As the destruction of America’s retail sector continues, 3,800 stores are set to close in 2019. Don’t expect to see executive bonuses decrease, however.
By Donald Jeffries
Corporate America, along with pliable and ineffective politicians, has destroyed U.S. industry with horrendous trade deals and cheap foreign labor.
They have done the same thing to retail operations nationwide. Hedge fund managers and investment analysts have supplanted company presidents who often had a personal or familial stake in their businesses. Despite his campaign rhetoric to the contrary, companies are moving offshore at a record pace under President Donald Trump, and the H-1B Visa worker program, which could have been ended with the stroke of a presidential pen, still lives.
Recently, a bankruptcy judge approved a plan by Sears to award over $25 million in bonuses to the executives who presided over the company’s bankruptcy proceedings in October.
Once Sears Holding Corp. took over Kmart in 2004, stores began closing regularly all over the country. In an egregious example of corporate welfare in 2011, Sears Holding Corp. threatened to move its headquarters out of Illinois, as NFL team owners often do, before being granted a lucrative $275 million “subsidy package” by the state. Eleven days after getting this taxpayer largesse, Sears announced the closing of 120 stores nationwide. As of the end of 2018, Sears Holding Corp. is in the process of closing 188 more. This didn’t stop them from handing out $25 million in executive bonuses.
Under a globalist, predatory system, there is little competition and a startling culture of incompetence. Executive compensation seems to be the only thing that counts. Executive bonuses are permitted, often ludicrously, to be labeled “performance based,” which became essentially tax-free in 1993.
The Trump administration’s tax reforms of 2017 rather shockingly eliminated the deduction for “performance based” executive bonuses. Such bonuses were rarely earned and, in many cases, belied the utter failure of the lucky recipient.
“Golden parachutes” became extremely popular in the corporate world of the 1990s and by the 2000s they were all the rage. While CEO of Hewlett-Packard, Carly Fiorina oversaw the significant decline of the company and instituted massive layoffs. Asked to leave in 2005, Ms. Fiorina was given an astounding $40 million to basically go away. Incensed by the payout, HP’s stockholders filed a class-action lawsuit, which a federal judge predictably dismissed in April 2008. Somehow emboldened by her failure, Ms. Fiorina became a top advisor to Sen. John McCain (R-Ariz.) and then actually ran for president herself in 2016.
Several golden parachutes are known to have been larger than $100 million. Topping them all was the $417 million given to long-time General Electric CEO Jack Welch. Welch oversaw several years where the corporate giant paid no taxes whatsoever, but he also was mired in personal corruption. Now GE is on the verge of collapse.
AT&T is earning record profits and expects some $20 billion in savings from Trump’s tax reforms yet continues to shut down call centers across the country, in favor of moving offshore to lower-salary locations like Mexico, India, and the Philippines. In December 2017, AT&T memorably announced generous bonuses for all its employees in the wake of the new tax package. What they neglected to mention is that the union had already negotiated these bonuses.
While CEO Randall Stephenson promised to invest a billion dollars in the United States to create some 7,000 “hard hat jobs that make $70,000 to $80,000 per year,” the company has actually laid off an estimated 7,000 employees since that announcement. The union filed an unfair labor practice claim against AT&T over its failure to disclose its plans regarding new tax reinvestments in May 2018, declaring, “We don’t feel confident in what AT&T tells us.”
Comcast, like AT&T, boasted of giving bonuses already decided upon before the new tax package, and then celebrated by laying off 500 members of its sales department just before the Christmas holiday.
Trump, who certainly understands the nuances of bankruptcy law, chastised Sears Holding Corp. in October for being “improperly run” and called the bankruptcy “a shame.” He noted, “Somebody that is of my generation—Sears, Roebuck was a big deal.” Trump’s Treasury Secretary Steven Mnuchin sat on the Sears board of directors during the time it was being “improperly run.”
Reflecting upon the general demise of retail in America, Business Insider noted in October: “The retail apocalypse has descended on America. More than 3,800 stores are expected to close across the country this year. Department stores like Macy’s, Sears, and JCPenney, and retailers including Toys “R” Us, BCBG, Abercrombie & Fitch, and Bebe have decided to close dozens of stores. . . . Sears isn’t the only company that is struggling to adjust to the rise of e-commerce and the fall of foot traffic. With vacancy rates continuing to rise, walking through a mall in 2018 is like walking through a graveyard.”
Store closings are part of the “new normal” in America, along with stagnant employee wages, foreign workers, offshore production, and ever-increasing executive compensation.
Donald Jeffries is a highly respected author and researcher whose work on the JFK, RFK and MLK assassinations and other high crimes of the Deep State has been read by millions of people across the world. Jeffries is also the author of two books currently being sold by AFP BOOKSTORE.