Federal tax cuts won’t boost workers’ wages — here’s why
“Recent reports paint a picture of tepid U.S. wage growth, with wages rising just 0.2 percent after inflation in the first quarter of 2018. It wasn’t supposed to be that way. In selling the recentfederal tax overhaul, sponsors claimed that cutting corporate taxes would boost wages for workers. Yet the failure of corporate tax cuts to boost workers’ wages should not be a surprise, our research suggests. In a new paper with Suresh Nallareddy of Duke University we examine changes to state corporate tax rates. We find that when states cut corporate tax rates, most workers’ wages do not rise. Instead, income inequality increases, with most of the benefits of the cuts going to the ultra-wealthy.”