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How Tax Reform Is Keeping Promise ‘Fight for $15’ Couldn’t


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Yes, Tax Cuts Really Are The Reason for Your Raise

4 HOURS AGO Nathan Keeble

Since Trump’s reduction of the corporate tax to 21%, workers across the country have been rejoicing. Companies like Wal-Mart, Apple, Bank of America, and many more have announced firm wide bonuses and minimum wage raises. To most, the tax cuts appear to be a clear success. However, some commentators, such as Dr. Veronique de Rugy at Reason, are saying not so fast.

Dr. de Rugy claims that these announcements are not in line with economic theory. For wages to be affected by tax cuts takes an extended period of time. The newly freed revenue must be accumulated and invested into new capital equipment which boosts worker productivity and, consequently, their wages. Quite simply, Dr. de Rugy suggests that the tax cuts simply have not been in place long enough to be held directly responsible for these announcements, and she even ponders if they are nothing more than PR moves.

In truth, these bonuses and raises are perfectly in line with what economic theory predicts.  :snip:  https://mises.org/wire/yes-tax-cuts-really-are-reason-your-raise

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Maryland manufacturer visited by Paul Ryan announces tax cut bonuses

Joseph Lawler

 March 28, 2018

A Maryland manufacturer will pay $1,000 bonuses to full-time employees as a result of the Republican tax cuts, a move cited by House Speaker Paul Ryan’s press office Wednesday as an example of the tax law working.

Dixon Valve, a company in Chestertown that makes hose fittings and accessories, said the bonuses were a “direct result” of the tax overhaul and regulatory relief.

“While the new tax law is far from perfect, it is a great start in helping companies like Dixon reinvest in the future,” CEO R.L. Goodall wrote in a letter to employees.

 

(Snip)

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