Moneybeat - No sympathy for unions in Alabama

MARY REICHARD, HOST: Next up on The World and Everything in It, the Monday Moneybeat.

NICK EICHER, HOST: Several items to talk about in the world of business, economics, and finance from the unionization battle with Amazon, to political activism in corporate America, and global taxation. Here to talk about it now is financial analyst and adviser David Bahnsen. Good morning.

DAVID BAHNSEN, GUEST: Good morning, Nick, good to be with you.

EICHER: David, this vote to unionize a large Amazon warehouse in Alabama was receiving lots of attention in the business press, and it was pretty big, given that the president of the United States weighed in on the side of the union organizers. So, pretty closely watched unionization vote, and the result was a blowout against a labor union: 71 percent against. David, what’s the import of this to your mind?

BAHNSEN: The import would have been if went the other way. So it’s kind of a non story because of the way it went. But it would have been a big story had gone the other way.

It’s really fascinating. I happen to know that President Biden was also giving backdoor whisperings through aides and staff to the other side that, you know, he didn’t believe it was gonna go through and, and, you know, understood that this was complicated and supported tech. And then he was playing the public game of, you know, wanting to support this idea of unionization.

So it’s a very odd circumstance, because you have really on the left, just that progressive Bernie camp really pushing this issue, and a very, very large constituency of what all of us would consider to be the left: big tech, Silicon Valley, you know, a lot of social left wing environmental types that are all on the other side of the issue. So this is much more of a civil war issue within the left. And the big tech companies are going to successfully fight off unionization for quite some time. And the Bernies and Liz Warrens are going to push for it. And the best thing you and I can do is just sort of grab some popcorn.

EICHER: The Wall Street Journal had an article titled, “The Business of Business is Politics and CEOs are ill prepared for the kind of politics that’s being required of them.” The two big corporate political plays the last few weeks were around Georgia’s voting law, by two huge Georgia-based businesses, Coca-Cola and Delta Airlines, and this raises the idea of Woke Capitalism. Is this as big a story as the Journal suggests?

BAHNSEN: Yeah, well, there’s kind of two different things going on there. I think it is the fundamental fight within corporate America right now for their principles of free enterprise, and their virtue signaling that’s taking place in the culture war.

And it’s something I write about constantly. I was on Kudlow’s show on Fox this week, talking about my company, we had sold well over $50 million this week of Coca Cola stock. And I do not sell stock and I do not buy stock because of the political views of their C suite. They have to do something to harm shareholders to get me to sell, and all their pomp and circumstance about environmental stuff here and LGBT stuff there, those things do not end up generally harming shareholders. And I don’t really believe most in corporate America believes the nonsense they spew on some of this stuff.

Coca Cola, actually put a mandate out that they were going to not pay invoices to law firms until they can see their employee survey and understand their hiring practices around diversity, sexual orientation, racial diversity, trans gender, all these things.

Listen, Coca Cola is in the middle of a $9 billion dispute with the IRS. This is no time for them to be playing around this stuff with their legal and accounting firms. So we made the decision to exit and and it’s not a decision I made lightly I assure you. So I would just tell you that I think a lot of the woke capitalism stuff going on in corporate America is very distressing. But a lot of it is not actionable. A lot of it is just Phariseeism. And and marketing and other things. And some of it is real.

EICHER: Before I let you go, the debate is taking shape over corporate taxation, raising corporate taxes to pay for the president’s $2-trillion infrastructure bill. But I want to home in on one point and that’s the effort of the Treasury Secretary, Janet Yellen, negotiating with foreign governments for a kind of global minimum tax. The idea being to collectively agree not to undercut one another to compete for corporations to shift operations to lower-tax countries in what Secretary Yellen has described repeatedly as “a race to the bottom” in corporate tax competition. In other words, the United States wants to raise corporate taxes but wants to try to prevent its companies from leaving and avoiding taxes. What do you think about that?

BAHNSEN: Well, first of all, let’s just talk about the principles of our country and the notion that tax policies would ever be remotely set around global coordination. I generally don’t use the word globalism or globalist very much because I think it’s really misused and overused. Globalization factors in a lot of economic expansion realities in a more internationalist economy. Globalism, I think is generally more used in a sort of paranoid and conspiratorial way.

And yet, in this case, this is about as great of a way for them to feed the paranoids as possible, the idea that Janet Yellen would say that our country’s global tax policy should be a part of a coordinated effort with other countries is so anti American and anti the traditions of our country that I am speechless.

It isn’t going to go anywhere and any countries that end up agreeing to something, and then the day it goes against their best interest, they’re going to do exactly what they should do, which is just reverse course, unless they’re talking about a treaty, the only thing that’s gonna be binding as a treaty.  So it’s total politics. It’s, it’s and I don’t even think it’s good politics for them. Why would Janet Yellen and Joe Biden want that middle America Rust Belt state, working class part of the country to again, get ammo that suggests they’re going globalist, and all this type of stuff, feeding the kind of the things that President Trump used effectively when he ran successfully against Hillary Clinton. So I think it’s insane politics, I think is even more insane economics. And it’s not going anywhere, unless they just do some kind of toothless press release. But really, this is going to have to be done as a treaty if it’s going to go anywhere.

EICHER: Financial analyst and adviser David Bahnsen. He writes daily at DividendCafe.com. It’s easy there to sign up for his daily email if you’re interested. David, thanks! Talk again soon.

BAHNSEN: Thanks so much, Nick.

(Jay Reeves/Associated Press) In this Tuesday, Feb. 9, 2021, file photo, Michael Foster of the Retail, Wholesale and Department Store Union holds a sign outside an Amazon facility where labor is trying to organize workers in Bessemer, Ala.

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