The evil of stock buybacks: How corporations became ATMs for the superwealthy

Corporations are no longer engines for shared prosperity and growth

Stock buybacks
(Image credit: (Corbis))

To appreciate the rot at the heart of corporate America, look no further than stock buybacks.

Otherwise known as repurchases, they're instances in which corporations use their profits to buy back their own stocks, resulting in a big payout for shareholders. Prior to 1980, they were a minor occurrence. Since then, buybacks have become a massive phenomena; from 2003 to 2012, the 449 publicly listed companies on the S&P 500 devoted $2.4 trillion — a whopping 54 percent of their earnings — to buybacks.

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Jeff Spross

Jeff Spross was the economics and business correspondent at TheWeek.com. He was previously a reporter at ThinkProgress.