Skip to main content

Sign up for our newsletter.

Quality journalism. Progressive values. Direct to your inbox.

In this photo illustration, a smartphone displays the Walmart Inc. market value on the stock exchange via the Yahoo Finance app.

In this photo illustration, a smartphone displays the Walmart Inc. market value on the stock exchange via the Yahoo Finance app. (Photo Illustration: Guillaume Payen/SOPA Images/LightRocket via Getty Images)

House Hearing Highlights How Corporate Stock Buybacks Enrich the Wealthy While Rigging Economy Against Workers

"The biggest American companies are clearly making enough profit to spend these record amounts giving raises to their shareholders via stock buybacks, and yet average workers aren't getting any raises."

Eoin Higgins

The House Financial Services Committee on Thursday held a hearing about one of the main ways the one percent keeps money in the hands of the richest Americans—stock buybacks—winning praise from progressives for shining a light on the practice.

"It's time for Congress to listen to how our economy is rigged against working people," advocacy group United for Respect said in a tweet.

The hearing, chaired by Rep. Maxine Waters (D-Calif.), featured testimony from Janie Grice, a Walmart worker and United for Respect member. Grice told lawmakers that she was upset to find out the company used $20 billion in profits for stock buybacks instead of giving that money to employees.

"I don't mind investors making profits," said Grice. "I do mind when associates like me, who have been putting the work in, day after day and year after year, don't get to share in those profits."

According to University of Massachusetts economics professor Lenore Palladino, stock buybacks represent yet another example of how inequality works in the U.S.

"Gains from share selling flow disproportionately to a small group of wealthy households," said Palladino.

Rep. Carolyn Maloney (D-N.Y.) noted that stock buybacks can also be used to manipulate valuation for profit.

"Executives can use a buyback program to boost the company's stock price, right before selling their own stock at these artificially inflated prices," said Maloney.

In a statement, Patriotic Millionaires chair Morris Pearl said the policy has negative long-term implications for companies and employees.

"The plain truth is that spending corporate profits on raising worker wages and investing in new jobs, instead of spending it on stock buybacks that only serve to make rich investors even richer, will actually help all of those business people and investors make more money simply because workers will have more money to spend," said Morris. 

"Spending billions on stock buybacks, instead of reinvesting that money where it's needed most, is a shortsighted, unsustainable decision to enrich shareholders," Morris added.


Our work is licensed under Creative Commons (CC BY-NC-ND 3.0). Feel free to republish and share widely.

We've had enough. The 1% own and operate the corporate media. They are doing everything they can to defend the status quo, squash dissent and protect the wealthy and the powerful. The Common Dreams media model is different. We cover the news that matters to the 99%. Our mission? To inform. To inspire. To ignite change for the common good. How? Nonprofit. Independent. Reader-supported. Free to read. Free to republish. Free to share. With no advertising. No paywalls. No selling of your data. Thousands of small donations fund our newsroom and allow us to continue publishing. Can you chip in? We can't do it without you. Thank you.

Warnock Defeats Walker in Georgia, Giving Democrats 51-49 Senate Majority

"Tonight, the people—young, Black, Brown, and working people—expanded the Senate majority, neutralized the power of Joe Manchin, and defeated yet another fascist," the Sunrise Movement cheered.

Brett Wilkins ·


'About Damn Time': NY Jury Finds Trump Organization Guilty on All Counts of Tax Fraud

"Today's guilty verdict against the Trump Organization shows that we will hold individuals and organizations accountable when they violate our laws to line their pockets," said New York Attorney General Letitia James.

Brett Wilkins ·


Oxfam Rebukes EU Over Delayed Deal on Global Minimum Corporate Tax

"This is a loss to ordinary people who are struggling with the cost-of-living crisis and a win to the ultra-profitable corporations," said the group's tax expert for the bloc.

Jessica Corbett ·


Global Biodiversity Summit Called 'Make-or-Break Moment' for Wildlife

"The deluded dreams of billionaires aside, there is no Planet B," said U.N. Secretary-General António Guterres. "We must fix the world we have."

Julia Conley ·


Congressional Progressives, Climate Activists Rally Against Manchin's 'Dirty Deal'

"As if spending $847 billion on the military-industrial complex wasn't bad enough," said Rep. Rashida Tlaib, "now they want to add sacrificing frontline communities for polluter profits to the package?"

Brett Wilkins ·

Common Dreams Logo