Bogle Says Tax Bill Favoring Business Is a ‘Moral Abomination’By
The tax proposals in Washington are a “moral abomination” because they favor corporations at the expense of workers, Vanguard Group founder John Bogle said.
“Just think about this: Corporate profits after taxes last year were the highest they’ve ever been in the history of GDP going back to 1929,” said Bogle at an event Tuesday sponsored by the Council on Foreign Relations in New York. “And we are thinking of giving relief to the corporations at the highest levels ever. Individual wages are at the lowest level in about 15 years as a percent of GDP,” he said.
“So we are helping people who are doing very well and doing nothing for the people doing very badly,” said Bogle. “One of the flaws is that corporations are putting their shareholders ahead of the people that built the corporation, the people who put their heart and soul” in the company.
“It’s just the unfairness,” he said.
Bogle, 88, said the “worst part of it is that corporations are making so much money now that they don’t know what to do with it. They aren’t investing in new equipment, in innovation. They’re buying back their own stock,” which helps the stock price, he said.
“I’m all for capitalism,” he said. “I’m a capitalist myself. But there is such a thing as too much.”
Among his other comments:
- Investors should avoid bitcoin “like the plague.” The cryptocurrency “has no underlying rate of return,” he said.
- Most of the regulations placed on mutual funds and banks “are ones we earned” due to mistakes made.
- Stock returns are likely to be about 4 percent over the next decade.