There’s an insane phenomenon called “prosperity gospel” where preachers tell their audiences to send them tons of money so they can live lives of luxury/private jets. Cenk Uygur, host of the The Young Turks, breaks it down. Tell us what you think in the comment section below. “If you’ve ever wondered why some Christian preachers must hopscotch the globe in fancy private jets, it’s in part so that they don’t have to get on commercial planes with the “demon” common folk. Preachers from the so-called “prosperity gospel” movement, Kenneth Copeland and Jesse Duplantis, tried to explain their controversial need for their followers to give up their hard-earned dollars so they can fly in luxury in an interview posted Wednesday. Copeland then pointed out he could “scratch my flying itch” by riding around in his single-engine, open-cockpit plane. “But we’re in soul business here,” he said. “We got a dying world around us. We got a dying nation around us. And we can’t even get there on an airline.””*
The Stock Buyback Panic
Repurchases reallocate under-utilized capital to more efficient purposes.
Stock buybacks are the latest bipartisan piñata, whacked by politicians on the left and right who misunderstand capital markets. A refresher course is in order lest Congress stampede and undermine the investment needed for growth.
Repurchasing shares is simply one way a company can return cash to owners if it lacks better ideas for investment. Tax reform increased corporate cash flow by cutting tax rates and letting companies repatriate their cash held overseas by paying a one-time tax rate of 15.5%.
Using Federal Reserve data, Dan Clifton of Strategas Research Partners estimates that companies repatriated $730 billion in 2018. CEOs have deployed that for multiple purposes including new investment, debt reduction, pension contributions, employee bonuses, wage and dividend increases and stock repurchases.
This is a policy success. Mr. Clifton calculates that capital expenditures by S&P 500 companies grew about $75 billion in 2018, the fourth-biggest annual gain since 1991. Average wages are growing by at least 3.4% year over
.. The Senators complain that “when corporations direct resources to buy back shares on this scale, they restrain their capacity to reinvest.” But the money doesn’t fall into a black hole. An investor who sells stock into a buyback will save or reinvest the proceeds. Walmart gives shareholders cash, and capital markets redirect it to some other useful end.
Banning buybacks won’t create better investment options inside companies. Instead CEOs may spend more on corporate jets or pet projects with marginal economic returns. They could let cash pile up. They could raise dividends, which would also move cash toward better investments. But Messrs. Schumer and Sanders likewise want to “seriously consider policies to limit the payout of dividends, perhaps through the tax code.”
Nikki Haley is the latest Trump Cabinet official to leave under an ethics cloud
We have no idea if her abrupt decision was somehow connected to her ethics woes. But they are substantial, and she departs with her once-spotless reputation badly tarnished. As our watchdog group has documented, Haley has, over the course of her tenure in the Trump administration, exemplified the ethical problems that have afflicted it from the president on down. Indeed, her resignation became public a day after we filed our latest of several complaints against her,
.. a disregard for our most basic ethics laws — in her case, ethics regulations governing gifts to officials and the Hatch Act limiting her political activity.
.. Haley accepted flights on private planes likely worth tens of thousands of dollars from several businesspeople who had supported her past campaigns, which could violate ethics rules and standards. In doing so, she risked creating at least the appearance that she sold access to the highest level of American foreign policy to businesses that had donated to her campaign for governor. Like Pruitt’s notorious luxury condo rental that he priced at $50 a night, far below market rates, Haley reported the value of her flights on these private jets at only hundreds of dollars apiece. That strains credulity when flights on private jets routinely cost far more.
.. many of her flights were on aircraft owned by the donors’ companies, and it is unclear whether the executives repaid the companies for the full value of the flights.
.. Haley’s obsequious performance during her resignation announcement underscored this president’s complete personal sway over his administration. She entered the job as a former adversary of Trump’s, and she showed an independent streak while serving. That was not in evidence as she praised the president, sang the unseen “genius” of his son-in-law, Jared Kushner, and declared that “the U.S. is respected.” The president’s disdain for ethical values, which Haley has regrettably emulated, has helped make the opposite true.
The Trump Administration’s Undrained Swamp
Many executive officials seem okay with spending public money on personal expenses, but how would they react if Hillary Clinton were doing it?
.. But if ever there were a crew less suited to drain the swamp in Washington, the Trump team would have to be it.
.. Remember Secretary of Health and Human Services Tom Price? You may not, since his tenure was less than nine months long. But in that time, according to Politico, he ran up $400,000 in private-plane trips and $500,000 for military flights to Asia, Africa, and Europe.
.. There were also questions raised about his private investment in a company that stood to benefit from his public action.
.. Steven Mnuchin and his wife Louise Linton jetted off to Kentucky last August on a government plane to (depending upon whom you believe): do Treasury business or view the solar eclipse.
.. The couple also apparently requested a military plane for their honeymoon trip to Europe.
.. Secretary of Veterans Affairs David Shulkin also took his wife to Europe for a ten-day trip.
.. Environment Protection Agency administrator Scott Pruitt, reports the Washington Post, is also being investigated for “at least four noncommercial and military flights
.. I find it hard to think of an EPA emergency that would require Scott Pruitt to fly on a military jet
.. the complicated web of loans and investments and connections Jared Kushner brought with him to the swamp
.. one of the reasons his security clearance was downgraded this week involved accepting loans from a private equity billionaire named Joshua Harris.