% of all Federal tax receipts). In contrast, Standard and Poors 500 companies bought back over a half-trillion dollars of their own stock, indicating they were hardly hurting from undue tax burdens. Citigroup asked and received from the Fed permission to buy back $15 billion of its own stock over the year; Bank of America will buy back $17 billion and JPM Chase will purchase $19 billion of its own shares—this in just over a year.

"Their choice to buy their own stock is legal manipulation of the market and a diversion of funds that could be deployed for small businesses, individual loan restructurings or long-term infrastructure or development projects that would employ more people in more secure jobs."

Since the biggest banks are the biggest corporations, they will get very large tax cuts. ThinkProgress, in a story on an estimate by Goldman Sachs itself, reports the eight major banks getting a total of $17 billion in lowered taxes for 2018—the basis for buying back all that stock. The biggest tax savings will go to Wells Fargo, which epitomizes the rewarding of banks’ criminal behavior during this century.

It’s clear why JP Morgan Chase CEO Jamie Dimon said, "Just think of it [the tax bill] as QE4," i.e., version 4 of the "quantitative easing" bailout policy.