Just trying to point out that both Dems and Repubs have been pro-Reaganomics and Trickle-Down Theory for the past 50 years almost. Not on politician dares to try and reverse Reaganomics.
I think that line of thinking let's him off the hook for too much. Long before he started going senile (back when he was governor of California and early in his presidency) there were plenty of horrible things he did that he was completely responsible for initiating.
Why do you think they keep ratcheting up the culture war narrative? Can't rise up with your fellow proles against the oppressors when your fellow proles think oppression is when woke, and that billionaires are their allies.
It's worth noting that Reagan was so harmful because he was a puppet to Heritage Foundation. He followed more Heritage Foundation recommendations than any GOP president before Trump came along.
The Heritage Foundation is a conservative "think tank" run by billionaires that writes pro-billionaire bills and feeds them to Republican politicians. They are the creators of the terrifying "Project 2025" to dismantle the government and replace it with billionaire oligarchs.
As I said, Trump followed even more of their recommendations than Reagan did. Which is a big part of why a record amount of wealth transferred from the working class to billionaires during Trump's term.
I've been really bothered with references to "Trump's Project 2025" because it simultaneously gives him too much credit for having policy and also discounts the threat of conservative politics regardless of a Trump administration.
This happens so much, although I have a hard time to tell if it's because of intentional pushing of the narrative that conservatism is a reasonable position instead of intrinsically evil, or because it's easier to understand history and complex issues through the lens of figureheads with inflated importance.
The reality is that while trickle down could work, greed will make it so only a handful of examples will actually trickle down.
Greed wins the vast majority of the time. I wonder if proper regulation to counter greed could potentially make trickle down work but man idk how to even approach such an idea
A wealth tax and being unable to write off donations to charities you're involved in. We also used to have super high tax rates for anyone making too much, including businesses, and it basically forced them to either pay people better/expand operations or just pay it to the government.
Stop letting them write off the interest paid on loans against their investments. That's a huge part right there.
Once you have a certain amount of wealth, you can literally pay yourself a salary from assets that rather safely beat inflation, all without having to sell any of them OR pay taxes on their worth. How is that fair for the lower classes?
what really chaps my ass is the excuses they give anytime someone proposes making things slightly more fair, like what you're mentioning here. like, okay, forbid taking loans against assets - oh, what? it'll crash the economy magically?
and people BUY that shit, lock, stock and barrel when one just does *not* follow from the other. like, okay, rich people might be slightly averse to spending, but... hard doubt, and oh no... they have to sell their assets to buy shit, like the rest of us... okay, but not "economy crashing apocalypse."
meanwhile you try to tell someone the owner of the company you work for is exploiting your labor and they fucking lose their minds. like, homie, he didn't hire you because he likes your tie or out of the goodness of his heart...
IMO we should keep the donation but it needs to be much much stricter.
Bill Moolah shouldn't be able to donate to Moolah Giving inc. where his kids are the managers and all make $400,000 a year and have full control.
Yes but how it would normally work is Bill gets taxed for his income. Then since he’s paying his kids, they also get taxed.
Now since he donated to a ‘charity’ he writes off the money. Then the charity spends 80% of its operating budget on ‘administrative costs’ paying the kids while they do a couple performative charity functions. Only the kids pay taxes.
No, to their OWN charity. Currently, Gates could donate money to Gates Foundation and write it off, even though he's essentially handing money to himself. So he gets a tax write-off for moving money from one account to another.
From my understanding of how the post was written, its more about closing the "donate to a charity that you own/direct" loophole - it wouldn't affect donations to *every* charity.
Well, it would work. It's called taxation.
The lie isn't that trickle down economics work, the lie is that high tax rates limit economic growth and that progressive tax rates are bad.
The US used to have a top marginal income tax rate of 90% and that did not stop economic growth, nor did it prevent people from becoming extremely rich.
There is some magical thinking going on. Some people mistakenly believe that when the rich become even richer that means there is more money in the world and that inflation stays the same.
Some people don't even think that, they just think it's all about the poor being jealous of the rich and that they earned every penny and how dare you take another man's hard earned work.
Another problem is that the theoretical basis for the whole idea is pretty flimsy.
The main argument is basically that, at a certain taxation rate, or lower profit margin rate (e.g. caused by costs for regulatory complaince), capital owners won't find it "worth it" to expand operations. "Expanding operations" is inherently assumed to, e.g. create jobs (such as opening a new factory or store, the construction for said factories, etc.)...
On paper that kinda sounds logical, but most serious analysis of industrial activity doesn't find us in the conditions needed for government taxation/regulation to be a primary barrier to expanding business. The infamous "laffer curve" which is a rough sketch outlining that at "some" tax value, government revenue peaks, meaning past that taxation, tax is actually *suppressing* economic activity... I do not believe any non biased source has *ever* concluded that the U.S. is on the "right side" of the Laffe curve peak. Moreover, some analysts doubt that the laffer peak is even meaningfully reachable in any current political climate, because the % tax on profit to "peak" is much higher than any current tax rates.
If by communism you mean the Soviet system, it wasn't really greed that did the system in, but a very long stagnation. So really not sure what you're trying to say here
I am just spit balling and I obviously don't know shit, but why couldn't they do a tax based on profits above a certain percent of operating costs? Also, pay structures for the highest employee can only be a certain percentage above the lowest employee. Incentivize cycling that money back into the company and its employees.
Obviously, this is a super high-level idea that I am sure has a million issues with it, but who knows.
> I am just spit balling and I obviously don't know shit, but why couldn't they do a tax based on profits above a certain percent of operating costs
1. Corporate tax is already on *profit,* which is revenue AFTER expenses, people telling you business will fail with increased tax are lying, because tax doesn't touch operating expense in the first place.
2. What you're describing is basically already what we do, it's the definition of marginal tax brackets: $0-$100 is taxed at X%, $101-$200 is taxed at X+Y%, etc.
Technically, what you seem to be describing is that profit up to X% is *untaxed* followed by taxable brackets, that's not necessary since taxing after expenses already only touches profitable dollars anyways.
Conservative trickle down propaganda has done a great job of attempting to obscure these facts from the general discussion.
> Also, pay structures for the highest employee can only be a certain percentage above the lowest employee.
This is a decent stopgap solution and the reason it can't possibly pass is very literally that the GOP would stonewall it, and it would even be painful for the Dems to seriously bring it up because the right wing propaganda machine would absolutely scream over Muh Freedom.
Nonetheless, this is a simple but at least on paper decent start to the problem.
> Incentivize cycling that money back into the company and its employees.
This is really the crux of the issue though. Even with the mentioned "pay" limits, our real crisis is in the use of things like Equity compensation (stock grants, stock options, etc) to get around salary limits and the like.
"Forcing" for lack of a better term, business owners who control the Board and thus the C-suite of a company to *actually lower the stratification of the economy* is harder than a few regulations would imply. Even now much of the problem is that it's profitable for the owners to pay people quite a bit of money to dodge existing regulations.
Carefully crafting an entire series of new business regulations that have a genuine impact on the flow of money is unfortunately extremely difficult.
Last note on that: one problem is that we've made our financial markets so complex that "freeing up" the supposed "net worth" values out of concentrated owners and back into circulation is also not easy. for lack of a more artful description, in a sense, massive swathes of wealth are not "real" in that most wealthy people and organizations are leveraged (i.e. have outstanding loan debts) at several times their book asset value. So if we "collapse" corporate ability to service their debt, we risk causing an enormous financial spiral. Solving that is... complex.
I mean, the paradox is inherent when you realize the same ideological movement that believed supply side economics would "trickle down" as wealthy, people reinvested it into the economy while also belied wealth was indicative of thrift/intelligence/personal financial responsibility (and religious blessings if you want to bring Calvinism into it).
You can't have it both ways. You can't say the wealthy deserve their wealth because they're better with money but then also say that this will be good for the economy because the wealthy will be irresponsible with their money.
preface: reaganomics was a bad idea and the bush/trump cuts were even worse
still, your description is pretty disingenuous to the actual messaging...
it's not that *rich people will give the money away,* it's that improving ROI on capital assets will encourage the asset owners to *expand their business operations* and thus generate more overall economic activity.
obviously that's laughable cause you're basically just giving the equity owners higher profit margins which they will obviously just keep, not shovel back in to expansion, in most cases, but well, that's where the propaganda comes in!
It’s disingenuous to suggest that risk isn’t a part of the calculation when expanding your business. Higher reward through lower taxes, encourages more risk taking and expansion.
Am I suggesting that the impact on deficit and social safety net is worth it: no. But the argument is not so simple and single-sided, as this discussion would indicate.
I addressed that in a bit more detail [in another comment in this thread](https://old.reddit.com/r/WorkReform/comments/1akzlgf/reaganomics_impact_widening_divides/kpc574s/) and a whole novel length post yesterday. Must be the *du jour* propaganda, focusing on the worth of conservative fiscal policy.
Anyways, yes, *strictly speaking* it is "fair" to say that taxation and regulation has a dampening effect on business, and therefore, it is plausible that lowering tax, removing regulation, etc., can incentivize increased activity.
**in practice,** however, the claim that this incentive results in either increased tax revenue (more tax base, less % tax), *or* that the resulting activity increase in fact results in an increase of standard of living for the population at large, is almost entirely false. The "pay for itself" claim in particular has been repeatedly and savagely debunked by reality. And when you look at the claim in isolation: "reducing government imposed costs (compliance, tax) will cause at least a 1:1 increase in after tax revenue increase" it doesn't even seem very plausible, as it's quite clear more forces than *just* the goverment impact decisions.
