On Corporate Privilege, Share Buybacks, Trickle-Down Economics, Taxation, and Anti-Competitive Actions

My response to a commentator arguing for trickle-down economics and against corporate taxation, and claiming he could not think of examples where a large corporation bullied small businesses, and claimed not to recall or understand instances when Walmart would sell at a loss to drive small businesses under:

Dr. Lt. Col. [Name], a scholar, helicopter pilot, military tactician, and financial advisor, can’t think of an example of big companies bullying small companies? Doesn’t understand markets? I’m having a hard time believing this.

Your questions and statements can be easily researched online and answered or discredited. Corporations avoid taxes all the time.

The Walmart story is well-known and you must have been living under a rock if you didn’t hear about it. It goes back to 1993 at least. They would sell certain items at a loss until local shops went out of business, and then raise their prices back up. This isn’t capitalist, but rather anti-competitive and unfair.

Corporations do not go to their customers directly to raise additional funds to pay taxes. They have the money, and the successful corporations do something with it. Being flush with cash, many are buying back shares… and executives coordinate the share buybacks so they can sell their shares at a high price, and this is legal. Meanwhile, many such corporations are paying low wages and bullying cities like Deltona (Amazon warehouse) into tax breaks when they could be paying higher wages or at least covering their employees’ Medicaid and food stamps. Wouldn’t it be nice if we could unionize cities, counties, and states nationwide to say no to bullying for tax breaks like Amazon having a phony competition for their 2nd headquarters on who can offer them the most taxpayer subsidies?

The idea that tax breaks lower costs to consumers is pretty rich. If consumers are willing to pay a certain price for an item or service, the price won’t come down either way.

“More money to give to their employees and stock holders”—really? They will raise pay to employees only if they must to compete for labor. You can’t argue for trickle-down economics, which is the idea that the market is fair and will take care of itself benefitting the 99% by eliminating taxes for the 1% and top corporations (which is corporate welfare for them as they are still benefiting from the USA’s many resources and public items such as financial markets, roads, natural resources, education, and so forth). Trickle-down economics has been empirically discredited.

If anything, the stock holders benefit the most, and it’s really getting tacked onto the national debt as the Tax Cuts & Jobs Act of 2017 was a total robbery to benefit big corporations and share holders. And, as you know, I’m a big advocate for owning pieces of the big corporations via index mutual funds, but half of Americans own no stocks, and you shouldn’t need to just to get a rebate from the U.S. Treasury.

Also, your idea that more consumption is good is under severe pressure in light of the climate crisis, which you cannot discount as a retired lieutenant colonel in the U.S. Army. The U.S. military knows the climate crisis is happening and they are making all sorts of preparations.

It’s pretty crazy that the United States is only 4% of the world population yet is home to 55% of publicly traded corporations by valuation. Given our immense wealth and prosperity, it’s crazy we are not investing in the American people by funding their medical care and education, at the very least. When you wonder why the young people are upset, or scoff at their preferred presidential candidate (Bernie Sanders), try to see things from our perspective and question the underlying assumptions that we have all been inculcated with.

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