Some CEOs wasted little time in promoting President Trump’s tax-cut bill as a win-win-win for their workers as well as for their companies – and the country as a whole.
Conscious that tax-cut opponents have latched on to the fact that one of the bill’s biggest provisions is to cut the U.S. corporate tax rate to 21 percent from 35 percent, AT&T, Wells Fargo, Comcast, Boeing and Fifth Third Bancorp. quickly announced on Wednesday that they would pass along some of the anticipated tax savings to their employees in forms ranging from outright bonuses to facilities and training investments.
AT&T, for instance, said it would pay a special $1,000 bonus to more than 200,000 of its non-management workers, once the tax law kicks in.
“Congress, working closely with the president, took a monumental step to bring taxes paid by U.S. businesses in line with the rest of the industrialized world,” Randall Stephenson, chairman and CEO of AT&T, said in a statement. “This tax reform will drive economic growth and create good-paying jobs.”
“This tax reform will drive economic growth and create good-paying jobs.”
AT&T at the same time confirmed it will invest $1 billion more in U.S. operations in 2018. Also germane is the fact that the U.S. Justice Department recently sued AT&T in an effort to block its proposed merger with Time-Warner, on antitrust grounds.
Trump took credit for AT&T’s plan at a press conference on Wednesday. “That’s because of what we did,” he said. “So that’s pretty good.”
Meanwhile, Comcast said it would award one-time $1,000 bonuses to more than 100,000 employees, including front-line and non-executive employees.
Scandal-plagued Wells Fargo said it would boost its minimum wage to $15 an hour, an 11-percent increase, beginning in March.
Boeing said it would move forward with $300 million in investments as a result of the new tax law, including $100 million in employee training and education and $100 million to enhance Boeing facilities as part of its “workforce of the future” initiative.
And Fifth Third Bancorp., a regional bank based in Cincinnati, said it would boost its minimum wage for all of its nearly 3,000 hourly employees to $15 as well as distribute a one-time bonus of $1,000 for more than 13,500 employees.
“We want to invest in our most important asset – our people,” said Fifth Third CEO Greg Carmichael. “Our employees drive our reputation, our business and our success.”
Within 24 hours, collectively, of their announcements, the stocks of these companies were ticking upward generally in excess of the market.
AT&T stock was up by 1.22 percent, to $39.02 on the day; Fifth Third stock was up by 1.34 percent, to $30.92 on the day; Comcast was up by 2.48 percent to $40.36; and Boeing was up by 0.36 percent, to $296.84. Meanwhile, the Dow Jones Industrial Average was up by 0.42 percent for the day, to 24,830.21.
It remains to be seen whether such actions – and other corporate gambits that may follow – will turn up the arrow quickly on American public opinion about Republicans’ tax cuts and reforms. Only 24 percent think the plan is a good idea, according to an NBC News/Wall Street Journal survey, and almost two-thirds believe it was designed to help the wealthy.