Trump’s Shareholder Bonanza

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Robert Reich – Trump’s Shareholder Bonanza:

The evidence is in: The biggest beneficiaries of the Trump-Republican tax plan are shareholders.

Yesterday, Bank of America Brian Moynihan said that “most of the benefits” from the tax cuts “will flow to the bottom-line through dividends and share buybacks over time.”

Exactly. Dividends and share buybacks boost share prices. And that’s all corporate America wants to do.

Moynihan noted that in 2017, Bank of America had $16.6 billion of net income available to shareholders and returned $16.8 billion through dividends and buyback. “So, yes, we will expect to return more capital to shareholders given the tax [cut].”

Even the expectation of a big corporate tax cut have caused shares to soar.

[But} Because the richest 1 percent of Americans owns 40 percent of all shares of stock, and the richest fifth owns 80 percent, this is great news for the wealthy.

It’s not great news for anyone else.

Read on.