Harley-Davidson Move Shows Failure of Trump Tax Cuts
In February of last year, President Donald Trump met with executives and working people at Harley-Davidson, promising that his proposed changes to tax law, trade, tariffs and other policies would help the company grow and working people would be the beneficiaries. This promise was widely made by Trump and other Republican advocates of the tax bill that Trump signed in December. But, as time goes on, we see, more and more, that the law not only isn’t helping working people, it’s making things worse.
Here are some of the key things you need to know about the tax law and the effects it has on working people (using Harley-Davidson as an example):
Harley-Davidson is laying off 800 workers at a Kansas City, Missouri, factory by the fall of 2019.
The company says it expects to add 450 full-time, casual and contractor positions, to their plant in York, Pennsylvania. A net loss of 350 jobs, but considering that some of the new jobs aren’t full-time, the loss is bigger.
The company just announced a dividend increase for shareholders and a stock buyback plan where it will purchase 15 million of its shares with a current value of just under $700 million.
In the first three months after Trump signed the tax bill, corporations have spent a record $178 billion in stock buybacks.
Harley-Davidson is a profitable company, making between $800 million and $1 billion in pre-tax profits.
The company will be opening a plant in Thailand. It says that the new plant isn’t related and that it isn’t outsourcing jobs, but advocates for working people reject that argument: “Part of my job is being moved to York, but the other part is going to Bangkok,” said Richard Pence, a machinist at the Kansas City plant.
Greg Tate, a representative of United Steelworkers District 11, which represents about 30% of the plants workers, suggested that the tax bill may have freed up money to make the move: “They have the capital now to move Kansas City, to shut it down. All of that money really came from the tax cut plan, so it kind of had the opposite effect of what it was supposed to do.”
Machinists (IAM) President Robert Martinez Jr. sent a letter to Trump asking him to save the Kansas City plant: “For decades, hard-working Machinists union members have devoted their lives to making high-quality, American-made products for Harley. America’s working men and women deserve better than being thrown out onto the street. Our nation deserves better.” Trump did not budge.
Pence appeared on Chris Hayes’ show to discuss the layoffs:
Rick Pence, worker at closing Harley-Davidson plant: “When the tax cut finally rolled down to us, I got about $16, $17 more a week. But now Harley’s giving me one heck of a tax cut because I won’t have no income at all next year and my tax will be zero.” #inners pic.twitter.com/MaYaahVxyN
— All In w/Chris Hayes (@allinwithchris) May 23, 2018
Wed, 05/30/2018 – 08:44