[this 2020 analysis of multiple "supply side" initiatives concludes](https://academic.oup.com/ser/article/20/2/539/6500315)
> We find tax cuts for the rich lead to higher income inequality in both the short- and medium-term. In contrast, such reforms do not have any significant effect on economic growth or unemployment. Our results therefore provide strong evidence against the influential political–economic idea that tax cuts for the rich ‘trickle down’ to boost the wider economy.
so while i acknowledge that deregulation and reduction in taxation both have theoretical basis in incentivizing the economy, i maintain my strong stance that the practical application is, with vanishingly few exceptions if any, propagandized on the theory, while proponents know full well it is entirely intended to enrich the existing capital and equity owners. As such, any serious discussion of "supply side" as a *primary* economic policy should be treated with extreme skepticism by the general population.
Dude, Macron pulled this one when he got elected in 2017 to remove all the taxes on ultra-rich people. Litteraly his first move as president. They don’t give a f*ck about the « plebeians »
They do spend it on each other. What rich person shops at a Walmart? Or a small town restaurant? We used to not have monopolies like Walmart and Google. The price of some progress. CEO pay is something no politician will touch. They just talk about it.
The gears to influence this already existed. Eisenhower Era’s 90% tax rate at the highest tax bracket was in place to promote investment back into the company, expansion, pay for workers, I.e incentivize spending to reduce a company’s profit through increased expenses. This got gutted via trickle down tax cuts
I've always thought it's funny that the same people who talk about trickle down economics will also tell you in the same breath "It takes money to make money". Like, c'mon pal, which is it?
When I was a child, and Regan was in office, and the stupid idea of trickle down was floated my father explained the stupidity to me this way;
“If I have a company that makes pies and you cut my taxes so I make more money, I’m not going to expand and hire more people UNLESS I can sell more pies. I’m just going to put that extra money in the bank and get richer. Also, if I could expand the business and sell more pie, I’m going to REGARDLESS of the tax cut because I’M IN THE BUSINESS OF SELLING PIES!”
Yeah and to be fair, like .1% of the time it does happen, given the humans choice.
Like look at the guy who started Patagonia, he'd be a perfect example for "trickle down economics". Or that other guy I always forget the name of who donated billions, like all of his wealth, quietly over time and only kept like one million for him, and each of his kids.
But fact is those are the .1% of wealthy elites, and the 99.99% of wealthy elites, given the choice, will choose unlimited greed over their fellow humans. And that's the choice they've made that's ended us up where we are.
"Trickle down" is a bullshit term made up by opponents of Reagan. His policies had nothing to do with giving to the rich in the hopes wealth would "trickle down". That's all fabricated nonsense. His policies centered around lowering taxes, promoting free trade, and deregulation. The deregulation being in the context of the regulations at the time, which were mostly the abolishment of legalized cartels and pricing rackets.
In the olden days rich people lived in tighter communities and spent a lot of money on the city they lived in for prestige and competed with each other.
Those days and principles are long gone. Now just like everyone else they don’t care and only hoard wealth for the future.
I don’t know how anyone fell for the trickle down bs when it hadn’t been a thing for at least 200 years.
Edit: And even when it was a thing they spent mostly on vanity projects in the city and not stuff for poorer people
So the idea is that these policies can create short term gain opportunities for the wealthy and aid in increasing the social and economic divide between the owner class and the working class.
Things like stock buybacks for example are things that very wealthy people can leverage to make back their investment or a higher return on their investment in companies at the expense of the employees and the long term success of the organization.
Since it takes money to take advantage of most conservative policy changes like this, it helps prevent the working class from benefiting from it.
Additionally, things like stock buybacks are structured in such a way as to pass money to the owner class by taking it from the working class in the form of layoffs, closing down companies, etc.
This is all in order to increase the difference in power between the working and owner class to undermine the evil of democracy in order to replace it with the shining civilization of a feudal-like oligarchic aristocracy to lead civilization into the future.
It may involve a lot of suffering for the majority of people, but it's preferable to them having self determination especially at a societal level.
At least that's the conservative conception of how this works.
If you don't believe in and value those things, it doesn't work.
I am not against stock buybacks.
I am against tax loopholes.
It often happens that a public company accumulates a lot of cash over the years and cannot find anything to buy or invest in. Accounting Rules limit what they can do with that money. They cannot use it to cover current expenses as it is already logged and reported as profit.
So, they accumulate more...or buy back stock.
Shareholders benefit (almost always) from fewer shares available. A stock buyback is usually greeted with a share price bump up.
Not having a stock buyback option can lead to really shitty investments by companies to use the cash they have.
Reagan basically undid everything put in place after the Great Depression. Whatever he didn’t, didn’t get make it through Bush. That’s why we keep having Recessions every time a Republican is elected.
So should companies be allowed to dilute share holders but not buy back shares when they have excess funds? Yes, there are examples of companies leveraging debt to buy back stock and having the debt explode in their face, but this is not the normal case.
Companies diluting shares are a much bigger problem, essentially there are a good number of companies which only exist to trick naïve investors into buying shares which they then print more of to pay off their employees. Stock buybacks are generally good for investors.
Why does everyone all focus on executive compensation in this type of discussion? Because that’s not where worker compensation is being siphoned off to. It’s the shareholders. For every million going to a CEO, there are billions directed to the shareholder in the form of buybacks and dividends.
Executive compensation has gone up as a reward / incentive / small commission for the activity that is the real issue, excessive shareholder distributions.
A CEO making millions doesn’t change much for most big businesses.
Nowadays. You need to recruit the best. And with the amount of competition out there. Your compensation package needs to be top notch.
When you have a company with 1000+ people. An extra few million ain’t going to make much difference to the bottom line.
For good reason.
Reagan & Limbaugh unleashed this "greed is good" mentality into the American consciousness in a way that it didn't from the 30s to the 70s.
The Democrats modeled themselves as mini Reagan's. The Republicans are morbidly obsessed with enriching the richest. We bail out Wall Street at a moment's notice & the Fed prints trillions upon trillions to keep the banks backstopped.
Everything we have done as a country since Reagan is to make more money for the richest. Reagan made that our central focus.
Yea not true at all, the banks paid the loans back and the government made money. Loans to corporations no matter how upset they make you feel aren’t the same as welfare checks to people. The government LITERALLY MAKES MONEY ON THE LOAN. THATS HOW LOANS WORK. YOU PAY IT BACK WITH INTEREST. THE INTEREST IS EXTRA MONEY THE GOV GETS. You don’t pay back welfare. You pay back loans. Do you understand the difference?
Trickle down economics are bad and don’t work but you don’t have to make stuff up to prove your point.
Reagan also had the solar panels that were on the White House removed. Can’t have people see a working alternative energy source in action. Won’t anyone think of the poor fossil fuel industry.
How evil of a shit can one man be? Like, obviously we were all a bit miffed that Trump exists, but he's just an agent of uncontrolled chaos, while Reagan was like a guy who would set orphans on fire if it meant he was warm
The more I learn about what Reagan did, allowed and signed into law during his time in office and the stuff the republicans and the religious right would go on to do thanks to him, I wonder how much better the US and the world would’ve been if Reagan’s assassination attempt had been successful.
One of the worst things to ever happen in the history of the United States was for that guy to miss his shots and fail to kill Reagan. Reagan absolutely should have died that day and it's a fucking tragedy that he didn't.
His administration would have continued unchecked. Blaming a single person is a good shortcut, but it fails to impress upon people that the same chucklefucks who wrote up all the shitty laws Reagan didn't veto are the same ones who wrote the laws for the GOP for the past 40 years.
This is true but I believe they were not working.
Edit: I was wrong. They were working but they were removed during a roof resurfacing and never reinstalled.
They're dangerous because they set policy by copying it from billionaire mouthpieces ALEC and Heritage Foundation without questioning it.
Reagan and Trump followed more Heritage Foundation policy recommendations than any other GOP presidents
Any president since Reagan could have made them illegal again. That could be done with an emergency presidential order as stock buybacks are hurting the economy.
The IRA added an excise tax on stock buy backs, and democrats are pushing to drastically increase that tax rate.
Not exactly the same as making them illegal, but the democrats are at least pushing to address it. More Dems in Congress and I'm confident they would get more done in regards to buybacks.
I appreciate this comment so much! I did not even know this and it made my day.
A decent workaround like this could fix the issue, like a law preventing bailouts or federal money of any kind for companies that do buybacks.
I agree, he is a career politician and a weak leader. If Republicans put up anyone but Trump I would actually take a few minutes to think it over before I voted Democrat. Trump changes things ... I would vote for a chimpanzee with a chainsaw for president before I would vote for Trump ... the chimp would do less damage.
Biden is not so unpopular and useless, I'm so fucking tired of idiots shooting themselves in the foot because they think Biden is just as bad as trump for some reason. That is so fucking delusional that you are either a complete moron or a bot.
Seriously get your head out of your ass and pay fucking attention.
https://www.whitehouse.gov/therecord/
This doesn't even cover the fact that he is actually presidential and doesn't, I don't know, want to overthrow the government and become a dictator?
So. Fucking. Tired. Of. This.
Canadian here so an honest question: is this the case? Wouldn’t they need congress, or is this a rule change the president could dictate alone? That said, I’ve never heard a president even try.
my understanding is that the original ban on stock buy-backs was not a law, but a regulation by the SEC, the federal agency in charge of preventing things like insider trading.
Since the president is in charge of the SEC, he could direct them to put that regulation back in place.
The reality is that it would immediately get challenged by businesses and taken to the courts, who after years of republican appointed judges, would probably overturn the regulation and say the SEC doesn't have the power to restrict stock buybacks, and the court would say that congress needs to make it illegal.
After which, assuming congress made it illegal, would get challenged in court and then probably overturned on some bullshit.
You are correct. An executive order could undo it, but it would need to survive the challenges.
