[Congressional Record Volume 167, Number 157 (Monday, September 13, 2021)]
[Senate]
[Pages S6451-S6452]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
CLOTURE MOTION
The PRESIDING OFFICER. Pursuant to rule XXII, the Chair lays before
the Senate the pending cloture motion, which the clerk will state.
The legislative clerk read as follows:
Cloture Motion
We, the undersigned Senators, in accordance with the
provisions of rule XXII of the Standing Rules of the Senate,
do hereby move to bring to a close debate on the nomination
of Executive Calendar No. 64, James Richard Kvaal, of
Massachusetts, to be Under Secretary of Education.
Charles E. Schumer, Patty Murray, Jack Reed, Jeanne
Shaheen, Patrick J. Leahy, Martin Heinrich, Catherine
Cortez Masto, Kirsten E. Gillibrand, Christopher
Murphy, Tammy Duckworth, Christopher A. Coons, Tammy
Baldwin, Chris Van Hollen, Tim Kaine, Thomas R. Carper,
Amy Klobuchar, Margaret Wood Hassan, Alex Padilla.
The PRESIDING OFFICER. By unanimous consent, the mandatory quorum
call has been waived.
The question is, Is it the sense of the Senate that debate on the
nomination of James Richard Kvaal, of Massachusetts, to be Under
Secretary of Education, shall be brought to a close?
The yeas and nays are mandatory under the rules.
The clerk will call the roll.
The legislative clerk called the roll.
Mr. DURBIN. I announce that the Senator from New Jersey (Mr. Booker),
the Senator from Nevada (Ms. Cortez Masto), the Senator from California
(Mr. Padilla), and the Senator from Hawaii (Mr. Schatz) are necessarily
absent.
Mr. THUNE. The following Senators are necessarily absent: the Senator
from Indiana (Mr. Braun), the Senator from Texas (Mr. Cornyn), the
Senator from Alaska (Ms. Murkowski), and the Senator from South Dakota
(Mr. Rounds).
The yeas and nays resulted--yeas 55, nays 37, as follows:
[Rollcall Vote No. 359 Leg.]
YEAS--55
Baldwin
Bennet
Blumenthal
Blunt
Brown
Burr
Cantwell
Capito
Cardin
Carper
Casey
Cassidy
Collins
Coons
Duckworth
Durbin
Feinstein
Gillibrand
Graham
Hassan
Heinrich
Hickenlooper
Hirono
Kaine
Kelly
King
Klobuchar
Leahy
Lujan
Manchin
Markey
Marshall
Menendez
Merkley
Murphy
Murray
Ossoff
Peters
Reed
Romney
Rosen
Sanders
Schumer
Scott (SC)
Shaheen
Sinema
Smith
Stabenow
Tester
Van Hollen
Warner
Warnock
Warren
Whitehouse
Wyden
NAYS--37
Barrasso
Blackburn
Boozman
Cotton
Cramer
Crapo
Cruz
Daines
Ernst
Fischer
Grassley
Hagerty
Hawley
Hoeven
Hyde-Smith
Inhofe
Johnson
Kennedy
Lankford
Lee
Lummis
McConnell
Moran
Paul
Portman
Risch
Rubio
Sasse
Scott (FL)
Shelby
Sullivan
Thune
Tillis
Toomey
Tuberville
Wicker
Young
NOT VOTING--8
Booker
Braun
Cornyn
Cortez Masto
Murkowski
Padilla
Rounds
Schatz
The PRESIDING OFFICER (Mr. Kelly). The yeas are 55, the nays are 37.
The motion is agreed to.
The Senator from Ohio.
Stock Buybacks
Mr. BROWN. Mr. President, a week ago today, we celebrated Labor Day,
a day to honor America's workers, a day to honor the labor movement
that built this country and built our middle class. It recognizes all
Americans working hard every day to support families who contribute to
community and power our economy.
Over the summer, as I know that the Presiding Officer has traveled to
Arizona, I have been all over my State of Ohio talking with those
workers: steelworkers in Toledo, busdrivers in Canton, VA healthcare
workers serving our veterans in Chillicothe, union mechanics in
Columbus. They live in different communities. They come from different
backgrounds. But the dignity of work unites all of us.
