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Keith Townsend: Our representatives care more about helping the wealthy than helping hurricane victims

By Keith Townsend

Special to the Salisbury Post

After being informed that at least 4,600 Americans may have died in Puerto Rico in the wake of Hurricane Maria, it might be of interest to know that both of our congressional representatives, Ted Budd and Richard Hudson, joined 67 of their fellow Republican colleagues in voting against the initial aid package to the island.

Last fall, when I first became aware that my congressman, Ted Budd, had taken this position, I called his office to ask why. The person I spoke with told me there was already a federal flood relief program in place with which any further aid would overlap.

He also informed me that Representative Budd had already voted for aid to Texas to assist in recovery from Hurricane Harvey. I was certainly glad to hear that Representative Budd had reached out to help the people of Houston, but apparently there were no further resources available for the citizens of Puerto Rico. Fortunately, in spite of Ted Budd’s and Richard Hudson’s objections, Congress did eventually pass a $36.5 billion disaster relief bill for Puerto Rico.

It seems, at the time, both of our local congressmen were much more interested in promoting President Trump’s $1.5 trillion tax cut. Of course this tax cut, like all others that came before it, was sold as a boost to the middle class economy and a gift to American workers. In fact, President Trump described his new tax law as a Christmas present to all of us.

Economist Robert Reich reported as early as February of this year, only a few weeks after the tax cut was enacted, that American corporations had already used $86.6 billion of this new money to purchase stock buybacks. In contrast, during this same period, corporations paid out a comparatively paltry $2.5 billion as one time bonuses for workers. This indicates that the corporate coffers received approximately 35 times more money than workers saw in their paychecks.

Stock buybacks are corporate purchases of the corporation’s own shares of stock. A corporation does this to artificially prop up the company’s share prices.

As Reich points out, “Money spent on buybacks isn’t reinvested in new equipment, research, or factories. Buybacks don’t add jobs or raise wages. They don’t increase productivity. They don’t grow the American economy.”

Buybacks used to be illegal and were considered an unlawful manipulation of stock prices under the Securities Acts of 1933 and 1934. The SEC legalized buybacks in the 1980s under President Reagan.

In fact, according to the Academic-Industry Research Network, 94 percent of corporate profits in the last decade have been devoted to buybacks and dividends.

As voters, we should remember that while Congressman Budd and Congressman Hudson decided that disaster relief aid to Puerto Rico was an expense our nation could not afford, they apparently had no qualms about releasing hundreds of billions of dollars to the wealthiest Americans.

Keith Townsend lives in Mount Ulla.

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