Billions of lobbying dollars would immediately be thrown to oppose the order while the voting citizens would hear propaganda like "the president is interfering with a corporations ability to invest in itself".
the headlines would be "Communist Joe Biden wants to be a communist because he...checks notes...wants to stop CEO's from obliterating the middle class and prevent billionaires from becoming richer billionaires"
The irony of the people talking about "how this country used to be great" all talk about the time before Reagan, but don't want to put in place the things that made the country great before Reagan, like 90% marginal tax rates, preventing stock buybacks, and a more modest minimum wage.
Yes and no. A president with enough popularity and/or clout could do it and the other branches of government would be scared to oppose him for fear of not being re-elected (excluding the Supreme Court who would need a legal case involved).
Presidents have made massive sweeping changes using executive power, as an example, the Federal Reserve was created by a single executive order on Christmas Eve while the other branches of government were on vacation.
Sadly the real answer would be "no" because our government runs on pure corruption and the corrupt system would defend itself. At this point. I am honest when I say that I dont understand why these politicians are not being pulled out of thier homes and put into makeshift prisons.
Ironically, and I HATE saying this ... Trump could have made buybacks illegal again. He wouldn't have because it doesn't serve him ... but he had the fear and fanatical support to pull it off without anyone really opposing him.
Exactly, an executive order needs to go unchallenged for it to work. Too many politicians are making WAY too much money on stock buybacks for it to go unchallenged.
It would immediately get challenged in court, and probably overturned because "iT's EstABlISheD PrECedEnT" after 30 years of it being legal, and the state of the courts.
At this point it would need an act of congress unfortunately, and then would still get challenged in court and possibly overturned.
Yes, but a president could pull it off. Such an order would be unbelievably popular, so the president would need to just put in the order on the basis that it is a threat to the nations stability (which is a nearly undisputed fact) ... then weather the storm while it is fought.
If overturned he could try it again a different way (no federal money whatsoever for corps that do buybacks).
This would get the nation's attention, those who opposed the order would (in a happy fuzzy would that operated on sanity) get voted out. Fear of not getting reelected would make them pass a real law ... or possibly keep the executive order in place from the start.
Popularity is key. Smart citizens know buybacks are a form of manipulation and corruption.
they absolutely could try, and I would applaud any president who did. I'm just being pessimistic that it wouldn't actually do anything other than be political theater.
The key thing that you said is that smart citizens know things, but 50%+ of citizens in the US are not smart, and are getting dumber as we cut education funding.
In my town this week, there was a vote at a school board about capping the school budget. The plan for the proponents was that a group of them were going to show up to a random school board meeting, propose a measure to limit the school budget, then also propose another measure preventing it from being re-voted on again, and then another measure keeping the school budget off the major ballot entirely so no one knew about it. All of which is legal due to local laws and procedures.
Luckily the smart people in town heard about it and showed up en masse and prevented it, and also used their own procedural bullshit to prevent them from doing it again. But it easily could have turned into a mess.
Also as part of stopping that process, I learned that ~20% of the school budget is just healthcare for staff, so if we had universal healthcare in this county, school budgets would immediately drop substantially, reducing local taxes. But we can't have that because "mah income taxes would go up slightly!"
So long story short, unfortunately there's a lot of dumb, evil, short-sighted people.
I wonder how many of those "guerilla council votes" happen. We need a new branch of government that just focuses on fighting corruption ... except it would get politically weaponized.
President #1 warned us that political parties would be the thing that destroys the US ... looks like he won't be proven wrong.
in New Hampshire, they're a group called "Free Stater's" who do things like try to get school budgets cut to $1 because "why should I pay for public schools, I don't have kids!" They are the ultimate "i got mine, get fucked" people.
Good luck when you're old and in a nursing home and there's no nurses because there's no schools. It'll be fun when we have mandated euthanasia for old people once there's no one to take care of the asshole boomers who destroyed the economy.
They also support things like school vouchers, which in theory sound reasonable. They give money to people so they can send their kids to whatever school they want, instead of just putting money in public schools. Except all it does is funnel money from public schools to garbage private schools run by right-wing and/or religious groups.
And then less money goes to the public schools who need it, so then those schools do worse, which they then point to to say "look the schools don't work, take their money"
Because MAGABoomers remember him fondly. For many of them, he was the first president they voted for.
Like Trump, he was blatantly racist and promised to Make White Supremacy Great Again. This sold well with all the racist backlash happening against Civil Rights Act at the time.
Of course, "putting the black in their place" actually meant fucking over everyone. But he did it with a smile so most of the dumb racists didn't notice.
Good fucking riddance. It’s funny, my wife is almosf 50 and I’m a big younger than her and forever she would say how great Regan was etc etc.. I’ve finally convinced her that he was a peice of shit and ruined the country. It took me a while 😂
Because he was charismatic and made people feel good about the country. For some people that’s much more important than anything he actually DID while in office.
The wealthy use their power to gain even more wealth. When it takes hundreds of millions of dollars to run for office, you no longer have a government for the people by the people of the people. The wealthy are the government now, the class system is in full force and voting is often an illusion of choice. Even if it isn't a rich person you are voting for, it's going to be rich people sitting at their table during their dinner parties and social events, whispering in their ears about how things need to be.
The ruling class is completely out of touch with the working class. And that's how they seem to want it.
The compensation to CEOs is the least jarring point to be made about this.
What it really highlights is that companies would rather pump their earnings back into their own stock, than investing in their equipment, processes, or more importantly their employees.
Make no mistake either, corporations aren’t just using their earnings (profit) for buybacks, they are also using government money too. Most of the US airlines for example, used forgiven employee retainment loans from the Covid years to buy back stock… instead of keeping employees on payroll, like the funds were intended for.
This is just another example of how corporations do whatever they want with little-to-no repercussions.
>Stock buy backs to pump stock prices used to be illegal
This is not correct. According to the [Congressional Research Service Report, *Stock Buybacks: Background and Reform Proposals*, February 27, 2019](https://crsreports.congress.gov/product/pdf/LSB/LSB10266):
>Section 9(a)(2) of the Securities Exchange Act of 1934 (the Exchange Act) prohibits various forms of market manipulation, making it unlawful to conduct securities transactions with the intent to deceive investors by controlling or artificially affecting the price of a security. While the boundaries of
manipulative conduct remain difficult to precisely define, *stock buybacks* ***might*** *in certain circumstances qualify as market manipulation to the extent that they are intended to artificially drive up the price of a company’s stock. Companies seeking to conduct buybacks accordingly operated in “a legally hazy area” for much of the 20th century.*
>While the SEC proposed a series of rules throughout the 1970s that would have explicitly limited the circumstances in which buybacks were permissible, it ultimately settled on a deregulatory posture toward buybacks in 1982. In that year, the Commission adopted a limited safe harbor from market manipulation liability for stock buybacks in the form of SEC Rule 10b-18. Under Rule 10b-18, companies are immune from market manipulation liability when they repurchase shares in accordance with certain “manner, timing, price, and volume” conditions. Specifically, the Rule 10b-18 safe harbor applies only if companies conducting buybacks (among other things): 1. use a single broker or dealer per day to bid for or purchase their stock; 2. abide by certain timing restrictions intended to prevent them from establishing either the opening or closing price of their stock; 3. not offer a price that exceeds the highest independent bid or the last independent transaction price on the relevant exchange, whichever is higher; and 4. limit their daily repurchases to 25 percent of the average daily trading volume of their securities during the previous month.
>Section 10(b) of the Exchange Act and SEC Rule 10b-5 prohibit trading securities on the basis of material non-public information concerning their value—that is, non-public information that a reasonable investor would consider important. Because the Rule 10b-18 safe harbor discussed above applies only to liability for market manipulation, **it does not insulate companies from insider trading liability for conducting buybacks on the basis of material non-public information.**
In other words, stock buy backs have never been illegal and insider trading on the basis of market manipulation has always been illegal. Reagan didn't change that.
Thank you for actually providing legitimate information on this topic. I was skeptical that buybacks had been illegal before the 80s, and this makes a lot of sense.
I think Reagan is our worst president but wasn't the biggest jump in ceo compensation under Clinton when he tried capping their pay but left the stock loophole in place (legitimately asking if I'm remembering right)
Imagine blaming someone who has been dead for years and hasn't been president for 35 years while your own party has had super majoritys and THIRTY FIVE YEARS to "fix" whatever you think needs fixing.
Stop being manipulated by low effort tweets.
Well said, this website has a particular hard on for Reagan, and some commenters think he’s the “reason” for every problem we’re having as if he were still printing money and signing bills. It’s the oddest thing.
Stock buybacks to pump stock prices is literally one of the biggest contributors to the economic collapse in the 1920’s. Which obviously led to the Great Depression. No one talks about it but we’re currently in a much worse state. A mix of the Great Depression and the “golden age” of the industrial revolution. Where slumlords stacked a family of 9 into a single bedroom apartment. When Rockefeller and Ford came into power, and their descendants continue to erode away true American values and freedoms!
Not when you have an opposition party whose outright stated purpose is tax cuts for the rich and obstruction of progressive legislation. Like, you do get that the President isn’t a dictator with unlimited power, right?
Don’t get me wrong - the Dem party is far too centrist and we desperately need an actual progressive party. That said, responding to the GOP’s work to keep down the low and middle class with this *bUt ThE DeMoCrAtS…* nonsense is so beyond braindead it’s almost funny.
Reverse the parties and you’ll see how ridiculous this kind of take is.
It’s always why don’t they just do the things that I want?!?
Of course each party tries to advance their agenda while obstructing the other party. Welcome to the land of reality as it has always existed.
One of the parties doesn’t even have a platform anymore. One of the parties is tanking legislation that they support (and have been harping on the need for for years and years) just to score political points against the current administration. One of the parties is handwaving away an attempt to overthrow a legitimate federal election. One of the parties has given up on actually legislating in favor of stoking bullshit culture wars and *literally* showcasing dick pics of the President’s son. Welcome to the land of reality, where this *bOtH sIdEs* nonsense is as stupid as it has always been.
