Washington, D.C. — Today, during a Senate Banking Committee hearing, U.S. Senator Joe Donnelly questioned Federal Reserve Chair Janet Yellen about corporate outsourcing to foreign countries and its intergenerational impact on families and hard-hit rural communities. He also questioned Yellen about how an excessive corporate focus on short-term profits harms working families, and ways to help create economic and educational opportunities for rural communities.
To see Donnelly’s questions to Federal Reserve Chair Yellen, click the image above or click here.
In his discussion on the dangers of the corporate focus on short-term profits harming workers Donnelly stated, “You were here at a time about a day or two after the Carrier layoffs and those layoffs in my home state brought to light a troubling pattern of corporate executives prioritizing immediate profits over the long-term health of companies. This short-term mindset, maybe due to the relentless pressure of activist investors or poorly constructed executive compensation goals, but has resulted in executives spending trillions to placate shareholders with stock buybacks and dividends. It has also occurred at the expense of workers, and communities, and long-term economic value creation. And new research finds that companies that focus on the long term by reinvesting in the company far outperform their short-term peers in economic and financial success.”
Yellen responded, in part, “I certainly agree with you that focusing on long-term investments that have significant payoffs for companies and for the economy is important to the health of companies and the economy.”
Donnelly also focused on jobs in rural communities, saying, “When a small town is devastated by job losses, as has happened to so many towns across this country, where you look up and one day you have a company making windshields for one of the Big 3 and the next day that windshield company is in Mexico, it impacts the future of that town, and it’s not just the jobs that dry up but the economic development, the revenue base, the secondary impact on other businesses: gas stations, restaurants, grocery stores. How does a small town succeed when it feels like so many of these economic currents have been against them for so long?”
Yellen responded, in part, “I think these are extremely difficult trends for towns to cope with and many towns in rural areas have been very badly affected by these developments.”
For years Donnelly has fought to protect American jobs. He recently stood alongside workers from Carrier, Rexnord, and UTEC who are losing their jobs to outsourcing and announced the End Outsourcing Act. Donnelly also raised the issue of outsourcing during his meeting with President Trump last week. More than 2,000 Hoosier workers around the state are losing their jobs to foreign countries from companies including, Carrier, Rexnord, UTEC, CTS Corporation in Elkhart, Manitowoc Beverage in Sellersburg, and TRW Automotive in Lafayette.