According to Republicans, after reducing the corporate tax rate from 35 percent to 20 percent, Corporate America wouldl use this money to stimulate the economy by reinvesting it into their businesses creating new jobs and raising wages.
The problem is, it didn't happen after the Reagan tax cuts, nor the Bush tax cuts. What most corporations did was pay CEO's more, bought up more stock and passed the money on to stockholders. In fact, an August 30 New York Times analysis found that 92 companies from 2008-2015 paid below the 20 percent figure touted by the Republican plan. And, of those 92 companies, 48 eliminated 483,000 jobs.
The non-partisan Research Services has determined that there is no direct correlation between tax cuts to the rich and job creation.
On Nov. 14, Gary Cohn, chief economic advisor to President Trump, attended a Wall Street Journal CEO council meeting. The moderator, John Bussey asked the audience, "If the tax reform bill goes through, do you plan to increase investments in your company?" He asked for a show of hands. Very few CEO's raised their hands and Cohn was shocked.
History has shown that the Republican myth of "trickle down" economics is nothing more than voodoo or horse manure economics. Rather than trickling down to the low and middle income American families, it trickles upward to the wealthy and Corporate America.