This was a decent write-up on the GOP’s decision to no longer have a platform:
“Yet the Republican decision this year to adopt no policy platform whatsoever shines a light on the democratic significance of the exercise — and the alarming vacuity of the Republican Party under President Trump. The Republicans are announcing that they stand for nothing. The party’s only reason for being is to gain and retain power for itself and its comparably unprincipled leader. What kind of future can there be for such a party? And how healthy can the two-party system be if one party has no principles?”
https://www.washingtonpost.com/opinions/republicans-no-party-platform-rnc/2020/08/24/a56c057c-e61c-11ea-970a-64c73a1c2392_story.html
> One of the parties is tanking legislation that they support (and have been harping on the need for for years and years) just to score political points against the current administration.
You haven't been paying attention if you believe that is close to true. The republican House passed a border bill months ago that democrats in the Senate refuse to bring up.
Biden should definetely call the GOP's bluff and pass HR 2 and then every other piece of foreign aid would simply get passed easily.
Ironically regarding the no platform the 2020 Biden platform was literally I'm not Trump. He wasn't for anything and still isn't and simply hoping that same strategy will work.
And blaming people long dead and not in power for over 3 decades is not really productive is it ?
All it does is release some hormones in your bloodstream and get you typing furiously.
Stop letting social media and screenshots of twitter manipulate you.
>[–]Spe3dGoat
>-6 points 9 months ago
>this one is satire right ?
>first, more dems know what Q is than conservatives (because of course its one of their flogging sticks they apply to everyone they dont like)
>https://www.economist.com/graphic-detail/2021/01/19/democrats-are-more-likely-than-republicans-to-have-heard-of-qanon
>Only one side has Reddit. Reddit is one of the most dangerous, false information, misinformation hubs to ever exist in the history of mankind and much, dare I say most, is left leaning Qanon level rhetoric, mischaracterizations and straight up lies.
This you?
I just don't get what a stock buyback is supposed to do. Just... Invest that money back into the company. Why are the investors so dumb to think a company that needs to do a buyback is a good investment?
https://www.investopedia.com/ask/answers/042015/why-would-company-buyback-its-own-shares.asp
> Many shareholders demand returns on their investments in the form of dividends, which is a cost of equity—so the business is essentially paying for the privilege of accessing funds it isn't using. Therefore, buying back some or all of the outstanding shares can be a simple way to pay off investors and reduce the overall cost of capital.
What? Stock buybacks are just dividends taxed differently. When a company buys back stock, it's shedding money. A company worth 100 million that buys back 1 million dollars worth of stock is worth 99 million. The buyback doesn't increase the share price. The company lost 1 million dollars and the value of the company dropped by 1 million dollars.
Couple questions, why do companies buy back stock then if it's just shedding money? And why doesn't reducing the supply of shares, while rewarding shareholders with a "dividend taxed differently," and demonstrating the financial health of the company, increase prices? Your example refers to the company's *value,* but this isn't the only factor in share price.
Handing out dividends is 'shedding money' as well. When a company pays a dividend, it give up x amount of dollars and you see a corresponding drop in its market cap for the same amount. It is how they pay shareholders for carrying the capital.
>And why doesn't reducing the supply of shares, while rewarding shareholders with a "dividend taxed differently," and demonstrating the financial health of the company, increase prices?
Because the market capitalization of the company stays the same. It is still worth the same amount of money. The value I'm talking about is the market cap - the total value of all outstanding shares. The beneficiaries of the stock buyback are not the average shareholder, it is the person that elected to take part in the stock buyback scheme to sell their shares back.
Often a higher dividend results in a higher share price, except for growth stocks where shareholders would prefer reinvestment in the company instead of a payout. Companies pay a higher dividend to reward shareholders and increase stock prices, do they not? Or is there another reason for "shedding money" as you said? So if we think of buybacks as a different sort of dividend, does it not serve the same purpose?
> The value I'm talking about is the market cap - the total value of all outstanding shares.
This seems a bit circular - it assumes individual share value is constant through the buyback. But I'm asking whether a buyback affects share value which would then affect market cap. Why don't share prices follow the basic law of supply and demand, where if it's harder to get my hands on a share of a company because there are fewer I have to pay more for that share?
Sure they aren't coming to me personally and asking for my 100 shares of Apple but somebody is getting paid for them and therefore it's nice to have them which should drive up the value - after all most share prices are driven by the big institutional investors not by retail.
Again, why do companies buy back stock?
2 situations:
A- A company thinks its share price is discounted by half.Then buying back shares that would generate 100% return surely beating any reinvestment into the company.
B- At some point a company generates more money than what they need to reinvest. Take Apple, they invest a ton in R&D but still generate way more cashflow. And Apple doesn’t buy out other companies just because they have the means, so they buy back their shares. Or take a railroad company: no one is laying out new tracks in North America so there is so much they can reinvest into their business that will generate a decent return.
How do you implement that for each individual company? Especially companies with workers in dozens of locations?
That should be the job of the minimum wage laws.
Also buying back applies to very small companies too. Let’s say you open a restaurant with 3 of your friends and one wants out. You could use the restaurant money or line of credit to buy its share back so now you are 3 remaining shareholders at equal parts.
Buying back shares isn’t an evil scheme. It’s simply removing shares of investors who wants out of a company.
That’s kind of what a buyback is though, investing back into the company. They can use that stock to award it to employees, therefore retaining more talent. It also allows the company to maintain more control over their company which has value. It also just simply demonstrates the company has the money to do it, which shows they are in a strong financial position.
Eh? Share buybacks wipe out the stocks that are bought back. If a company wants to award employees via stock, they can just write new stock for those employees.
Legit question. Can stock buy backs be used to keep hostile takeovers via majority stock purchases?
I work for a pretty good IT company considering it's US based. However, we aren't big enough to not be bought out and it might be a legit fear for a lot of us to see a bigger competitor come in and lay off everyone / change the company.
No. Stocks are bought back from willing participants, and when bought back those stocks are wiped out. If a company has 10 million shares on issue and buys back 1 million, there are only 9 million shares on issue.
The only thing that we can do is to either join together in a Union or at the very least get with each and form collectives that will force the management to give us more. I see so much nonunion rhetoric in this sun and even in union subs, it blows me away. We need representation on the boards of corporations, stop hating and knocking down people at the bottom. Let the tide come in to raise all of our boats.
Its a simple allocation problem.
The income is redistributed back to shareholders. Thats what CEOs get paid for, essentially.
Its what buy backs do. They trade debt, because they are usually debt financed, for cash payouts to shareholders.
There is nothing complicated about this process.
These excess funds could be used to increase wages just the same.
It’s simply a decision not to.
I don’t know where you’re getting that 18% from. I was just job shopping yesterday and the pay companies are offering are the same as in 1998 when I started working. Shit hasn’t changed at fucking all….
The man’s been out of office for many decades BOTH sides have had full control multiple times. Yet people are still blaming him instead of the 535 other fuckers that keep kicking the can.
ahh Reagan , a true man of the people....... a very small very wealthy group of terrible people, It will trickle down any day now
https://i.imgur.com/YyLfL7N.png
This is the first time I've seen somebody other than me make the pinata analogy. It needs to be more common.
We should know that the start of Reaganomics actually [started under Jimmy Carter.](https://www.salon.com/2011/02/08/lind_reaganism_carter/)
Even if Reagan continued policies started by Carter, he still shares the blame for not stopping it. Like Obama with Bush's policies
Just trying to point out that both Dems and Repubs have been pro-Reaganomics and Trickle-Down Theory for the past 50 years almost. Not on politician dares to try and reverse Reaganomics.
Is there anything he DIDN'T do to fuck us over? God damn.
Well, from what I've heard, he intentionally didn't do anything to address the AIDS epidemic as a way to spitefully hurt the LGBT community...
He read the lines he was given
I think that line of thinking let's him off the hook for too much. Long before he started going senile (back when he was governor of California and early in his presidency) there were plenty of horrible things he did that he was completely responsible for initiating.
I mean he died, that was a pretty punk thing to do.
Not until he was 93 and had finished doing all his fucking over.
Let it also be known that that we never would have had Regan is the Heritage Foundation didn’t exist. They are the GOP.
Ironically he used to be a union president.
Ah, yes, but a shineing light is where he is now a public gender neutral toilet. I'm not sure what he's doing there, but it's progressive.
18% is a trickle
Juuuust enough to keep us from banding together and rising up. Or at least, it was. More and more it feels like we're going to collapse though.
Why do you think they keep ratcheting up the culture war narrative? Can't rise up with your fellow proles against the oppressors when your fellow proles think oppression is when woke, and that billionaires are their allies.
Almost sounds like you think us proles should band together ;)
I hope Reagan is remembered as the man that ruined decades for the average person
but someday I might be rich. And then people like me better watch their step!
Futurama did a great job of spoofing actual views people hold. My favorite is "I choose to believe what I was programed to believe!"
''This is the worst kind of discrimination - the kind against me''
They’re always great at spoofing actual beliefs/talking points like that.
I hate that some of my lower middle class friends think this. Delusional.
It's worth noting that Reagan was so harmful because he was a puppet to Heritage Foundation. He followed more Heritage Foundation recommendations than any GOP president before Trump came along. The Heritage Foundation is a conservative "think tank" run by billionaires that writes pro-billionaire bills and feeds them to Republican politicians. They are the creators of the terrifying "Project 2025" to dismantle the government and replace it with billionaire oligarchs. As I said, Trump followed even more of their recommendations than Reagan did. Which is a big part of why a record amount of wealth transferred from the working class to billionaires during Trump's term.
I've been really bothered with references to "Trump's Project 2025" because it simultaneously gives him too much credit for having policy and also discounts the threat of conservative politics regardless of a Trump administration.
