Corporations are focusing too much on stock buybacks and other ploys to dump money in the laps of their shareholders now, right away, rather than planning for long-term strength by investing in the workforce. To tackle that, Hillary Clinton is suggesting
tax incentives for businesses that share profits with workers:
The “rising incomes, sharing profits” tax credit Mrs. Clinton is proposing would give companies a two-year tax credit equivalent to 15 percent of profits distributed to employees, to be capped at 10 percent of wages. The credits would cost an estimated $10 billion to $20 billion over 10 years and would be paid for by closing corporate tax loopholes. If a company provided an employee earning $50,000 annually with a $5,000 profit-sharing payment, for example, that company would receive a $750 tax credit in return.
This is not a bad idea. It's also not necessarily the best way to improve wages for workers:
“There’s nothing wrong with profit-sharing, but it just shouldn’t take the place of a healthy paycheck,” said Jared Bernstein, a senior fellow at the Center on Budget and Policy Priorities and a former economic adviser in the Obama administration.
Mrs. Clinton’s plan would make companies eligible for the tax credit only if the profit-sharing payments were above existing wages and benefits, a campaign spokesman said.
But Republicans love tax breaks, so let
them explain why they don't like this particular one.