JPMorgan Chase CEO Jamie Dimon told investors Thursday that the GOP tax cuts increased his bank’s profits by $3.7 billion last year.
In his annual letter to shareholders, Dimon said that JPMorgan Chase generated “record revenue and net income” in 2018 – and would have done so even without tax reform. The tax overhaul also contributed to profits the prior year. (See the chart below, with net income in blue.)
“The new tax code establishes a business tax rate that will make the United States competitive around the world and frees US companies to bring back profits earned overseas,” Dimon said. “The cumulative effect of capital retained and reinvested over many years in the United States will help cultivate strong businesses and ultimately create jobs and increase wages.”
Dimon said that the bank used some of its windfall “to massively increase our investments in technology, new branches and bankers, salaries (we now pay a minimum of $31,000 a year for full time entry-level jobs in the United States), philanthropy and lending (specifically in lower income neighborhoods).” In the long run, however, he expected “that some or eventually most of that increase will be erased as companies compete for customers on products, capabilities and prices.”
On a darker note, Dimon warned that while he sees capitalism as "the most successful economic system the world has ever seen," the American Dream is “fraying” for many citizens. He called for a “Marshall Plan for America” to address persistent policy failures in the U.S. on issues including education, health care, infrastructure and immigration, and argued that CEOs and businesses need to play a role in fixing the country’s problems.
Critics of the GOP tax cuts were quick to argue that the bank’s windfall was more of a problem than a triumph. Michael Lind of the progressive Hub Project tweeted, “Donald Trump, champion of working people, gave a tax cut worth $3.7 billion to one of the largest Wall Street banks in the country.” And in response to Dimon’s discussion of the economic struggles many Americans are experiencing, Sen. Elizabeth Warren wrote, “Great point, Jamie! How about we start with you giving back the $3.7 billion J.P. Morgan made this year off the #GOPTaxScam that you lobbied for?”