We take pride in hard work in this country, and we believe, as Dr.
King said and Pope Leo XIII said, that all work has dignity, whether
you punch a clock or swipe a badge, whether you work for tips, whether
you take care of aging parents, whether you are raising children or
whether you are a new grandparent--no matter who you are, where you
live, or what kind of work you do.
For far too many people, hard work isn't paying off. Productivity has
gone up. Stock prices have soared. Executive compensation is
stratospheric. But wages have barely budged. This isn't a coincidence.
It is not an accident of the market. It is not an inevitable result of
our system of capitalism.
Wall Street has the power in this economy. They are obsessed with
accumulating more wealth for the people who already have it. The system
we have, where most of the gains in the economy seem to go to those at
the top, is by Wall Street's explicit design, and it comes at the
direct expense of American workers.
We don't always make the connection. People are rightfully angry, but
they don't think about how decisions in corporate boardrooms and on the
floors of stock exchanges thousands of miles away affect their job
opportunities and their wages.
Corporations focus on their short-term performance on the stock
market, not the long-term success of the company and its workers. Their
main goal too often becomes increasing stock prices quarter to quarter.
That is how CEO performance is evaluated. They are compensated in large
part with company shares. Stocks can account for as much as half of an
executive's compensation package.
Corporations, therefore, juice those stock prices by repurchasing
their own stock, what we call stock buybacks. Here is how it works.
There are a finite number of company shares at any given time.
Purchasing shares will decrease the number of shares available to
investors and therefore drive up the price and the value of the
remaining shares.
Existing shareholders will see their stock value increase. Lo and
behold, often those existing shareholders are the executives of the
company. This is often an even more attractive option to executives
than dividends because buybacks are more flexible and, under current
law, they aren't taxed until the shares are sold. That is what we want
to change.
The economy hasn't always worked this way. A few decades ago, most of
Wall Street capital funded the real economy: wages, machinery,
research, new construction, expansion of the
[[Page S6452]]
company. Stock buybacks used to be considered illegal market
manipulation. Think about that. Stock buybacks then used to be
considered illegal market manipulation.
Today, they have become routine. Now, only 15 percent of capital goes
to the real economy while the amount corporations spend on buybacks has
just exploded. Between 2004 and 2013, Home Depot, a great company by
most measures, in that decade spent 99 percent of its net income on
stock buybacks--99 percent of its net income on stock buybacks. IBM
spent 92 percent.
That is right. Some companies spend close to 100 percent of their
profits on their own stocks rather than workers' wages, rather than
expanding the company, rather than investing in research and
development.
It has only gotten worse since Washington Republicans' 2017 tax
giveaway to these corporations. We all remember--and I have pointed
this out before--the lobbyists down the hall in front of Senator
McConnell's office, the corporate lobbyists that lined up one after
another as Senator McConnell decided, on behalf of his Members and with
President Trump during the Trump-McConnell Presidency--how Senator
McConnell handed these companies a windfall.
Their executives turned around. I remember Senator McConnell, when he
walked down the hall here after doing his conversations--I will just
leave it at that--with his lobbyist friends. He would walk down the
hall, and he would stand at the majority leader's--then the majority
leader--and I think that tax giveaway is part of the reason he is no
longer the majority leader.
But he would say that that is going to trickle down and workers are
going to get raises and companies are going to expand and benefits are
going to go to the whole economy. Well, that is not exactly what
happened. When he handed them that windfall, you know what the
executives did--the executives who were lobbying him, the executives
who were contributing to the campaigns, the executives who control the
Wall Street Journal editorial board? Do you know what they did? They
turned around; they plowed that money right back into stock buybacks,
which meant, lo and behold, right into their own pockets.
The largest U.S. companies--in 2018, right after the tax giveaway,
over a trillion dollars, 70 percent, went to the richest 1 percent.
Don't forget that number. In 2018, the largest U.S. companies spent
more than $800 billion in stock buybacks, a 50-percent increase from
the previous year, a 50-percent increase because they got that largesse
from the Federal Treasury.
They spent more on stock buybacks than on debt payments, than on
capital expenditures, than on research and development, than on
dividends--in other words, the real economy.
