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stock buybacks
President Trump, President Musk, and the Wedge Issue of Mass Layoffs
Every elected Democrat should be demanding that no taxpayer dollars go to corporations that lay off taxpayers involuntarily. If they don't, what good are they?
Feb 11, 2025
As the Trump-Musk administration takes an axe to the federal government’s budget and personnel, the Democrats have an opening to raise an issue that Musk will hate but Trump can’t ignore—private sector mass layoffs.
Right now, as Acting President Musk goes after agency after agency in the name of cost cutting, the Democrats are focused on public sector job cuts. As they should, tens of thousands of jobs are at risk.
But those numbers pale in comparison to the 1.8 million private sector workers who lost their jobs in December of 2024 due to involuntary layoffs. For the past several decades, more than 20 million jobs per year have been taken away from workers who did nothing wrong.
It won’t be easy to convince private sector workers that cutting federal government costs is a mistake. If you’re living paycheck to paycheck, you don’t want your tax dollars squandered, and USAID., to many, sounds like a money pit.
If the Democrats act forcefully to defend working-class jobs, they should have better chance to win back Congress from Trump in 2026.
But private sector workers do care about their own job insecurity, and Donald Trump knows it. He has spoken forcefully about keeping worker jobs from migrating to Mexico and elsewhere, and he could take actual action to make that happen with one simple Executive Order:
Corporations that receive taxpayer money via federal contracts and tax subsidies shall not lay off taxpayers involuntarily.
More than $750 billion in contracts for materials and services are made each year by the federal government. Many of the corporate recipients have had no qualms about laying off workers and using the savings to enrich their investors via stock buybacks, and there have been no effective rules to prevent this. (A stock buyback is when a corporation repurchases its own shares, thereby raising the price of the stock without improving the company in any material way.)
Taxpayers know there is a great deal of waste built into federal contracts, especially those massive purchases involving defense and advanced technologies.
It turns out that Musk’s companies, reportedly, have received $20 billion in federal contracts, with $15.4 billion coming to Tesla and Space X in the last decade. Last year, Tesla laid off more than 14,000 workers, and Space X has announced that this year it will lay off more than 10 percent of its workforce, about 6,000 jobs. Imagine if Musk were not allowed to stuff himself with taxpayer money unless he refrained from involuntary layoffs?
To get there the Democrats, for the first time in memory, would need to care about greed-driven private sector layoffs.
That will be difficult because the Democrats are more in tune with highly educated, upper middle-class federal workers. These are the kind of voters who have been trending Democratic while the party has shed the working class. And the Democrats see the federal agencies in which these voters work as part of their legacy, often created and enhanced by legislation they spear-headed. Federal workers are their people, doing the work that the Democrats care most about.
Not so much the private sector, where voters have been drifting away from the Democrats in large numbers for decades, especially in the swing states of Michigan, Pennsylvania, and Wisconsin. As I show in Wall Street’s War on Workers, since 1992, as a county’s mass layoff rate has gone up, the Democratic vote has gone down, even as these voters have grown more liberal on social issues.
The Democrats have been losing these working-class voters because they have failed to interfere in private sector layoff decisions, even when job destruction became a campaign issue.
For example, in the run up to the 2024 election, John Deere and Company announced they were shipping more than 1,000 jobs to Mexico while recording $10 billion in profits and conducting $12.2 billion in stock buybacks. Trump immediately called for a 200-percent tariff on all Deere imported goods if they didn’t rescind their layoffs.
The Democrats didn’t say a word about how to stop this needless job destruction and instead attacked the tariffs. Deere’s stock buybacks and profits proved the company had more than enough money to offer voluntary buyout packages for all their workers, not just the executives. But the Democrats did not speak up.
During the height of the COVID-19 pandemic, the Democrats also remained silent when the Mylan Pharmaceutical plant in Morgantown, WV, moved to India. Workers there begged the Democrats to use the Defense Production Act to keep open the facility, which made generic drugs. If Biden could do it for baby formula, why not for badly needed pharmaceuticals?
But not one Democrat came out in support of these workers, and 1,500 jobs with an average wage of $70,000 per year were tossed away.
