Paul Ryan tried to claim corporations would create jobs and investment with their tax cuts. NBC's Savannah Guthrie reminded him that CEOs are saying otherwise.
In a matter of hours, Republicans’ tax scam is all but certain to sail through its final vote in the GOP-controlled House, and head to Donald Trump’s desk.
And it is already clear that no one is buying House Speaker Paul Ryan’s breathless claims about how much it will grow the economy.
Appearing on the “Today” show Wednesday morning, Ryan was challenged by reporter Savannah Guthrie, who reminded him that even the business leaders themselves are saying they will not create jobs with their free money:
GUTHRIE: Again, the biggest tax rate cut is for corporations, and the problem is, there’s — a lot of CEOs have said, really candidly, I’m looking at a list of CEOs who’ve said, we don’t plan to reinvest. What they’re planning to do is to do stock buybacks to line the pockets of shareholders. Let me quote Michael Bloomberg, a billionaire, hardly an enemy of business. He said, “CEOs aren’t waiting on a tax cut to ‘jump-start the economy,’ a favorite phrase of politicians who have never run a company, or to hand out raises. It’s pure fantasy to think that the tax bill will lead to significantly higher wages and growth.” I’ll ask you plainly: are you living in a fantasy world?
RYAN: I would compare that anecdote to just the surveys of businesses, like the National Association of Manufacturers surveys, which show the vast majority of businesses are going to do just what we say. Reinvest in their workers, reinvest in their factories, pay people more money, higher wages.
In fact, while Ryan is right that manufacturers claim they will reinvest tax cuts in trade group surveys, there is no evidence companies are making actual plans to do so.
The only impact of the tax bill so far has been to increase Wall Street trading, a clear sign companies anticipate they will be giving the extra profits to shareholders. Many executives, like the CEO of Wells Fargo, are quite open about this. Historically, studies show corporate tax cuts have almost never go to employees or to hiring. There is no reason to believe this one will either.
Guthrie did not stop pressing Ryan. She reminded him that the Wall Street Journal Council of CEOs just held a meeting about the tax bill, and almost none of the CEOs pledged to reinvest.
“The fact of the matter is that corporations are already sitting on a ton of cash,” said Guthrie. “They have record profits. $2.3 trillion. Why aren’t they raising wages and creating jobs now?”
“Guess what? About $3 trillion of that cash is trapped overseas and cannot come back into our economy to be reinvested,” replied Ryan, failing to note that the proposed solution to this in his tax bill — cutting taxes for overseas profits — was already tried in 2004, and actually led to fewer jobs and more profits parked overseas.
Ultimately, Ryan had no real response to Guthrie except to repeat the same false GOP canards and empty promises that have already failed. He all but confirmed that he is, in fact, living in a fantasy world.