US-based corporations are experiencing record profits, and a significant portion of those profits are being returned to shareholders in the form of dividends. The S&P 500 has seen significant growth this year, with investors expecting dividends to increase. Data from the CME Group shows that dividend payouts to shareholders by companies in the S&P 500 reached a new record in 2023 and are projected to continue growing in 2024. However, a study by Oxfam International revealed that a majority of the profits earned by the largest publicly traded companies in the United States are going to shareholders through stock buybacks and dividend payments, rather than investing in their employees or paying a living wage.
While CEO pay has increased significantly for these companies, only a small percentage have publicly supported paying a living wage. Critics argue that stock buybacks allow executives to benefit financially while disadvantaging workers by diverting corporate profits away from wage increases and growth investments. On the other hand, corporations defend buybacks as an efficient way to distribute excess capital and increase shareholder value. Oxfam’s report suggests that these practices have exacerbated gender and racial inequality in the workplace, as well as income inequality on a global scale.
President Joe Biden has proposed a 25% tax on individuals with more than $100 million in wealth as part of his 2025 budget plan. Large corporations are also managing to avoid high tax rates, with some executives earning more money than their companies pay in federal taxes. The study by Oxfam found that pharmaceutical companies, for example, paid an average tax rate of just 11.6%, well below the 21% corporate tax rate in the US. These findings highlight the disparity in wealth distribution between the ultra-rich and low-income workers, prompting calls for tax reforms to address income inequality.
Former President Donald Trump’s media company, Trump Media & Technology Group, completed a merger with a publicly traded shell company, resulting in a significant financial windfall for Trump. The new company, with Trump as chairman and dominant shareholder, will begin trading on the stock market under the ticker symbol “DJT.” While the merger boosted Digital World shares by 21%, experts caution that the market may be overvaluing Trump Media given its limited revenue and user base decline. Trump Media’s CEO aims to challenge Big Tech censorship through the company’s platforms.
Boeing CEO Dave Calhoun announced his intention to step down by the end of the year, along with the company’s chairman and head of the commercial airplane unit. Calhoun’s decision comes amidst ongoing safety and quality issues that have plagued Boeing for over five years, including fatal crashes of the 737 Max and recent incidents compromising aircraft safety. Boeing has faced multiple groundings and significant financial losses as a result of these issues, prompting a leadership shakeup within the company. The departure of Calhoun and other key executives signals a major shift in Boeing’s leadership structure.
