On one hand, share repurchases can be an appropriate use of cash if surplus capacity exists and firms lack productive capital investment opportunities. On the other hand, additional profits from tax reform could also be allocated to employees through higher compensation. Wage growth appears to be a key issue for Democrats as we approach the midterm elections. Further political pressure could weigh on the popularity of share repurchases in 2019.

That’s from a note out Friday evening from Goldman, and it underscores the ongoing tension regarding what corporations plan to do with their excess cash, some of which comes courtesy of Trump’s tax cuts.

It should go without saying that companies are going to allocate a disproportionate share to buybacks and dividends and anything else that enriches capital at the expense of labor. That’s how this game works and that’s how it will always work, regardless of what Republicans tell you. There was of course the obligatory dog and pony show earlier this year when Trump and the GOP touted one-time bonuses and free Ho Hos and Ding Dongs as “evidence” that the tax cuts were indeed all about the Middle Class and that trickle down works after all, despite all historical evidence to the contrary.

Now to be fair, it’s always nice to see working people getting a thousand dollars they didn’t expect to receive and for a lot of those folks, a thousand dollars is a big deal. But really, that just kind of underscores the Marie Antoinette-ish character of this whole thing: “Let them eat rounding errors on C-Suite paychecks.

Or better yet, let them eat Ho Hos and Ding Dongs. Recall this from a January Bloomberg piece:

Hostess Brands Inc., feeling flush after last month’s tax overhaul, will offer bonuses to workers — including [a year’s worth of] free snacks.

The company, which makes Twinkies, Ding Dongs and Ho Hos, is providing its employees one-time payments of $1,250 — with $750 in cash and $500 in the form of a 401(k) contribution. In taking the step, Hostess cited last month’s tax legislation, which slashed the rate for U.S. corporations.

They won’t be able to eat all the Ding Dongs they like.

A representative from each of Hostess’s bakeries will choose a product each week, and the employees will be able to take home a multipack of that item.

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