This weekend, the Democratic Party Platform Committee will put the finishing touches on the party’s official policy positions.
What’s not in there, yet? A clear stand against corporate stock buybacks.
But while the presidential candidates were talking about the issue, corporations spent $600 billion buying back their own stock. (And that’s just counting what the big corporations spent.)
If that money had been spent on new hires, rather than just on concentrating corporate ownership, it could have created almost 8.5 million jobs. (That’s at the average US wage, including benefits.)
Imagine what the US economy could look like, if 8.5 million more of us were working right now. Instead… well, you can read “US companies have spent $2 trillion doing something that has absolutely no impact on their business” for yourself here. (That’s what the past five years of buyback spending adds up to: $2 trillion. Yes, “trillion” with a “T.”)
Buyback spending drives up stock prices, which enriches corporate executives and investors who sell their stock. But it’s not an investment in the corporation’s future – just the opposite, in many cases. A lot of recent buybacks have been financed by new corporate debt, in a practice that one Wall Street insider described to me as “monetization of future revenues.” They’re borrowing against future corporate revenues to pay stockholders now. They’re mortgaging the future, rather than investing toward it.
This used to be illegal, back when the economy worked for the middle class. This weekend, the Democratic Party Platform Committee should take a clear stand: it ought to be illegal, now.
Read more NH Labor News coverage about stock buybacks here.