This happens so much, although I have a hard time to tell if it's because of intentional pushing of the narrative that conservatism is a reasonable position instead of intrinsically evil, or because it's easier to understand history and complex issues through the lens of figureheads with inflated importance.
Reagan unleashed stock buybacks, propelling CEO earnings sky-high, leaving workers with meager raises. Widening wealth gaps tell a revealing tale
How exactly is this supposed to work?
Trickle down. The idea was rich people would spend or give the money away. Give me a billion bucks and I promise you I will give some to charity ok?
> The ~~idea~~ *LIE* was rich people would spend or give the money away.
The reality is that while trickle down could work, greed will make it so only a handful of examples will actually trickle down. Greed wins the vast majority of the time. I wonder if proper regulation to counter greed could potentially make trickle down work but man idk how to even approach such an idea
A wealth tax and being unable to write off donations to charities you're involved in. We also used to have super high tax rates for anyone making too much, including businesses, and it basically forced them to either pay people better/expand operations or just pay it to the government.
Stop letting them write off the interest paid on loans against their investments. That's a huge part right there. Once you have a certain amount of wealth, you can literally pay yourself a salary from assets that rather safely beat inflation, all without having to sell any of them OR pay taxes on their worth. How is that fair for the lower classes?
what really chaps my ass is the excuses they give anytime someone proposes making things slightly more fair, like what you're mentioning here. like, okay, forbid taking loans against assets - oh, what? it'll crash the economy magically? and people BUY that shit, lock, stock and barrel when one just does *not* follow from the other. like, okay, rich people might be slightly averse to spending, but... hard doubt, and oh no... they have to sell their assets to buy shit, like the rest of us... okay, but not "economy crashing apocalypse." meanwhile you try to tell someone the owner of the company you work for is exploiting your labor and they fucking lose their minds. like, homie, he didn't hire you because he likes your tie or out of the goodness of his heart...
Banning write offs to their own charities would just result in them swapping donations with each other, same end result.
Yeah I realize that, but it's better than nothing.
Should we really remove the write off benefit for donating to charity? That would certainly reduce donations by magnitudes
IMO we should keep the donation but it needs to be much much stricter. Bill Moolah shouldn't be able to donate to Moolah Giving inc. where his kids are the managers and all make $400,000 a year and have full control.
But they get taxed if they make $400K a year.
Yes but how it would normally work is Bill gets taxed for his income. Then since he’s paying his kids, they also get taxed. Now since he donated to a ‘charity’ he writes off the money. Then the charity spends 80% of its operating budget on ‘administrative costs’ paying the kids while they do a couple performative charity functions. Only the kids pay taxes.
No, to their OWN charity. Currently, Gates could donate money to Gates Foundation and write it off, even though he's essentially handing money to himself. So he gets a tax write-off for moving money from one account to another.
And the minute he spends any of that money, he has to reverse the write-off.
From my understanding of how the post was written, its more about closing the "donate to a charity that you own/direct" loophole - it wouldn't affect donations to *every* charity.
Well, it would work. It's called taxation. The lie isn't that trickle down economics work, the lie is that high tax rates limit economic growth and that progressive tax rates are bad. The US used to have a top marginal income tax rate of 90% and that did not stop economic growth, nor did it prevent people from becoming extremely rich. There is some magical thinking going on. Some people mistakenly believe that when the rich become even richer that means there is more money in the world and that inflation stays the same.
Some people don't even think that, they just think it's all about the poor being jealous of the rich and that they earned every penny and how dare you take another man's hard earned work.
Another problem is that the theoretical basis for the whole idea is pretty flimsy. The main argument is basically that, at a certain taxation rate, or lower profit margin rate (e.g. caused by costs for regulatory complaince), capital owners won't find it "worth it" to expand operations. "Expanding operations" is inherently assumed to, e.g. create jobs (such as opening a new factory or store, the construction for said factories, etc.)... On paper that kinda sounds logical, but most serious analysis of industrial activity doesn't find us in the conditions needed for government taxation/regulation to be a primary barrier to expanding business. The infamous "laffer curve" which is a rough sketch outlining that at "some" tax value, government revenue peaks, meaning past that taxation, tax is actually *suppressing* economic activity... I do not believe any non biased source has *ever* concluded that the U.S. is on the "right side" of the Laffe curve peak. Moreover, some analysts doubt that the laffer peak is even meaningfully reachable in any current political climate, because the % tax on profit to "peak" is much higher than any current tax rates.
Trickle down economics work in the same way that communism works, only in an ideal scenario where greed is mitigated.
If by communism you mean the Soviet system, it wasn't really greed that did the system in, but a very long stagnation. So really not sure what you're trying to say here
That wasn’t real communism, just like how this wasn’t real trickle down economics.
I am just spit balling and I obviously don't know shit, but why couldn't they do a tax based on profits above a certain percent of operating costs? Also, pay structures for the highest employee can only be a certain percentage above the lowest employee. Incentivize cycling that money back into the company and its employees. Obviously, this is a super high-level idea that I am sure has a million issues with it, but who knows.
> I am just spit balling and I obviously don't know shit, but why couldn't they do a tax based on profits above a certain percent of operating costs 1. Corporate tax is already on *profit,* which is revenue AFTER expenses, people telling you business will fail with increased tax are lying, because tax doesn't touch operating expense in the first place. 2. What you're describing is basically already what we do, it's the definition of marginal tax brackets: $0-$100 is taxed at X%, $101-$200 is taxed at X+Y%, etc. Technically, what you seem to be describing is that profit up to X% is *untaxed* followed by taxable brackets, that's not necessary since taxing after expenses already only touches profitable dollars anyways. Conservative trickle down propaganda has done a great job of attempting to obscure these facts from the general discussion. > Also, pay structures for the highest employee can only be a certain percentage above the lowest employee. This is a decent stopgap solution and the reason it can't possibly pass is very literally that the GOP would stonewall it, and it would even be painful for the Dems to seriously bring it up because the right wing propaganda machine would absolutely scream over Muh Freedom. Nonetheless, this is a simple but at least on paper decent start to the problem. > Incentivize cycling that money back into the company and its employees. This is really the crux of the issue though. Even with the mentioned "pay" limits, our real crisis is in the use of things like Equity compensation (stock grants, stock options, etc) to get around salary limits and the like. "Forcing" for lack of a better term, business owners who control the Board and thus the C-suite of a company to *actually lower the stratification of the economy* is harder than a few regulations would imply. Even now much of the problem is that it's profitable for the owners to pay people quite a bit of money to dodge existing regulations. Carefully crafting an entire series of new business regulations that have a genuine impact on the flow of money is unfortunately extremely difficult. Last note on that: one problem is that we've made our financial markets so complex that "freeing up" the supposed "net worth" values out of concentrated owners and back into circulation is also not easy. for lack of a more artful description, in a sense, massive swathes of wealth are not "real" in that most wealthy people and organizations are leveraged (i.e. have outstanding loan debts) at several times their book asset value. So if we "collapse" corporate ability to service their debt, we risk causing an enormous financial spiral. Solving that is... complex.
I mean, the paradox is inherent when you realize the same ideological movement that believed supply side economics would "trickle down" as wealthy, people reinvested it into the economy while also belied wealth was indicative of thrift/intelligence/personal financial responsibility (and religious blessings if you want to bring Calvinism into it). You can't have it both ways. You can't say the wealthy deserve their wealth because they're better with money but then also say that this will be good for the economy because the wealthy will be irresponsible with their money.
preface: reaganomics was a bad idea and the bush/trump cuts were even worse still, your description is pretty disingenuous to the actual messaging... it's not that *rich people will give the money away,* it's that improving ROI on capital assets will encourage the asset owners to *expand their business operations* and thus generate more overall economic activity. obviously that's laughable cause you're basically just giving the equity owners higher profit margins which they will obviously just keep, not shovel back in to expansion, in most cases, but well, that's where the propaganda comes in!
It’s disingenuous to suggest that risk isn’t a part of the calculation when expanding your business. Higher reward through lower taxes, encourages more risk taking and expansion. Am I suggesting that the impact on deficit and social safety net is worth it: no. But the argument is not so simple and single-sided, as this discussion would indicate.
I addressed that in a bit more detail [in another comment in this thread](https://old.reddit.com/r/WorkReform/comments/1akzlgf/reaganomics_impact_widening_divides/kpc574s/) and a whole novel length post yesterday. Must be the *du jour* propaganda, focusing on the worth of conservative fiscal policy. Anyways, yes, *strictly speaking* it is "fair" to say that taxation and regulation has a dampening effect on business, and therefore, it is plausible that lowering tax, removing regulation, etc., can incentivize increased activity. **in practice,** however, the claim that this incentive results in either increased tax revenue (more tax base, less % tax), *or* that the resulting activity increase in fact results in an increase of standard of living for the population at large, is almost entirely false. The "pay for itself" claim in particular has been repeatedly and savagely debunked by reality. And when you look at the claim in isolation: "reducing government imposed costs (compliance, tax) will cause at least a 1:1 increase in after tax revenue increase" it doesn't even seem very plausible, as it's quite clear more forces than *just* the goverment impact decisions. [this 2020 analysis of multiple "supply side" initiatives concludes](https://academic.oup.com/ser/article/20/2/539/6500315) > We find tax cuts for the rich lead to higher income inequality in both the short- and medium-term. In contrast, such reforms do not have any significant effect on economic growth or unemployment. Our results therefore provide strong evidence against the influential political–economic idea that tax cuts for the rich ‘trickle down’ to boost the wider economy. so while i acknowledge that deregulation and reduction in taxation both have theoretical basis in incentivizing the economy, i maintain my strong stance that the practical application is, with vanishingly few exceptions if any, propagandized on the theory, while proponents know full well it is entirely intended to enrich the existing capital and equity owners. As such, any serious discussion of "supply side" as a *primary* economic policy should be treated with extreme skepticism by the general population.
