Statement: Roosevelt Institute Senior Economist Applauds ‘The Worker Dividend Act’ Introduced by Senator Cory A. Booker
Measure would require companies to provide a commensurate benefit for employees when CEOs, shareholders benefit from stock buybacks
NEW YORK, NY — Earlier today, Senator Cory A. Booker (D-NJ) introduced “The Worker Dividend Act,” legislation that would require companies to pay their workers a sum commensurate to the financial windfall gained by CEOs and shareholders as a company engages in stock buybacks. Today’s measure comes on the heels of an avalanche of recent stock buybacks, in which a corporation re-purchases their own shares of stock on the open market at the going price; indeed, stock buybacks are double what they were in January and February of 2017 and have surged since the GOP passed their tax plan in late 2017.
“For over three decades, shareholders and corporate executives have used stock buybacks as a way to enhance their own pay often at the expense of workers,” said Lenore Palladino, Senior Economist and Policy Counsel at the Roosevelt Institute.
“The proposal introduced by Senator Booker recognizes the important role stock buybacks have played in the high-profit, low-wage economy we see today, and it is an important step in a series of efforts needed to address it.”
For years, Palladino and the Roosevelt Institute have decried the ways that unchecked corporate power and runaway inequality distort the economy. In January, Palladino released a report, “Corporate Financialization and Worker Prosperity: A Broken Link,” which details the ways that excessive short-termism and financialized corporate practices like stock buybacks are driving economic inequality.
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