Bogus bonuses welcome, too little, too late

Bill Knight column for Thurs., Fri., or Sat., Feb. 15, 16 or 17, 2018

The old saying advises, “Don’t look a gift horse in the mouth.” Considering bonuses that corporations claim stem from federal tax reform, you might think, “Don’t see a thoroughbred breeding in the pasture when a mule’s pooping in the pen.”

President Trump claims that almost 3 million U.S. workers have received bonuses, “many of them thousands and thousands of dollars per worker,” he said in his State of the Union speech. And, indeed, some 275 companies in the last month or so announced one-time bonuses of up to $1,000 or raises while tying the moves to the Republican tax bill that Trump signed in December.

Even if the president isn’t lying or exaggerating, that doesn’t favorably compare to the number of working Americans. Few employees have received anything: about 2 percent of 154 million. (Before Trump signed the GOP’s $1.5 trillion tax measure, the administration said 38 percent of workers could get bonuses.)

Critics say the bonuses – and announcements – make up a huge, coordinated publicity stunt to justify and support the tax plan, which benefits corporations and the wealthy far more than most Americans. While corporations’ taxes are immediately and permanently cut from 35 percent to 20 percent under the GOP plan, middle-class Americans will owe more in taxes by 2027, even if they see modest relief this year.

Meanwhile, many of these same employers – like Bank of America, Boeing, Home Depot, Honeywell, Hostess Brands, Kimberly-Clark, Lowe’s and Tyson – have hadd layoffs, hiked fees and engaged in financial maneuvers such as stock buybacks to enrich executives and stockholders.

In fact, executives at Amgen, Cisco, Coca-Cola and Pfizer all said that their companies will increase dividends or buy back shares from stockholders before investing tax savings in new hires or higher pay, Bloomberg News reported.

Still, Walmart said it will raise some hourly wages by $1 and will distribute bonuses of up to $1,000 to some workers, and AT&T, Comcast and Southwest Airlines also all issued $1,000 year-end bonuses.

However, bonus paymasters:

* Walmart is shutting down 60 locations of its subsidiary Sam’s Club and cutting jobs;

* AT&T is laying off thousands of employees;

* Comcast is shedding 500 workers; and

* Southwest Airlines continues to drag its heels in bargaining with the Aircraft Mechanics Fraternal Association’s Aircraft Maintenance Technicians (AMT) unit.

“Walmart gave out what amounts to about 2 percent of the value of their tax cut over 10 years in bonuses,” reported journalist Judd Legum of ThinkProgress. They “made a big deal about it; got praise from the president. Meanwhile, it was abruptly shutting stores across the country. It’s diabolical.”

Larry Robbins, a Communications Workers of America (CWA) leader in Indianapolis, agreed, saying that AT&T’s bonuses and new job claims are a scam.

“The $1,000 bonus and the promise of 7,000 new jobs are all a publicity stunt,” Robbins said.

Further, AT&T actually agreed to a compromise with the CWA to send $1,000 bonuses and a 10-percent wage hike for thousands of union workers after the CWA demanded the $4,000 windfall that Republicans touted when the bill passed.

“Republican leaders have promised that households would receive, on average, a yearly $4,000 wage increase,” the CWA said in a prepared statement. “They also claimed that the corporate tax plan would produce new jobs in the U.S. as companies return work from offshore.”

The $1,000 bonus was “a drop in the bucket compared to what was promised,” the union added.

As for Southwest Airlines, its bonus should be seen as a tiny acknowledgement of what AMTs have endured about 2,000 days of negotiations, the union said.

“While the Company experienced record profits during this time, our members have not received increases in pay, enhancements to benefits or, most importantly, job security as they threaten to outsource even more work,” commented AMFA national director Bret Oestreich.

The PR campaign has more to do with ingratiating themselves to the Trump administration than investing in workers or the economy, said journalist and author David Dayen, whose investigative journalism into Wall Street’s foreclosure fraud resulted in the book “Chain of Title.”

“The bonuses aren’t coming out of tax savings that don’t hit until next year,” he reported. The corporate announcements of bonuses and expansions are “PR campaigns applying already-announced or determined actions to the tax bill. [It] shows these companies had the cash all along.”