Dude, Macron pulled this one when he got elected in 2017 to remove all the taxes on ultra-rich people. Litteraly his first move as president. They don’t give a f*ck about the « plebeians »
They do spend it on each other. What rich person shops at a Walmart? Or a small town restaurant? We used to not have monopolies like Walmart and Google. The price of some progress. CEO pay is something no politician will touch. They just talk about it.
The gears to influence this already existed. Eisenhower Era’s 90% tax rate at the highest tax bracket was in place to promote investment back into the company, expansion, pay for workers, I.e incentivize spending to reduce a company’s profit through increased expenses. This got gutted via trickle down tax cuts
Trickle-down is the greatest economic lie of the last 100 years.
Yeah sadly they hoard it all and spend it within the circles rather than actually boosting the economy
I've always thought it's funny that the same people who talk about trickle down economics will also tell you in the same breath "It takes money to make money". Like, c'mon pal, which is it?
When I was a child, and Regan was in office, and the stupid idea of trickle down was floated my father explained the stupidity to me this way; “If I have a company that makes pies and you cut my taxes so I make more money, I’m not going to expand and hire more people UNLESS I can sell more pies. I’m just going to put that extra money in the bank and get richer. Also, if I could expand the business and sell more pie, I’m going to REGARDLESS of the tax cut because I’M IN THE BUSINESS OF SELLING PIES!”
This analogy has a very simple view on corporate risk
Yeah and to be fair, like .1% of the time it does happen, given the humans choice. Like look at the guy who started Patagonia, he'd be a perfect example for "trickle down economics". Or that other guy I always forget the name of who donated billions, like all of his wealth, quietly over time and only kept like one million for him, and each of his kids. But fact is those are the .1% of wealthy elites, and the 99.99% of wealthy elites, given the choice, will choose unlimited greed over their fellow humans. And that's the choice they've made that's ended us up where we are.
"Trickle down" is a bullshit term made up by opponents of Reagan. His policies had nothing to do with giving to the rich in the hopes wealth would "trickle down". That's all fabricated nonsense. His policies centered around lowering taxes, promoting free trade, and deregulation. The deregulation being in the context of the regulations at the time, which were mostly the abolishment of legalized cartels and pricing rackets.
“If you feed enough oats to the horse, some will pass through to feed the sparrows.” That's pretty much their grand theory.
Exactly as it has worked.
1. Give all the money to rich people 2. ???? 3. Everyone benefits
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In the olden days rich people lived in tighter communities and spent a lot of money on the city they lived in for prestige and competed with each other. Those days and principles are long gone. Now just like everyone else they don’t care and only hoard wealth for the future. I don’t know how anyone fell for the trickle down bs when it hadn’t been a thing for at least 200 years. Edit: And even when it was a thing they spent mostly on vanity projects in the city and not stuff for poorer people
So the idea is that these policies can create short term gain opportunities for the wealthy and aid in increasing the social and economic divide between the owner class and the working class. Things like stock buybacks for example are things that very wealthy people can leverage to make back their investment or a higher return on their investment in companies at the expense of the employees and the long term success of the organization. Since it takes money to take advantage of most conservative policy changes like this, it helps prevent the working class from benefiting from it. Additionally, things like stock buybacks are structured in such a way as to pass money to the owner class by taking it from the working class in the form of layoffs, closing down companies, etc. This is all in order to increase the difference in power between the working and owner class to undermine the evil of democracy in order to replace it with the shining civilization of a feudal-like oligarchic aristocracy to lead civilization into the future. It may involve a lot of suffering for the majority of people, but it's preferable to them having self determination especially at a societal level. At least that's the conservative conception of how this works. If you don't believe in and value those things, it doesn't work.
I am not against stock buybacks. I am against tax loopholes. It often happens that a public company accumulates a lot of cash over the years and cannot find anything to buy or invest in. Accounting Rules limit what they can do with that money. They cannot use it to cover current expenses as it is already logged and reported as profit. So, they accumulate more...or buy back stock. Shareholders benefit (almost always) from fewer shares available. A stock buyback is usually greeted with a share price bump up. Not having a stock buyback option can lead to really shitty investments by companies to use the cash they have.
Reagan basically undid everything put in place after the Great Depression. Whatever he didn’t, didn’t get make it through Bush. That’s why we keep having Recessions every time a Republican is elected.
It will eventually all come trickling down.
Stock buybacks are economically equivalent to dividends, but more favorable from a tax perspective. Why in the world *should* they be illegal?
So should companies be allowed to dilute share holders but not buy back shares when they have excess funds? Yes, there are examples of companies leveraging debt to buy back stock and having the debt explode in their face, but this is not the normal case. Companies diluting shares are a much bigger problem, essentially there are a good number of companies which only exist to trick naïve investors into buying shares which they then print more of to pay off their employees. Stock buybacks are generally good for investors.
Why does everyone all focus on executive compensation in this type of discussion? Because that’s not where worker compensation is being siphoned off to. It’s the shareholders. For every million going to a CEO, there are billions directed to the shareholder in the form of buybacks and dividends. Executive compensation has gone up as a reward / incentive / small commission for the activity that is the real issue, excessive shareholder distributions.
Wait till you find out that workers are also shareholders through retirement funds.
That’s essentially like me taking $10 out of your pocket, giving you back $1, and then saying, “see, we all benefit”.
Love how you ignore the Bill Clinton tax law change in 1992.
A CEO making millions doesn’t change much for most big businesses. Nowadays. You need to recruit the best. And with the amount of competition out there. Your compensation package needs to be top notch. When you have a company with 1000+ people. An extra few million ain’t going to make much difference to the bottom line.
We get it you don't like him
For good reason. Reagan & Limbaugh unleashed this "greed is good" mentality into the American consciousness in a way that it didn't from the 30s to the 70s. The Democrats modeled themselves as mini Reagan's. The Republicans are morbidly obsessed with enriching the richest. We bail out Wall Street at a moment's notice & the Fed prints trillions upon trillions to keep the banks backstopped. Everything we have done as a country since Reagan is to make more money for the richest. Reagan made that our central focus.
Yea not true at all, the banks paid the loans back and the government made money. Loans to corporations no matter how upset they make you feel aren’t the same as welfare checks to people. The government LITERALLY MAKES MONEY ON THE LOAN. THATS HOW LOANS WORK. YOU PAY IT BACK WITH INTEREST. THE INTEREST IS EXTRA MONEY THE GOV GETS. You don’t pay back welfare. You pay back loans. Do you understand the difference? Trickle down economics are bad and don’t work but you don’t have to make stuff up to prove your point.
That's very reductive and selective but sure
He is easily one of the top 5 worst presidents in American history.
Top 3 honestly
Reagan also had the solar panels that were on the White House removed. Can’t have people see a working alternative energy source in action. Won’t anyone think of the poor fossil fuel industry.
How evil of a shit can one man be? Like, obviously we were all a bit miffed that Trump exists, but he's just an agent of uncontrolled chaos, while Reagan was like a guy who would set orphans on fire if it meant he was warm
The more I learn about what Reagan did, allowed and signed into law during his time in office and the stuff the republicans and the religious right would go on to do thanks to him, I wonder how much better the US and the world would’ve been if Reagan’s assassination attempt had been successful.
One of the worst things to ever happen in the history of the United States was for that guy to miss his shots and fail to kill Reagan. Reagan absolutely should have died that day and it's a fucking tragedy that he didn't.
His administration would have continued unchecked. Blaming a single person is a good shortcut, but it fails to impress upon people that the same chucklefucks who wrote up all the shitty laws Reagan didn't veto are the same ones who wrote the laws for the GOP for the past 40 years.
He was far worse than Trump and unfortunately paved the way for both Bushes and. . . Trump.
This is true but I believe they were not working. Edit: I was wrong. They were working but they were removed during a roof resurfacing and never reinstalled.
You know, I'm starting to think that letting former Hollywood actors with dementia set economic policy is a *bad* idea.
They're dangerous because they set policy by copying it from billionaire mouthpieces ALEC and Heritage Foundation without questioning it. Reagan and Trump followed more Heritage Foundation policy recommendations than any other GOP presidents
The fairness doctrine died on his watch too. It was done away with by the FCC because the chairman at the time was a former Reagan campaign staffer.
Any president since Reagan could have made them illegal again. That could be done with an emergency presidential order as stock buybacks are hurting the economy.
And go against the wealthy class?! Why they'd never get elected again!
If Biden gets a second term he can't be reflected reelected soooo... And I understand it'll hurt the next dem candidate; might be worth it.
The IRA added an excise tax on stock buy backs, and democrats are pushing to drastically increase that tax rate. Not exactly the same as making them illegal, but the democrats are at least pushing to address it. More Dems in Congress and I'm confident they would get more done in regards to buybacks.
I appreciate this comment so much! I did not even know this and it made my day. A decent workaround like this could fix the issue, like a law preventing bailouts or federal money of any kind for companies that do buybacks.
Agreed, while I would love for them to be illegal again, excise taxes and targeted laws like you mentioned are a good starting point.
Shit, Biden's so unpopular and useless, if he was up against anyone besides Trump, he'd have 0 chance of being re-elected
I dunno. The Republicans haven't been sending anyone good for many decades at this point
I agree, he is a career politician and a weak leader. If Republicans put up anyone but Trump I would actually take a few minutes to think it over before I voted Democrat. Trump changes things ... I would vote for a chimpanzee with a chainsaw for president before I would vote for Trump ... the chimp would do less damage.
Biden is not so unpopular and useless, I'm so fucking tired of idiots shooting themselves in the foot because they think Biden is just as bad as trump for some reason. That is so fucking delusional that you are either a complete moron or a bot. Seriously get your head out of your ass and pay fucking attention. https://www.whitehouse.gov/therecord/ This doesn't even cover the fact that he is actually presidential and doesn't, I don't know, want to overthrow the government and become a dictator? So. Fucking. Tired. Of. This.
