Stock buybacks, which allow corporations to artificially inflate the value of their stocks, were illegal until 1982. Because stock buybacks create an artificial demand, they force stock prices above their natural level. Corporations spend most of their profits on buying back shares of their own stock rather than investing them in facilities, R&D, or employee wages. The income of working-class people - the true creators of wealth - has remained stagnant for the past 35 years, while the income of CEOs has increased enormously. Today a larger proportion of a CEO's pay is in stocks and stock options rather than cash. Trump's tax cuts to corporations has pumped up profits, setting buybacks on track to new records.
Stock buybacks do not help companies, only wealthy executives. Allowing this unethical practice has allowed the rich to get richer and richer at the expense of the working class. It is time for stock buybacks to be outlawed again - and forever.
