President Trump ran for office promising the little guy he wouldn’t make America’s richest richer at their expense. He was going to clean the swamp out in Washington and make America great again by leveling the playing field.
As President Trump begins his campaign for reelection, he will no doubt point to his signature tax overhaul accelerated last year as a major accomplishment as he rallies his base. While he brags about his tax cuts and prepares to cut Social Security disability payments to save Social Security, the federal debt will explode and the rich will get even richer. Six of America’s biggest banks have enjoyed a windfall of $32 billion while curbing new borrowing, cutting jobs and ramping up dividends to shareholders.
The six largest banks in America noted are JPMorgan Chase & Co., Bank of America Corp., Citigroup Inc., Wells Fargo & Co., Goldman Sachs Group Inc., and Morgan Stanley reported their earnings last week; while doing so showed Trump’s tax cuts saved them $18 billion in 2019, even more than they reaped in 2018. Trump and his GOP cabal lowered their average effective tax to 18% from 20%. President Trump lowered their tax rates from 30% the effective rates between 2013-2017. This proves it wasn’t Hillary Clinton who was out to make Wall Street’s cronies richer it was him all along. During the same month, former Senator Clinton was exonerated of many of the crimes she was accused of by Donald Trump by the U.S. Justice Department.
You’ll remember that the GOP Congress, Senate and Trump Administration refused to wait for the Office of Budget and Management to score (figure out the cost ) Trump’s signature tax overhaul in 2017 while the debate raged over its cost. Without a care about exploding the federal deficit, Trump signed these tax cuts to the wealthy it into law near the end of his first year in office and went on to Mar a Largo to brag to his club’s members; he just made them all a lot richer.
Trump’s signature tax overhaul is worsening inequality by favoring the wealthy and inadequately stimulating economic growth. Banks used to pay higher tax rates, averaging 30%, than many other industries, but now are swimming in profits while America’s taxpayers are set to be left with the exploding debt.
Trump will campaign telling his followers that by lowering tax rates to mega-wealthy banks, corporations and the richest 1% it’s fueled the economy and has helped propel investment in expansion, lowered the unemployment rates and raised pay.
The reality of what’s happening with these six largest banks is shocking,
Loans from these six major banks slowed to 1% in 2019, which is a net loss of 3% from 2018, which was unchanged from 2017. Trump’s tax cut didn’t expand lending.
- The six banks actually as a group cut their workforce by approximately 1,200 people by the end of 2019 since his tax cut was passed. Some of these six banks raised base pay and handed out special bonuses. The banking industry as a whole is making investments in technology to automate and eliminate jobs.
- Wall Street’s shareholders were, in fact, the biggest beneficiaries. After the Federal Reserve’s 2019 mid-year stress tests, the six banks all announced plans to boost stockholder payouts by $21.5 billion, an increase of 14%.
So after bailing these banks out from the 2008-2009 financial crises, Trump has delivered these very same banks record profits. Combined, these six banks reported $120 billion in net income in 2019, surpassing 2018. Keep in mind that these six banks had never surpassed $100 billion in earnings before the Trump/GOP 2017 tax cuts.
Trump’s efforts to ease financial regulations on banks and industry acknowledged that he'd been a windfall for banks and mega-sized businesses. At a gathering of corporate leaders this past Wednesday to celebrate his trade deal with China at the White House, he told a senior JP Morgan executive the nation’s largest bank should thank him.
“They just announced earnings and they were incredible,” “I made a lot of bankers look very good. But you’re doing a great job.”