Now, in 2021, as millions of families struggle to recover from this
pandemic and get back on their feet, you might think things would
change. We are hearing that a lot of companies--the Presiding Officer
hears it in Arizona; I hear it in Ohio--a lot of companies complain
about supposed labor shortages. You might think that these companies
that are sitting on cash, that it might cause companies to reassess.
They need more workers. Maybe they should cut back on juicing their
stock buybacks, and instead they could permanently raise pay or
increase retirement contributions or offer better healthcare plans or
invest in new training programs--all of those to attract new, better
paid, more satisfied, happier workers. But, no, this year corporate
stock buybacks are on track to approach or even surpass the 2018
record.
Proponents of stock buybacks argue that companies purchase their own
shares only after considering other, value-creating investment options.
In other words, companies are arguing: You know, we do stock buybacks.
Yeah, you are right; it makes us a little richer individually, and we
can buy that third or fourth home in Florida or on the Cape or on Lake
Erie or whatever, but also, we consider everything that would be good
for the company. We funded all that; so then we do stock buybacks.
That is a ridiculous argument. Talk to any family in Cleveland or
Chillicothe or Mansfield or Marietta or Springfield, anywhere outside
of Wall Street. Ask these families if they can think of a better
investment for the trillions--trillions, thousands of billions--
trillions of dollars in wealth American workers have created.
But, of course, executives' personal interests influence their
decision making. One study of 2,500 companies found that the greater
the percentage stock options in executive compensation packages, the
more likely a company was to make stock buybacks. That is fairly
logical. The greater percentage of stock options in an executive
compensation package, the more likely a company was to make stock
buybacks.
So how do we stop this never-ending cycle of corporate greed and make
sure that workers are sharing in the profits they create? We start with
the new bill that Senator Wyden, the chair of the Finance Committee,
and I are introducing: the Stock Buyback Accountability Act.
The Tax Code is one of the best tools we have to influence
businesses. The idea is simple. If you want to buy back your own stock,
you have to pay just a little bit--a 2-percent tax--on the money you
make off of it. Two percent is pretty small. It is a hell of a lot less
than the tax rate that workers at First Solar, which I am going to
visit this week in Perrysburg, are paying or workers at Whirlpool or
workers at the local corner store, at the local Dave's supermarket in
Garfield Heights, are paying.
But that little tax will make companies think a little harder about
whether stock buybacks are really the best use of their trillions in
profits. I hope it will make it a little more likely that they will
invest the money in something useful, something like a new factory or
researching new products or training and apprenticeship programs or pay
raises for the workers who are making these profits possible.
It has to be the goal of any stock buyback plan. It is not about
punishing executives. I am indifferent. I have always believed it is
whom you fight for and what you fight against. I will always fight for
workers in this job. I don't have any interest in punishing executives.
I just don't want to unduly reward them at the expense of workers.
It is about executives paying their fair share just like their
workers do. It is about changing the incentives in our economy so that
more of our country's wealth gets invested back to the people who
created it.
We have known for years that stock buybacks are a problem. They
distort the market. They lead to less long-term economic growth. They
divert investment from workers. That is why it is on worker pay, not
stock buybacks.
We have a real chance to actually do something about it. After years
of politicians talking about reining in Wall Street, now is our
opportunity to do it, to show people we are listening and to take
action.
Worker pay, not stock buybacks. Create a fairer tax system. Creating
a fairer tax system is one of the simplest ways to change the Wall
Street and corporations' first system that Americans are so tired of.
We make this simple fix to finally, finally crack down on stock
buybacks. We get rid of the tax breaks for corporations that ship
American jobs overseas. We make multinational corporations pay their
fair share instead of always, always, always forcing working families
to foot the bill. We crack down on wealthy tax cheats that game the
system. We give working families the largest tax cut ever.
We did that in the bill we passed in March. We are going to do that
in the bills we pass this fall.
It comes back to the dignity of work. Wall Street simply doesn't
recognize that all work has dignity. They consider shareholders' equity
in a company to be all that matters. But workers have equity in a
company too. It is called sweat equity. It is time they were rewarded
for it.
Worker pay, not stock buybacks.
I yield the floor.
The PRESIDING OFFICER (Mr. Brown). The majority leader is recognized.
____________________