State and local governments have awarded at least $110 billion in
taxpayer subsidies to business, with 3 of every 4 dollars going to fewer
than 1,000 big corporations, the most thorough analysis to date of
corporate welfare revealed today.
Boeing ranks first, with 137 subsidies totaling $13.2 billion, followed
by Alcoa at $5.6 billion, Intel at $3.9 billion, General Motors at $3.5
billion and Ford Motor at $2.5 billion, the new report by the nonprofit
research organization Good Jobs First shows.
Dow Chemical had the most subsidies, 410 totaling $1.4 billion, followed
by Warren Buffett’s Berkshire-Hathaway holding company, with 310 valued
at $1.1 billion.
The figures were compiled from disclosures made by state and local
government agencies that subsidize companies in all sorts of ways,
including cash giveaways, building and land transfers, tax abatements
and steep discounts on electric and water bills.
Meanwhile, families in poverty are having trouble getting by -- because
government supposedly can't afford to pay for things like food stamps or
the Temporary Assistance for Needy Families (TANF) program. Welfare reform was supposed to lift people out of poverty, but it's done the opposite. And it was all predictable.
After Clinton signed welfare reform into law, families were basically
given one chance to get out of poverty, then they'd be trapped there for
life. You had a lifetime cap on welfare payments, then you were on your
own. After Clinton signed the bill into law, payday loan shark
businesses sprouted up like mushrooms all over the nation. These
businesses prey on people in need, trapping them in a debt cycle with
incredible interest rates and eliminating any hope of ever being able to
escape poverty. According to ThinkProgress, the number of families in poverty who missed out on welfare benefits was 28%. Today, it's 74%.
As programs to eliminate poverty go, TANF -- the program that replaced Aid to Families with Dependent Children (AFDC
or "welfare as we know it") -- blows. It does exactly the opposite of
what was promised. When a handful of people have to switch from crappy
health coverage, that law needs to be scrapped. When a law that was
supposed to reduce poverty instead has families paying loans with
massive interest rates just to stay in a flea bag apartment in the worst
side of town, that law is somehow inviolate. In fact, there's no
shortage of Republicans who'll tell you it has to be made even worse.
But where is money being thrown away here. If Warren Buffet stops
getting a tax credit for merely existing, if the Koch brothers get cut
off from oil subsidies, if Wall Street has to pay higher taxes, are they
going to go broke. Will we see JPMorgan CEO Jamie Dimon living out of a pay-by-the-week motel room, rolling a 40% interest payment over and over just to make the rent?
I doubt it. Yet they're the ones getting all the welfare. Worse, we
don't even pretend that the handouts we give Wall Street are designed to
get the super-rich's snouts out of the government troughs. Whereas
welfare for people in poverty is supposed to get people off welfare,
handouts for the rich keep coming, no questions asked. Need a tax break
to build your new office complex or hotel? Sure! We don't even need to
check and see if you need the money. Which is good, because it's 100%
guaranteed that you don't.
And here's the thing. No one in government actually keeps track of how
much we spend total in corporate welfare. In order to find out, you have
to do an in-depth study. "The best estimate of total state and local
subsidies comes from Professor Kenneth Thomas, a political scientist at
the University of Missouri at St. Louis. In 2010 he calculated
the annual cost at $70 billion. No serious challenge has been made to
this conservatively calculated figure, which in 2014 dollars comes to
$75 billion. That is about $240 per person — nearly $1,000 annually for a
family of four," Aljazeera reports. "That amounts to more than a week’s take-home pay for a median-income family with two parents and two children."
That's a massive transfer of wealth from the 99% to the 1%. A huge heist
that goes on every day, unreported and untracked. "Class warfare" is
actually underselling it. We've created an American aristocracy.
A grand a family and what do we have to show for it? Income inequality
at historic levels. All this corporate welfare doesn't seem to be doing
lot, other giving wealthy money-hoarders more money to hoard. At this
point, raising the minimum wage would be justified even if the economy
was going gangbusters -- just as a way to force these platinum-plated
welfare queens to pay a few of the taxpayers back. At least them we'd
get something back from this massive raid on taxpayers'
pocketbooks. We need to do much. much more to level the playing field
and actually get people out of poverty, but raising the minimum wage
would be a good start and the very least we can do. Those wages will be
spent, benefiting everyone.
We've got our welfare policy bass-ackwards
and wrong. Unless we turn it completely around, things are never going
to get any better. Raising the minimum wage is a step toward reversing a
transfer of wealth that's moving in entirely the wrong direction.
[photo via The All-Nite Images]