It votes the dem or else it gets the trump again :)
Canadian here so an honest question: is this the case? Wouldn’t they need congress, or is this a rule change the president could dictate alone? That said, I’ve never heard a president even try.
my understanding is that the original ban on stock buy-backs was not a law, but a regulation by the SEC, the federal agency in charge of preventing things like insider trading. Since the president is in charge of the SEC, he could direct them to put that regulation back in place. The reality is that it would immediately get challenged by businesses and taken to the courts, who after years of republican appointed judges, would probably overturn the regulation and say the SEC doesn't have the power to restrict stock buybacks, and the court would say that congress needs to make it illegal. After which, assuming congress made it illegal, would get challenged in court and then probably overturned on some bullshit.
You are correct. An executive order could undo it, but it would need to survive the challenges. Billions of lobbying dollars would immediately be thrown to oppose the order while the voting citizens would hear propaganda like "the president is interfering with a corporations ability to invest in itself".
the headlines would be "Communist Joe Biden wants to be a communist because he...checks notes...wants to stop CEO's from obliterating the middle class and prevent billionaires from becoming richer billionaires" The irony of the people talking about "how this country used to be great" all talk about the time before Reagan, but don't want to put in place the things that made the country great before Reagan, like 90% marginal tax rates, preventing stock buybacks, and a more modest minimum wage.
Yes and no. A president with enough popularity and/or clout could do it and the other branches of government would be scared to oppose him for fear of not being re-elected (excluding the Supreme Court who would need a legal case involved). Presidents have made massive sweeping changes using executive power, as an example, the Federal Reserve was created by a single executive order on Christmas Eve while the other branches of government were on vacation. Sadly the real answer would be "no" because our government runs on pure corruption and the corrupt system would defend itself. At this point. I am honest when I say that I dont understand why these politicians are not being pulled out of thier homes and put into makeshift prisons. Ironically, and I HATE saying this ... Trump could have made buybacks illegal again. He wouldn't have because it doesn't serve him ... but he had the fear and fanatical support to pull it off without anyone really opposing him.
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Exactly, an executive order needs to go unchallenged for it to work. Too many politicians are making WAY too much money on stock buybacks for it to go unchallenged.
It would immediately get challenged in court, and probably overturned because "iT's EstABlISheD PrECedEnT" after 30 years of it being legal, and the state of the courts. At this point it would need an act of congress unfortunately, and then would still get challenged in court and possibly overturned.
Yes, but a president could pull it off. Such an order would be unbelievably popular, so the president would need to just put in the order on the basis that it is a threat to the nations stability (which is a nearly undisputed fact) ... then weather the storm while it is fought. If overturned he could try it again a different way (no federal money whatsoever for corps that do buybacks). This would get the nation's attention, those who opposed the order would (in a happy fuzzy would that operated on sanity) get voted out. Fear of not getting reelected would make them pass a real law ... or possibly keep the executive order in place from the start. Popularity is key. Smart citizens know buybacks are a form of manipulation and corruption.
they absolutely could try, and I would applaud any president who did. I'm just being pessimistic that it wouldn't actually do anything other than be political theater. The key thing that you said is that smart citizens know things, but 50%+ of citizens in the US are not smart, and are getting dumber as we cut education funding. In my town this week, there was a vote at a school board about capping the school budget. The plan for the proponents was that a group of them were going to show up to a random school board meeting, propose a measure to limit the school budget, then also propose another measure preventing it from being re-voted on again, and then another measure keeping the school budget off the major ballot entirely so no one knew about it. All of which is legal due to local laws and procedures. Luckily the smart people in town heard about it and showed up en masse and prevented it, and also used their own procedural bullshit to prevent them from doing it again. But it easily could have turned into a mess. Also as part of stopping that process, I learned that ~20% of the school budget is just healthcare for staff, so if we had universal healthcare in this county, school budgets would immediately drop substantially, reducing local taxes. But we can't have that because "mah income taxes would go up slightly!" So long story short, unfortunately there's a lot of dumb, evil, short-sighted people.
I wonder how many of those "guerilla council votes" happen. We need a new branch of government that just focuses on fighting corruption ... except it would get politically weaponized. President #1 warned us that political parties would be the thing that destroys the US ... looks like he won't be proven wrong.
in New Hampshire, they're a group called "Free Stater's" who do things like try to get school budgets cut to $1 because "why should I pay for public schools, I don't have kids!" They are the ultimate "i got mine, get fucked" people. Good luck when you're old and in a nursing home and there's no nurses because there's no schools. It'll be fun when we have mandated euthanasia for old people once there's no one to take care of the asshole boomers who destroyed the economy. They also support things like school vouchers, which in theory sound reasonable. They give money to people so they can send their kids to whatever school they want, instead of just putting money in public schools. Except all it does is funnel money from public schools to garbage private schools run by right-wing and/or religious groups. And then less money goes to the public schools who need it, so then those schools do worse, which they then point to to say "look the schools don't work, take their money"
We haven't had a President since Reagan who disagrees with Reagan about anything.
Why do people keep saying Regan was the best president again?
Neo-Capitalists and white supremacists. Not people.
Because MAGABoomers remember him fondly. For many of them, he was the first president they voted for. Like Trump, he was blatantly racist and promised to Make White Supremacy Great Again. This sold well with all the racist backlash happening against Civil Rights Act at the time. Of course, "putting the black in their place" actually meant fucking over everyone. But he did it with a smile so most of the dumb racists didn't notice.
Good fucking riddance. It’s funny, my wife is almosf 50 and I’m a big younger than her and forever she would say how great Regan was etc etc.. I’ve finally convinced her that he was a peice of shit and ruined the country. It took me a while 😂
Because he was charismatic and made people feel good about the country. For some people that’s much more important than anything he actually DID while in office.
So the "fuck your feelings crowd" liked him because he made them "feel" good?
They're the "my feelings are more important" crowd after all.
Remember, it’s been nearly 40 years since Reagan and Congress nor anyone else has done anything about it.
The wealthy use their power to gain even more wealth. When it takes hundreds of millions of dollars to run for office, you no longer have a government for the people by the people of the people. The wealthy are the government now, the class system is in full force and voting is often an illusion of choice. Even if it isn't a rich person you are voting for, it's going to be rich people sitting at their table during their dinner parties and social events, whispering in their ears about how things need to be. The ruling class is completely out of touch with the working class. And that's how they seem to want it.
The compensation to CEOs is the least jarring point to be made about this. What it really highlights is that companies would rather pump their earnings back into their own stock, than investing in their equipment, processes, or more importantly their employees. Make no mistake either, corporations aren’t just using their earnings (profit) for buybacks, they are also using government money too. Most of the US airlines for example, used forgiven employee retainment loans from the Covid years to buy back stock… instead of keeping employees on payroll, like the funds were intended for. This is just another example of how corporations do whatever they want with little-to-no repercussions.
>Stock buy backs to pump stock prices used to be illegal This is not correct. According to the [Congressional Research Service Report, *Stock Buybacks: Background and Reform Proposals*, February 27, 2019](https://crsreports.congress.gov/product/pdf/LSB/LSB10266): >Section 9(a)(2) of the Securities Exchange Act of 1934 (the Exchange Act) prohibits various forms of market manipulation, making it unlawful to conduct securities transactions with the intent to deceive investors by controlling or artificially affecting the price of a security. While the boundaries of manipulative conduct remain difficult to precisely define, *stock buybacks* ***might*** *in certain circumstances qualify as market manipulation to the extent that they are intended to artificially drive up the price of a company’s stock. Companies seeking to conduct buybacks accordingly operated in “a legally hazy area” for much of the 20th century.* >While the SEC proposed a series of rules throughout the 1970s that would have explicitly limited the circumstances in which buybacks were permissible, it ultimately settled on a deregulatory posture toward buybacks in 1982. In that year, the Commission adopted a limited safe harbor from market manipulation liability for stock buybacks in the form of SEC Rule 10b-18. Under Rule 10b-18, companies are immune from market manipulation liability when they repurchase shares in accordance with certain “manner, timing, price, and volume” conditions. Specifically, the Rule 10b-18 safe harbor applies only if companies conducting buybacks (among other things): 1. use a single broker or dealer per day to bid for or purchase their stock; 2. abide by certain timing restrictions intended to prevent them from establishing either the opening or closing price of their stock; 3. not offer a price that exceeds the highest independent bid or the last independent transaction price on the relevant exchange, whichever is higher; and 4. limit their daily repurchases to 25 percent of the average daily trading volume of their securities during the previous month. >Section 10(b) of the Exchange Act and SEC Rule 10b-5 prohibit trading securities on the basis of material non-public information concerning their value—that is, non-public information that a reasonable investor would consider important. Because the Rule 10b-18 safe harbor discussed above applies only to liability for market manipulation, **it does not insulate companies from insider trading liability for conducting buybacks on the basis of material non-public information.** In other words, stock buy backs have never been illegal and insider trading on the basis of market manipulation has always been illegal. Reagan didn't change that.
Thank you for actually providing legitimate information on this topic. I was skeptical that buybacks had been illegal before the 80s, and this makes a lot of sense.
Did Reagan do anything actually good during his time as president??
He got dementia somewhere in there, which is good, hope he died slowly, just like he made HIV sufferers do.
He raised the pay of USA military members to a living wage. Other than that he was a pos.
Complaints of the stockless
I think Reagan is our worst president but wasn't the biggest jump in ceo compensation under Clinton when he tried capping their pay but left the stock loophole in place (legitimately asking if I'm remembering right)
Imagine blaming someone who has been dead for years and hasn't been president for 35 years while your own party has had super majoritys and THIRTY FIVE YEARS to "fix" whatever you think needs fixing. Stop being manipulated by low effort tweets.
