No Future

Daily Kos: As companies spend more and more of their cash on stock buybacks, it's not surprising that people who generally speaking think companies should invest in workers and the productive economy object to the practice. After all, the buybacks—sometimes paid for by laying off workers—temporarily prop up stock prices, which in turn often inflates the bonuses of the executives who decided to buy back the stock. That makes it a pretty direct way of taking from the 99 percent to give to the 1 percent. Of course Robert Reich objects; of course I do.

But the New York Times quotes a number of profit-oriented business analysts who think it's a terrible business practice:

“It’s a symptom of a deeper problem, which is a lack of investment in the long term,” said William W. George, a Harvard Business School professor and former chief executive of Medtronic, a medical technology company. “If we’re not investing in research, innovation and entrepreneurship, we’re going to be a slow-growth country for a decade.”

As a rule GOP style deregulation and tax policy not only allows such things but encourages them. Paying top executives in stock options, a practice which used to be illegal for exactly this reason is a prime example. Creating complex financial instruments such as CDO's and derivatives to to hide financial fraud is another. Repealing regulation like Glass-Steagall to allow banks to do this kind of thing on a mass scale is what crashed the economy. And of course, allowing these people to keep most all of their ill gotten gains because you've cut top marginal and capital gains tax rates only exacerbates the situation.

But aside from the obvious detrimental effects of such pro-1% stock manipulation, fiscal policy, and deregulation, the quote brings up another stark difference between Democratic and Republicans. Democrats do, and Republicans don't promote policy that encourages investment in the future, whether it be re-investing operating profit here at home or public money to basic R&D, education and infrastructure investment. The GOP would rather just pay their people, America be damned.