Clearly, the Democrats have been pulling away from the working class. Why help these workers, some are saying, when they’re more than likely to vote for Republicans? And why challenge corporate power when you’re trying to win over highly educated executives and financial leaders?
Democratic Senate Minority Leader Chuck Schumer, who is up and arms these days about the attacks on federal workers, was very honest about this switch in 2016. I’ve quoted him again and again because he tells us precisely what the Democratic strategy has been all about:
"For every blue-collar Democrat we lose in western Pennsylvania, we will pick up two moderate Republicans in the suburbs in Philadelphia, and you can repeat that in Ohio & Illinois & Wisconsin."
At the launch of a second Trump presidency, Schumer’s political acumen has not aged well.
Nor has Ken Martin’s, the new chair of the Democratic National Committee, who has made it clear that billionaires are welcome.
“There are a lot of good billionaires out there that have been with Democrats, who share our values, and we will take their money, but we’re not taking money from those bad billionaires,” Martin said recently.
It is doubtful that Martin ever gave one second’s thought to the fact that most, if not all, of these “good” billionaires that “share our values” have grown wealthy from, to some significant extent, stock buybacks funded through mass layoffs.
The country needs the Democrats to go from defense to offense. If the only activity is mounting a resistance movement to Trump, the odds are slim that enough new voters will be gained to win back the House or the Senate in 2026.
Every elected Democrat should be demanding that no taxpayer dollars go to corporations that lay off taxpayers involuntarily. They should put that message on social media, old media, even billboards all over the swing states. They should challenge every Republican candidate to take a stand on it. It doesn’t cost the taxpayer one dime, but it can protect the livelihoods of millions of working people every year. Or, at least, give them leverage while working out their severance.
Every day Democrats should be asking Trump to sign the order. Does he really want to be seen giving our tax dollars to corporations that lay off taxpayers and funnel the savings to the rich?
And wouldn’t it be good for our weary souls to see Musk squirm because he wouldn’t be able to sup at the federal trough while casually laying off his employees?
You have to wonder if the Democrats are capable of such a move, or anything remotely close to it. Only if they truly are willing to take on Wall Street and the billionaire class. They need to believe, not just mouth the words, that they will fight the wealthy to protect the livelihoods of working people.
If the Democrats act forcefully to defend working-class jobs, they should have better chance to win back Congress from Trump in 2026. But in the short term, pushing Trump to defend his populist flank might help put a wedge between Trump and his billionaire bros, and get some relief for workers from financialized layoffs.
But don’t hold your breath. All those “good” Democratic billionaires might get upset.
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Public Banking in a Time of Crisis: How to Rebuild Los Angeles
From LA’s wildfires to Asheville’s floods, disasters are intensifying and demand resilience. Public banking offers a blueprint for recovery: leverage public dollars to cut long-term costs, create jobs, and rebuild smarter.
Feb 04, 2025
On the night of January 7th, as the Palisades Fire surged to 2,000 acres to the west and the Eaton Fire exploded to 1,000 to the east, I joined thousands fleeing hurricane-force winds that hurled embers for miles. But while I evacuated out of precaution, across Los Angeles, many Angelenos were not as fortunate. Like so many here, I spent those first sleepless nights glued to wall-to-wall news coverage, tracking the fires’ paths. But while flames dominated headlines, a slower crisis burns, one that Los Angeles has yet to confront.
Caught in a cycle of destruction and recovery that grows more urgent every year, fire season is no longer a season—it’s a year-round threat. Entire neighborhoods in Altadena have lost more than homes—they’ve watched their generational wealth turn to rubble. In Pacific Palisades, emergency teams scrambled to stabilize hillsides before landslides erased what remained. With wildfire losses now climbing past $250 billion, one question echoes through the city: Who pays to rebuild? And how can we do it faster, smarter, without sinking deeper into debt?
