Cynical Scribes Continue to Downplay Tax Cut-Driven Good News

January 16th, 2018 12:56 PM

Reporters continue to concoct reasons to complain as more than two million American individuals and their families have suddenly become better off than they were three weeks ago. Even the news that the nation's largest retailer is raising its nationwide minimum wage while paying bonuses of up to $1,000 to every employee, and that an automaker is investing $1 billion in U.S. production, haven't moved cynics who refuse to concede the unconditional positivity in all of this.

The Associated Press's breaking news briefs announcing Walmart's moves last week deliberately ignored the tax law's role:




It wasn't difficult to find other attempts to poke holes in Walmart's announcement in other establishment press coverage.

Sarah Halzack at Bloomberg News, posing as an expert business manager, thought that Walmart should have done what it did even without the tax-cut bill's passage:

Walmart's Wage Hike Is Smart Even Without Tax Cuts

Wal-Mart Stores Inc. is using the windfall the GOP just gave Corporate America to score a public-relations coup, with a strategic move that would have been smart even without a tax cut.

Adam K. Raymond at New York Magazine was particularly harsh, and took an inadvertent casualty:

... (The announcement is) an indication that the lowest earners in the country are finally starting to see some benefit from the almost decade-long economic recovery.

Well, that's because that so-called recovery's first seven and a half years under President Barack Obama were the worst on record since World War II.


... WalMart CEO Doug McMillon credited the recently passed tax bill for allowing the company to make the changes. “Tax reform gives us the opportunity to be more competitive globally and to accelerate plans for the U.S.,” he said in a statement.

It’s unclear how much of that is spin.

... By tying the raises to the tax bill, Walmart is looking for a PR win.

Gosh, the rest of us naively thought the company was rewarding its employees and trying to retain them in a strong economy.

At USA Today, Nathan Bomey's supposedly straight-news piece on Walmart's moves also got cynical:

Economists have argued that one-time bonuses, while significant for workers living paycheck-to-paycheck, are not as meaningful as permanent wage increases. Critics of tax reform have said companies are dishing out bonuses for the sake of good publicity and to curry favor with the White House.

Walmart's press release also asserted that the tax law makes it "more competitive globally" and will lead it "to accelerate plans for the U.S." That would appear to foreshadow stronger economic growth, the primary motivation behind the Trump-GOP effort. Don't expect the press to make that connection.

Speaking of being more competitive, Walmart unfortunately felt the need to close 63 underperforming Sam's Club stores last week.

CNN Money declared that this was "a PR mess on Walmart's big day." But why? Closing laggards is necessary to protect the rest of the business.

CNN waited 16 paragraphs to note the following:

... affected employees will receive the (Walmart-wide) bonuses, as well as 60 days of pay and severance if eligible.

Walmart could have used the cost of the closures of about $415 million (14 cents per share times just under 3 billion outstanding shares) to justify not paying the bonuses and raising hourly pay — but didn't.

Two Detroit-area journalists weren't even genuinely impressed with the $1 billion investment in U.S. manufacturing Chrysler has announced it will make, along with paying $2,000 bonuses to all employees. An auto industry analyst quoted at the Detroit Free Press thought it was political posturing:

With all the uncertainty surrounding NAFTA, it just makes sense to do this and eliminate the potential negative impact, said Kristin Dziczek, director of the industry, labor and economics group at Ann Arbor's Center for Automotive Research.

Sure, Kristin, Chrysler just committed to a $1 billion commitment solely to lobby for continuing an agreement that even auto execs acknowledge "needs a redesign."

Lee DeVito's Friday headline at the Detroit Metro Press was more sarcastically blunt: "Fiat-Chrysler throws Trump a bone."

Journalists, the vast majority of whom have have never run a business or met a payroll, continue to downplay the significance of the unprecedented, marvelous things we have seen since just before Christmas.  It's more than a little tiresome. Why can't they just be happy for the recipients of unexpected bonuses, pay increases, new benefits, and even utility-rate decreases?

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