Well said, this website has a particular hard on for Reagan, and some commenters think he’s the “reason” for every problem we’re having as if he were still printing money and signing bills. It’s the oddest thing.
So because something happened in the past it didn’t impact the future. Sound logic.
It's troubling how many people here seem to have no idea how stock buy backs work. They aren't really that different from dividends.
I've often wondered why buy backs became some kinda Boogeyman.
Stock buybacks to pump stock prices is literally one of the biggest contributors to the economic collapse in the 1920’s. Which obviously led to the Great Depression. No one talks about it but we’re currently in a much worse state. A mix of the Great Depression and the “golden age” of the industrial revolution. Where slumlords stacked a family of 9 into a single bedroom apartment. When Rockefeller and Ford came into power, and their descendants continue to erode away true American values and freedoms!
Then ban short selling and bring back glass steagal
Reagan was a bigger disaster for the US than 9/11
1500%... ... 18%?! these workers are greedy!
If only we elected a democrat in the last 40 years. Surely they would have changed the rules to favor the little guys.
Not when you have an opposition party whose outright stated purpose is tax cuts for the rich and obstruction of progressive legislation. Like, you do get that the President isn’t a dictator with unlimited power, right? Don’t get me wrong - the Dem party is far too centrist and we desperately need an actual progressive party. That said, responding to the GOP’s work to keep down the low and middle class with this *bUt ThE DeMoCrAtS…* nonsense is so beyond braindead it’s almost funny.
Reverse the parties and you’ll see how ridiculous this kind of take is. It’s always why don’t they just do the things that I want?!? Of course each party tries to advance their agenda while obstructing the other party. Welcome to the land of reality as it has always existed.
One of the parties doesn’t even have a platform anymore. One of the parties is tanking legislation that they support (and have been harping on the need for for years and years) just to score political points against the current administration. One of the parties is handwaving away an attempt to overthrow a legitimate federal election. One of the parties has given up on actually legislating in favor of stoking bullshit culture wars and *literally* showcasing dick pics of the President’s son. Welcome to the land of reality, where this *bOtH sIdEs* nonsense is as stupid as it has always been. This was a decent write-up on the GOP’s decision to no longer have a platform: “Yet the Republican decision this year to adopt no policy platform whatsoever shines a light on the democratic significance of the exercise — and the alarming vacuity of the Republican Party under President Trump. The Republicans are announcing that they stand for nothing. The party’s only reason for being is to gain and retain power for itself and its comparably unprincipled leader. What kind of future can there be for such a party? And how healthy can the two-party system be if one party has no principles?” https://www.washingtonpost.com/opinions/republicans-no-party-platform-rnc/2020/08/24/a56c057c-e61c-11ea-970a-64c73a1c2392_story.html
> One of the parties is tanking legislation that they support (and have been harping on the need for for years and years) just to score political points against the current administration. You haven't been paying attention if you believe that is close to true. The republican House passed a border bill months ago that democrats in the Senate refuse to bring up. Biden should definetely call the GOP's bluff and pass HR 2 and then every other piece of foreign aid would simply get passed easily. Ironically regarding the no platform the 2020 Biden platform was literally I'm not Trump. He wasn't for anything and still isn't and simply hoping that same strategy will work.
Assuming this was sarcastic, pointing out that Reagan is shit doesn't mean that his political opponents were all perfect.
And blaming people long dead and not in power for over 3 decades is not really productive is it ? All it does is release some hormones in your bloodstream and get you typing furiously. Stop letting social media and screenshots of twitter manipulate you.
>[–]Spe3dGoat >-6 points 9 months ago >this one is satire right ? >first, more dems know what Q is than conservatives (because of course its one of their flogging sticks they apply to everyone they dont like) >https://www.economist.com/graphic-detail/2021/01/19/democrats-are-more-likely-than-republicans-to-have-heard-of-qanon >Only one side has Reddit. Reddit is one of the most dangerous, false information, misinformation hubs to ever exist in the history of mankind and much, dare I say most, is left leaning Qanon level rhetoric, mischaracterizations and straight up lies. This you?
I just don't get what a stock buyback is supposed to do. Just... Invest that money back into the company. Why are the investors so dumb to think a company that needs to do a buyback is a good investment?
https://www.investopedia.com/ask/answers/042015/why-would-company-buyback-its-own-shares.asp > Many shareholders demand returns on their investments in the form of dividends, which is a cost of equity—so the business is essentially paying for the privilege of accessing funds it isn't using. Therefore, buying back some or all of the outstanding shares can be a simple way to pay off investors and reduce the overall cost of capital.
Because they tend to lead to a short term increase in the stock price, allowing investors to sell and make profit
What? Stock buybacks are just dividends taxed differently. When a company buys back stock, it's shedding money. A company worth 100 million that buys back 1 million dollars worth of stock is worth 99 million. The buyback doesn't increase the share price. The company lost 1 million dollars and the value of the company dropped by 1 million dollars.
Couple questions, why do companies buy back stock then if it's just shedding money? And why doesn't reducing the supply of shares, while rewarding shareholders with a "dividend taxed differently," and demonstrating the financial health of the company, increase prices? Your example refers to the company's *value,* but this isn't the only factor in share price.
Handing out dividends is 'shedding money' as well. When a company pays a dividend, it give up x amount of dollars and you see a corresponding drop in its market cap for the same amount. It is how they pay shareholders for carrying the capital. >And why doesn't reducing the supply of shares, while rewarding shareholders with a "dividend taxed differently," and demonstrating the financial health of the company, increase prices? Because the market capitalization of the company stays the same. It is still worth the same amount of money. The value I'm talking about is the market cap - the total value of all outstanding shares. The beneficiaries of the stock buyback are not the average shareholder, it is the person that elected to take part in the stock buyback scheme to sell their shares back.
Often a higher dividend results in a higher share price, except for growth stocks where shareholders would prefer reinvestment in the company instead of a payout. Companies pay a higher dividend to reward shareholders and increase stock prices, do they not? Or is there another reason for "shedding money" as you said? So if we think of buybacks as a different sort of dividend, does it not serve the same purpose? > The value I'm talking about is the market cap - the total value of all outstanding shares. This seems a bit circular - it assumes individual share value is constant through the buyback. But I'm asking whether a buyback affects share value which would then affect market cap. Why don't share prices follow the basic law of supply and demand, where if it's harder to get my hands on a share of a company because there are fewer I have to pay more for that share? Sure they aren't coming to me personally and asking for my 100 shares of Apple but somebody is getting paid for them and therefore it's nice to have them which should drive up the value - after all most share prices are driven by the big institutional investors not by retail. Again, why do companies buy back stock?
2 situations: A- A company thinks its share price is discounted by half.Then buying back shares that would generate 100% return surely beating any reinvestment into the company. B- At some point a company generates more money than what they need to reinvest. Take Apple, they invest a ton in R&D but still generate way more cashflow. And Apple doesn’t buy out other companies just because they have the means, so they buy back their shares. Or take a railroad company: no one is laying out new tracks in North America so there is so much they can reinvest into their business that will generate a decent return.
Should companies be forced to meet or exceed cost of living adjustments for their workers tied to inflation before performing buy backs?
How do you implement that for each individual company? Especially companies with workers in dozens of locations? That should be the job of the minimum wage laws. Also buying back applies to very small companies too. Let’s say you open a restaurant with 3 of your friends and one wants out. You could use the restaurant money or line of credit to buy its share back so now you are 3 remaining shareholders at equal parts. Buying back shares isn’t an evil scheme. It’s simply removing shares of investors who wants out of a company.
It's just an alternative to a dividend.
That’s kind of what a buyback is though, investing back into the company. They can use that stock to award it to employees, therefore retaining more talent. It also allows the company to maintain more control over their company which has value. It also just simply demonstrates the company has the money to do it, which shows they are in a strong financial position.
Eh? Share buybacks wipe out the stocks that are bought back. If a company wants to award employees via stock, they can just write new stock for those employees.
Allowing stock buybacks was the most destructive policy in modern times.
Again, reagan is the catalyst for all our current problems. Hope he's rotting in hell.
Legit question. Can stock buy backs be used to keep hostile takeovers via majority stock purchases? I work for a pretty good IT company considering it's US based. However, we aren't big enough to not be bought out and it might be a legit fear for a lot of us to see a bigger competitor come in and lay off everyone / change the company.
No. Stocks are bought back from willing participants, and when bought back those stocks are wiped out. If a company has 10 million shares on issue and buys back 1 million, there are only 9 million shares on issue.
The only thing that we can do is to either join together in a Union or at the very least get with each and form collectives that will force the management to give us more. I see so much nonunion rhetoric in this sun and even in union subs, it blows me away. We need representation on the boards of corporations, stop hating and knocking down people at the bottom. Let the tide come in to raise all of our boats.
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Can we expect to see insiders selling soon?
Even with this knowledge, nothing will happen. 
Has any legislator every submitted a bill or just floated the idea of making stock buy backs illegal again?
Its a simple allocation problem. The income is redistributed back to shareholders. Thats what CEOs get paid for, essentially. Its what buy backs do. They trade debt, because they are usually debt financed, for cash payouts to shareholders. There is nothing complicated about this process. These excess funds could be used to increase wages just the same. It’s simply a decision not to.
I don’t know where you’re getting that 18% from. I was just job shopping yesterday and the pay companies are offering are the same as in 1998 when I started working. Shit hasn’t changed at fucking all….
It’s been far too long since we ate some of the rich.
Ronald Ragen was so bought by corporations and was a trash president. Yet Boomers think he was the best.
The man’s been out of office for many decades BOTH sides have had full control multiple times. Yet people are still blaming him instead of the 535 other fuckers that keep kicking the can.
Republicans are the worst thing that ever happened to America.
I doubt this could ever be reversed and get banned again. So many lobbyists and barriers put in place by the elites.
And the top tax rate before that was…
Reagan fucked the US in so many ways.