Los Angeles isn’t the first to face this reckoning. Back in 1997, Grand Forks, North Dakota, suffered a catastrophic flood. Their city was left in ruins, but they had something most cities don’t: the Bank of North Dakota (BND), America’s only state-owned public bank. Within two weeks, the BND funneled around $70 million in credit for emergency operations and rebuilding. While FEMA took months to distribute aid, the BND’s local presence and public mandate allowed it to act with precision. ND mortgage holders got six-month payment pauses. Show me one Wall Street bank that’s offered that kind of breathing room.
Caught in a cycle of destruction and recovery that grows more urgent every year, fire season is no longer a season—it’s a year-round threat.
This is the power of public banking: swift, people-focused, and designed for crisis response. Unlike profit-driven institutions, a public bank—owned by a city or state—would reinvest public deposits into local resilience rather than shareholder dividends. Imagine transforming tax dollars into a renewable resource: funding fire-resistant infrastructure, upgrading aging power grids, and keeping families housed during disasters.
Look around Los Angeles today. Insurers flee high-risk areas, leaving families stranded. Meanwhile, we’re sending more than $1.4 billion a year in debt service fees to Wall Street—this staggering sum, outlined in the City’s 2024/25 Adopted Budget (Page R-71), is money that could fortify hillsides or retrofit homes. Governor Newsom’s $2.5 billion wildfire package helps clear debris, but it doesn’t address the bigger question: How do we fund tomorrow’s disasters without predatory loans that bleed the city dry?
A public bank is the answer. Picture the Bank of North Dakota model scaled for a metropolis. Need emergency credit after the next natural disaster? Done. Low-interest loans for small businesses distributing supplies mid-crisis? No delays. By partnering with local lenders, a public bank could bridge the gap for families waiting months or years for insurance payouts.
This is the power of public banking: swift, people-focused, and designed for crisis response.
This isn’t fantasy. A national public banking movement is rising. In 2019, California passed the Public Banking Act, clearing the legal path for cities like Los Angeles to establish their own public banks. New York City plans a public bank to fund affordable housing and support minority communities. Florida eyes the model for local control of state resources. From San Francisco to New Jersey, cities and states recognize that megabanks can’t meet the scale of today’s economic and environmental challenges. Public institutions keep dollars local, funding fire-resilient housing, green energy projects, and businesses that anchor communities during crises.
During COVID-19, the Bank of North Dakota proved this again. While Wall Street prioritized corporations, the BND partnered with community banks to quickly deliver relief to small businesses and frontline workers. Los Angeles deserves that same agility. A public bank could centralize disaster funds, slash bureaucratic delays, and ensure every dollar stays local—rebuilding neighborhoods instead of enriching distant shareholders.
Housing offers another critical test. Today, financing affordable projects takes years as developers navigate a maze of private lenders. A public bank could create a housing fast-track fund, offering below-market loans for shovel-ready developments. Interest payments would recycle into future projects, not Wall Street bonuses. Streamlined funding means lower costs, faster construction, and more Angelenos housed before the next disaster strikes.
The fight isn’t about resources—it’s about control. A public bank keeps investments local, ensuring funds flow to priorities like firebreaks and microgrids rather than stock buybacks.
Critics argue public banks risk politicization. But the BND’s 105-year track record in a solidly red state disproves this: it's rated A+ by S&P with an 18.2% return on equity in 2023. It’s safer than most big banks and exceptionally stable as a public institution. By law, California’s public banks won’t compete with local community banks, instead, they will partner with them, expanding access to credit in underserved communities.
The money to capitalize a public bank exists. We’ve already raised billions for disaster recovery. The fight isn’t about resources—it’s about control. A public bank keeps investments local, ensuring funds flow to priorities like firebreaks and microgrids rather than stock buybacks.
From LA’s wildfires to Asheville’s floods, disasters are intensifying and demand resilience. Public banking offers a blueprint for recovery: leverage public dollars to cut long-term costs, create jobs, and rebuild smarter.
Los Angeles can lead this revolution. By creating the nation’s first major urban public bank, we’ll pioneer a model for cities nationwide. When the next disaster strikes, we won’t be at the mercy of for-profit banks, we’ll have the tools to rebuild ourselves—faster, fairer, and permanently stronger. The alternative is unthinkable: another decade of rubble, debt, and avoidable loss.
