CWA to CEOs: If you get a tax cut, we want raises

The Communications Workers of America (CWA) told CEOs of corporations where its members work that if the Republican corporate tax cut bill passes, the union wants its members to get the big raises that President Trump and House Speaker Paul Ryan say will result from the cuts.

“In light of recent developments on the national level concerning taxes, wages, and jobs, I write to seek your agreement that our members in CWA-represented bargaining units will receive an additional $4000 each year if the statutory federal corporate tax rate is lowered to 20 percent,” wrote CWA President Chris Shelton in a letter to eight major corporations that have collective bargaining agreements with CWA.

President Trump and Speaker Ryan have been marketing their proposed Tax Cut and Jobs Act as a working class tax cut rather than a windfall to corporations and the wealthy.

To make this point, they rely on an analysis by the President’s Council of Economic Advisers (CEA) that asserts that the economic growth generated by the corporate tax cuts will result in higher wages of between $4000 a year and $9000 a year for workers.

Shelton as well as most professional economists are skeptical about the analysis, but should the tax bill become law, Shelton wants guarantees that workers will receive the promised raises.

And he wants the guarantee in writing.

The letter includes a memorandum of understanding that Shelton asked the CEOs to sign. It states that should the corporate tax be lowered to 20 percent, “each employee in the bargaining unit will receive an additional $4000 in each year of such rate.”

The memorandum would also guarantee that the pay raises won’t be offset by benefit cuts and commits the company to forego the offshoring of jobs.

The letter seeking the memorandum was sent to the CEOs of Verizon, AT&T, NBC Universal, Frontier, General Electric, ABC Entertainment, CenturyLink, and American Airlines.

The US House of Representatives passed its version of the new tax bill before the Thanksgiving Day holidays and the Senate is expected to vote on the bill after the holidays.

Shelton is not the only one skeptical about the Presidents claim that the economic growth generated by the tax cut will lead to big pay raises for workers.

“The Trump administration’s claims that large wage gains for workers will result from cutting corporations’ taxes is not supported by the professional research consensus on this issue, and have no serious backing in the data,” said Josh Bivens, director of the Economic Policy Institute.

These words were echoed in a New York Times editorial which calls the claims about economic growth generated by the corporate tax cuts, “the biggest whopper” of all the “lies Republican lawmakers and President Trump tell about their tax bills.”

According to the Times, “just one of 38 prominent economists surveyed by the University of Chicago agreed that the Republican tax cut would substantially lift the economy.”

Shelton sees the Republican tax bill as a corporate giveaway that does little if anything to help the working class.

In addition to reducing the corporate tax rate from 35 percent to 20 percent, the Republican bill also lowers profits from overseas operations to 0 percent with some exceptions.

“Obviously, such a rate structure incentivizes companies to shift work overseas, killing US jobs,” writes Shelton in his letter to the CEOs.

There are other problems with the tax bill that will hurt workers.

Union workers with good paying jobs could see their taxes increase because the Republican bill eliminates the deduction for state and local taxes, and it includes new taxes on benefits that union workers have fought hard to win.

Cutting corporate taxes also will lead to increased deficits to the federal budget that will result in cuts to Medicare and Medicaid.

For these reasons, CWA has been urging its members to contact members of Congress to tell them to vote no on the tax bill.

CWA supports real tax reform that will reduce taxes on the working class, said Shelton in a union hall teleconference for members. But the Republican tax bill is nothing more than a giveaway to the 1 percent.


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