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In Defense of Stock Buybacks
I vote blue no matter who, because today’s Republican Party is a coalition of morons and assholes. But I’m not a Democrat, not a liberal (except maybe in the classical sense), and not a progressive. I vote against Republicans, not for Democrats, which means that every so often I feel obliged to call out just how dumb Democrats are. Today’s rant is about stock buybacks.
In his recent State of the Union address, President Biden said:
Corporations ought to do the right thing. That’s why I propose we quadruple the tax on corporate stock buybacks and encourage long-term investments.
I have no problem with a democratically elected government telling businesses what they can and can’t do. Congress is where investors, entrepreneurs, workers, and consumers meet to negotiate the way businesses will compete. Most laws regulating business are essentially alternatives to boycotts. If we don’t want products made by children, we could boycott them. Instead, we pass a law banning child labor. Same thing, more cleanly done. Sometimes, bans are effected by excise taxes; the power to tax is the power to destroy.
So, Should we boycott companies that buy back their stock? Or, to use President Biden’s words, is a company that buys back its stock failing to…