Republicans trust corporations more than regular people. Corporations have certainly not earned that trust, not by a long shot. Just recently we saw the latest example of large-scale corporate malfeasance, as the Volkswagen emissions cheating scandal reached a new level of s(ick)ening with the revelation that the company forced monkeys to be exposed to exhaust fumes—at least they let them watch cartoons in the meanwhile. One executive (just one?) has finally been suspended.
But do we need strong regulations, and should we properly fund their enforcement? The Republican Party and its leader, Donald Trump, have spent the last year making their answer to that question quite clear. They trust corporations. And they do so because the Republican Party and the wealthy interests who own those corporations operate as partners (in crime).
We see this partnership in the breathless announcements by companies touting the bonuses they are giving workers and the investments they are making supposedly because of Trump’s tax plan. Never mind that many of these were already scheduled (like AT&T’s bonuses and much of Apple’s investment, for a couple of examples), or that other companies, like Walmart, Home Depot, and Lowe’s announced that full-time workers would get a bonus of “up to” $1000, but only gave that amount to employees with twenty years on the job. The median bonus in those cases was more likely around $200 for full-timers, given the average tenure for workers in the retail industry. This NYT article details other examples of bonuses that “didn’t live up to their billing.” Oh, and Walmart also cut 10,000 jobs the same day it touted the bonuses.
Overall, Trump giving ‘shitholes’ of money to corporations led to some of it trickling down—in the form of one-time bonuses, rather than raises, in most cases. Please note that the benefits to the corporations, of course, are not one-time bonuses but gifts to their bottom lines that will keep on giving every year, at least until Democrats get in there and do tax reform the right way. When 241 corporations were asked if Trump’s rich man’s tax cut would lead them to increase salaries going forward, 83% said no.
What exactly is the relationship between these bonuses, not to mention the overall wage gains that Trump touted in his State of the Union address, and his rich man’s tax cut? Here’s economist Joel Slemrod of the University of Michigan, whose expertise is in studying the economic effects of tax legislation (he co-wrote the “seminal” work on the 1986 tax reform law’s impact):
Many companies have been doling out bonuses to employees since the tax legislation passed, but “I don’t think that tells us anything,” Professor Slemrod said. That’s because in standard economic theory, labor market conditions dictate employee compensation levels, not cash flow or profitability.
“The labor market was strengthening long before Mr. Trump was elected or the tax bill was passed,” Professor Slemrod said. “If companies were going to raise wages anyway to stay competitive, they have a public relations incentive to attribute it to tax cuts.”
The part about the companies’ “public relations incentive” is really the key. As Matt Yglesias wrote: “the CEO class in America has decided that a steady dose of flattery is the best way to keep Trump focused on his current embrace of hard-right economic policy.” Of course, the right-wing media plays into this cycle of flattery by touting the corporations’ press releases as if they were objective analyses of the tax plan’s actual impact (see, for example, the video below). This whole multi-headed ecosystem of bullshit is designed to fool the American people into thinking that a tax cut for millionaires and billionaires is really going to help average, working stiffs, and that’s why those working stiffs should vote Republican.
Remember when Mitt Romney said “corporations are people, my friend”? I wish Republicans actually believed that. If they subjected corporations to the same level of scrutiny, and treated them with the same level of distrust they show to the millions of regular Americans trying to vote or claim the benefits to which the law entitles them, that would represent a pretty radical shift from current GOP positions.
Here’s the thing: to Republicans, corporations and the financial elites whom they benefit aren’t people—they are something fundamentally separate, and far more valuable: donors. As we saw during the tax debate, it is those big donors, not people, who call the shots in the Republican party:
Being a progressive means not judging a person’s trustworthiness on the basis of their income level, race, religion, gender, etc. Or at least it means we don’t enshrine those different levels of trust into laws that treat categories of people differently. We understand that while most people are moral much of the time, unfortunately, the threat of punishment is necessary to prevent some from taking advantage of others. We also understand that the punishment must be commensurate with the crime and with the benefit someone would receive from committing it.
Our laws must have severe-enough punishment and, and this second part is crucial, robust-enough enforcement that would-be corporate criminals will think twice before breaking them. I’m talking those who would reap huge rewards from, for example, polluting our air in order to sell more cars, or opening accounts without the permission of millions of customers, or running mines while violating safety rules—leading to the deaths of 29 supposedly highly valued employees, or “manipulating” test results of automobile airbags that lead to 16 deaths and at least 180 injuries, or learning of a problem relating to its cars’ ignition switch but “reject[ing] a proposal to fix the problem because it would be too costly and take too long.”
Republicans say they are worried about too much regulation hurting business. Never mind the research that counters such concerns about regulation and cost, on, for example, the financial industry that generates so much GOP hand-wringing. The aforementioned examples of heinous crimes make clear that human greed, combined with an arrogance that fuels risk-taking, appears to run rampant at the highest levels of corporate management.
Republican ‘philosophy’ centers on the prosperity gospel, loosely defined as a belief that wealth is a sign of God’s grace, or, in more simple terms, that God loves winners and hates losers. That “grotesque interpretation of Christian gospel” influences their approach to regulation when it comes to business people. They don’t want silly rules to get in the way of all that winning.
The problem is not that Republicans are naive about human nature as a whole. We certainly don’t see them worried about too much “regulation” hurting voter turnout or preventing Americans from getting Temporary Assistance for Needy Families or even, as Wisconsin is trying to do—getting health coverage through Medicaid. Republicans don’t assume those kinds of human beings will do the right thing without strict regulations and harsh punishments to keep them in line.
What it comes down to is that Mitt Romney was wrong. Republicans don’t believe corporations are people, too. They believe corporations are better than people—people who aren’t rich, at least.
Ian Reifowitz is the author of Obama’s America: A Transformative Vision of Our National Identity (Potomac Books).
Here is the aforementioned video of me discussing the bonuses and the Trump tax plan: