How tax cuts translate to pay rises for allMay 19, 2019
As I have written in the past, President Trump’s tax cuts were not a stimulus program. Tax cuts are only permanent until someone comes along to muck them up.
So last week — about a year and a half since the Tax Cuts and Jobs Act of 2017 — Bank of America raised its minimum wage to $17, effective as of May 1, 2019, so this week’s paychecks are going to be a little fatter for all those bank employees at minimum-wage level.
And the bank said it will continue to raise the wage — to $20 by 2021. Workers can thank the corporate tax cuts in particular.
Minimum wage is a hard thing to debate. While I always want everyone to make more, the reality is that some businesses can afford to pay more than others.
Small businesses are generally more likely to reduce hiring or even lay people off when the minimum wage rises too fast.
It’s not because they are greedy. Many cannot afford it, and government-mandated wage hikes — as the liberal left demands — would create more unemployment and slack in the labor market, hence lower overall wage growth.
When corporate taxes were cut, it resulted in a bonanza in which literally millions of people received $1,000 bonuses — many also received other benefits, like increased 401(k) matches and reduced employee contributions toward company provided health care plans.
Kudos to BofA for having the brains and profits to reinvest in its people, thereby improving its customers’ experiences as well.
JPMorgan also has been very generous to its employees, especially from the lower rung up to $65,000 earners, with bonuses, raises and benefit bumps, too.
Ignore how some ignorant economists say about the rich getting richer. Tax cuts are a pay raise for all, especially the minimum wage earners and entry-level employees.
If you doubt me, just ask them how welcome their $1,000 bonus check was to their bank accounts or, in the case of BofA workers, how sweet their bump-up in wages was this week.
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