In case you haven’t been paying attention, the new tax law has dramatically lowered corporate tax rates. It could be argued that corporations were the primary beneficiaries politicians had in mind.
Wisely, rather than highlighting the billions slashed from their future corporate tax bills, the headline grabbing figure most often cited by companies has been $1,000. That’s the level of bonus that company after company has settled on sharing with their workers. It was clearly viewed by executives and board members as a nice, round figure, full of sound and fury and signifying (nearly) nothing.
The partial list of companies announcing one-time, $1,000 bonuses includes Disney, Home Depot, AT&T, American Airlines, Bank of America, Fifth Third Bank, Comcast, Jet Blue, Southwest Airlines, US Bank and Walmart.
Looking beyond the obvious PR benefits, and without completely discounting the value $1,000 is to many strapped workers, two things about it all strike me as fascinating.
First, it’s nearly impossible not to notice the “follow the leader” mindset at work in today’s executive suite. I suspect many of them went to the same business school or are members of the same social clubs. Certainly, they all watch CNBC and read the Wall Street Journal. To so quickly parrot one another, as if $1,000 was derived with forethought and analysis, is a little comical.
Second, it’s also impossible not to notice the lack of workers’ bargaining power in today’s economy. In the absence of labor unions, most workers are an outgunned and outmanned one man army.
Notably, Larry Fink, CEO of one of the largest investment managers in the world, recently sent an open letter to the leaders of today’s major corporations. Departing from the clubby world in which he no doubt lives, he courageously implored companies to act beyond their profit motives and embrace their greater “social purpose.”
He cited a “paradox” in today’s economy where companies and their investors are enjoying “high returns” and rank-and-file workers are experiencing “high anxiety.”
Regardless of the specifics of Fink’s letter, the lasting impression of his letter for me was just how far the pendulum has swung in the direction of corporate interests when an insider feels the need to send that message at all.
To close with a burning question, when corporations start getting asked to fulfill a greater social purpose, is it appropriate for us to ask if our elected officials have lost
sight of their own?
It all reminds me of my kids’ pre-school days in response to them always wanting a little more; “You get what you get and you don’t get upset!”
Speaking of fulfilling a greater social purpose, you are invited to the upcoming Money Series presentation by local attorney, Diane Kuhn Huff, where she’ll provide an invaluable (and free) lesson on estate planning on Wed.,February 7 at 6:30pm in the McGuire Rm. at the Traverse Area District Library. To register, visit www.FrontStreetFoundation.org or
call (231) 714-6459.