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Are You Still Wondering Why Workers Voted for Trump?
The frustration, the resentment, the anger about the rigged system was building long before Donald Trump came on the scene.
Jan 01, 2025
I just had a chat with an ATT office manager, a young Black man who is very attentive to his customers. After he learned that I worked with labor unions, he said, “I’ve always wanted to be in a union. My dad was a bus driver, and his earnings and benefits really took care of us. Our healthcare was amazing, $5 co-pay and that was it, no matter what the medical procedure.”
His comments both made me sad and angry. He took me back a few decades, when working people still earned a decent living. That’s the period before runaway inequality and job destruction basically wiped out the American Dream for the working class.
It’s not like we can’t afford to pay people decently. The money is there and then some. In 1980, there were 13 billionaires in the U.S. In 2023 there were 801. The top one-tenth of 1% saw their collective wealth jump from $1.8 trillion in 1990, to $22.1 trillion in 2024. For some context, the U.S. federal budget in 2024 was $6.8 trillion. Or consider that there are 197,500 bus drivers in the U.S. One trillion dollars could pay them $100,000 a year for 57 years.
Have the Democrats learned anything from Trump’s ascendency? The jury is out. Will they actually take on the financial barons? Or will they continue to take in the money that flows so strongly from Wall Street and Silicon Valley?
Meanwhile the average income after inflation of the average worker did not rise at all from 1980 to 2024. And as we all know, during that time healthcare costs have gone through the roof for nearly all of us.
To add to working-class misery there is never ending job insecurity. One in four employed workers fear they will lose their jobs within the next year, according to polling done by Colorado State University.
And there’s a very powerful connection between job loss and enriching the super-rich. In many, if not most, cases, mass layoffs are used to free up cash for companies to pour into stock buybacks—buying back the corporation’s own shares to artificially boost its price. This moves money into the pockets of the largest Wall Street stock-sellers and the companies’ CEOs, who are mostly paid with stock incentives. In a very real way workers are sacrificing their jobs to enrich the richest of the rich. (To see why mass layoffs have little or nothing to do with AI and other new technologies please see my book, Wall Street’s War on Workers.)
In our capitalist economy there has always been a fierce struggle between corporate power and worker power. But when unions represented 25-35% of the private sector, during the post-WWII era, working people had sufficient clout, like that bus driver dad, to provide a good standard of living for their families. Today, with only 6% of the private sector workforce represented by labor unions, the balance has shifted strongly toward corporate power, and wages, benefits, and job security have gone backward.
The power imbalance is so great that our conventional wisdom has changed. Our minds have been warped by corporate power. When unions were strong, runaway inequality was viewed as out and out greed. Today, we are told it’s just the result of entrepreneurial brilliance, that we all benefit from the creation of more and more billionaires, that those left behind simply lack the skills to succeed in our modern economy.
But that bus driver still drives a bus, taking people to work and the doctor or shopping, using much the same skills as generations ago. The difference today is that instead of earning a living wage, as the bus driver once did, workers don’t have sufficient power to gain a decent standard of living. Relegated to gig work or jobs under threat of layoffs, the system is rigged against them.
Historically, working people saw the Democratic Party as the defender of the working-class. Not so today. Instead, they see politicians of both parties as just another group of elites feathering their own nests and protecting the establishment. Very few representatives are seen as willing to take on Wall Street and stop needless mass layoffs, because apart from some occasional rhetoric we don’t see politicians fighting for workers.
The frustration, the resentment, the anger about the rigged system was building long before Donald Trump came on the scene. But there he is, a giant wrecking ball, slamming away at the established order. For those left behind, smashing the establishment feels long overdue.
Have the Democrats learned anything from Trump’s ascendency? The jury is out. Will they actually take on the financial barons? Or will they continue to take in the money that flows so strongly from Wall Street and Silicon Valley?
Looking at the Democrats’ post-election discussions, it could be a long wait until our ATT union-supporter gets a chance to join a union.
Let’s try to have a happy new year, but it is likely to be a tough one for the working class.
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