An unusual experiment with the truth from Donald Trump: he tweeted, truthfully, that “corporations have NEVER made as much money as they are making now.”
But consider the lies that truth exposes.
If corporations are making record profits – they are – then exactly why should the US adopt a gigantic corporate tax cut? There is only one page of details available from the administration about its tax plan, but we know it aims to confer trillions on corporations and the super-rich. That’s why the Koch Brothers are promising dozens of events and rallies around the country, and the corporate-friendly American Action Network says it’s ready to spend $20 million to support tax cuts for the wealthy. But what’s the rationale? If corporations are already doing great, why exactly do they need trillions of dollars in tax breaks?
If corporations are making record profits – they are – then how is it that regulations are strangling corporate activity? Donald Trump and the U.S. Chamber of Commerce endlessly recite thoroughly discredited claims that excessive regulation is strangling corporations. In fact, health, safety and environmental regulations spur innovation and help the economy. And it was regulatory failure that enabled the housing bubble and Great Recession, which together did far more harm to the economy (and even corporate profits) than regulations ever could.
If corporations are making record profits – they are – then why are wages are stagnant? Well, actually those two things go together. Corporations are grabbing a larger share of national income – taking it directly from working people. And the wage income that is being parceled is going increasingly to the top 1 percent. From 1979 to 2013, wages of the top 1 percent grew 138 percent. For the bottom 90 percent of the population, wages rose only 15 percent. If corporations are making record profits, shouldn’t workers reasonably expect that more of the gains be shared with them?
If corporations are making record profits – they are – then why we can’t raise the minimum wage? In 1968, the minimum wage was $11.25/hour in today’s dollars — $4 an hour more than the current minimum wage. That understates how far behind the minimum wage is – the overall economy has grown almost four times during that period.
If corporations are making record profits – they are – then why is there so little money in the Trump budget for low-income home heating or Medicaid or food stamps or food safety or consumer safety or public housing or legal services or disease research or mass transit or global health or international disaster relief or environmental protection or scientific research or agricultural research or energy efficiency? Why is the government supposedly so poor and cash strapped that it can’t do the things we need to do to take care of each other, maintain a decent society, avert preventable illness and disease, invest in our infrastructure, promote innovation or avert catastrophic climate change, the greatest threat humanity has every faced?
One inconvenient truth that Donald Trump did not elucidate is that record corporate profitability has virtually nothing to do with his six months in office. Many commentators are highlighting this point, saying that “credit” should really go to the Obama administration. That’s a reasonable argument, as far as it goes.
But it also points to deep structural problems in our economy, our politics and society. For while the Obama administration did not propose, ridiculously, to slash corporate taxes nor wage a savage attack on regulatory protections nor aim to hack away at vital government programs, it did preside over a period of record corporate profits amidst ongoing wage stagnation. Surviving the Trump administration will enable us to put many problems behind us, but not the most pernicious.
Robert Weissman is the president of Public Citizen.