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AT&T Plans to Fire 7,000 People Despite Tax Breaks, Net Neutrality Repeal

AT&T Plans to Fire 7,000 People Despite Tax Breaks Net Neutrality Repeal

AT&T Plans to Fire 7,000 People Despite Tax Breaks, Net Neutrality Repeal

When the GOP passed tax reform in 2017 the party justified it's corporate tax cuts claims that the reductions would boost US employment wages and the economy in general. The FCC justified it's repeal of net neutrality by arguing that the regulation of wireless and wireline service was hampering innovation imposing ruinous costs and harming the telcos ISPs and cellular service providers in the United States.
The corporations Ajit Pai and the Republican Party bent over backward to help have not been returning the favor. GM plans to fire 14,000 people. Verizon has no plan to boost 5G investment despite Pai’s claim that repealing net neutrality would lead to additional network spending. AT&T is preparing to fire 7,000 people despite having promised previously that tax breaks and freedom from regulation would create jobs.

What AT&T Said Then?

On May 4 2017 AT&T CEO Randall Stephenson gave an interview to CNBC declaring the importance of cutting taxes. “Lower taxes drives more investment drives more hiring drives greater wages,” said  Stephenson on CNBC’s Squawk Box. “All of this fits together.”
Other choice quotes: “If you can have a tax reduction of 35% down to you pick your number 25 or 20% to think that wouldn’t cause additional investment is nonsensical. I know exactly what AT&T would do: We would invest more.”
Here is a really good one:
“Every billion dollars in additional investment we make is 7,000 additional jobs we have to put on to put that capital into the ground or on cell towers and so forth,” said Stephenson. “7,000 jobs wearing hard hats these are high paying jobs with good benefits. The correlation is very tight. If we have to make that kind of hiring and do that kind of hiring that drives productivity which drives what? Wage growth.” Emphasis added.
In January of 2018 AT&T reported a $19B tax windfall along with an additional $3B in cash that claimed it would spend on network investments throughout 2018. Capital expenditures in 2017 totaled $21.6B. At the beginning of 2018 AT&T forecast capital expenditures of $25B.

What AT&T Says Now

We don’t know how much AT&T actually spent on capital expenditures for the entire year but in Q3 2018 the company stated its estimated capex for FY 2018 would be about $22B. That’s on par with what it spent in 2017 with no increase associated with either the GOP tax bill or the $20B windfall.
Leaked to Motherboard and confirmed by AT&T it tries to dodge its own previous statements claiming that its CEO had already said that $1B in investment creates 7,000 jobs “across the broader economy.” But that’s not what Stephenson actually said.
Stephenson claimed In 2017 that the Trump tax cuts would result in AT&T boosting its investment levels. He knew exactly what AT&T would do: It would invest That investment would create jobs not “across the broader economy,” but for AT&T workers in particular. Hard hat jobs with great benefits and good pay too. The kind of jobs Americans really want. The kind of jobs a CEO would dangle in front of Americans to make them think supporting a giant tax cut and regulatory reduction for corporations was a very good idea. The kind of jobs you talk about when you use a pronoun like We which doesn’t mean other companies besides AT&T.
AT&T has earned record profits for itself by shuttering call centers and offshoring workers with an estimated 16,500 jobs lost since 2011. The Communication Workers of America estimate AT&T eliminated 10,800 positions last year alone.
AT&T claimed were paid out as a result of the Trump tax cuts were actually negotiated beforehand with its unions and had nothing to do with the GOP tax bill. Despite the promise that net neutrality repeal and the tax cut would boost wireless investment overall wireless capital expenditures are believed to have fallen in 2018. And this is not unique to AT&T Verizon also claimed plans to boost its own investment levels before deciding not to.
Instead of creating jobs with every additional $1B in investment AT&T will shed 7,000 jobs to further enrich its stockholders and pay for stock buybacks.

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