The Cato Institute estimated that in 2002, the US Budget devoted to corporate welfare COST TAXPAYERS ABOUT $93 BILLION. FOR 2002 ALONE.
This is about 5 percent of the federal budget.
- To clarify what is and isn’t corporate welfare, a “no-bid” Iraq contract for the prestigious Halliburton, would not be considered corporate welfare because the government technically directly receives some good or service in exchange for this expenditure.
- Based on the Pentagon’s Defense Contract Audit Agency (DCAA) findings of $1.4 billion of overcharging and fraud, I suppose the primary service they provide could be considered to be repeatedly violating the American taxpayer.
- On the other hand, the $15 billion in subsidies contained in the Energy Policy Act of 2005, to the oil, gas, and coal industries, would be considered corporate welfare because no goods or services are directly returned to the government in exchange for these expenditures.
Okay… so the minority crackheads with 10 kids
must be killing the budget, right?
Ronald Reagan set the tone by actually using the concept of ‘high rolling, drugged-up minority women’ who have as many kids as possible to ensure the highest ‘welfare benefit’ for their ‘care’.
President Reagan, unfortunately, had neither the facts nor reality on his side in citing a nominally-existent, uncommon and minor population as his rationale for virtually dismantling the entire social safety net in a fell-swoop or two. Here’s what he actually said at the time, so judge for yourself:
If we were mislead picturing welfare being wasted on a few lazy cracked-out, mostly-black jobless single mothers in the inner city (which we in fact were)…
WHAT IS THE TRUE FACE OF WELFARE FRAUD TODAY?
Wal-Mart. Always high subsidies. Always.
The government gives tons of favors to the largest corporations, increasing the significant advantage they already have over smaller competing businesses.
If, in the court of public opinion, Wal-Mart has been tried and convicted for the murder of main street, mom-and-pop America, then the government could easily be found guilty as a willing accomplice. Wal-Mart receives hundreds of millions of dollars of subsidization by local governments throughout the country.
These subsidies take the form of bribes by local politicians trying to convince Wal-Mart to come to their town with the dream of significant job creation. Of course, from that follows a larger tax base.
For example, a distribution center in Macclenny, Florida received $9 million in government subsidies in the form of free land, government-funded recruitment and training of employees, targeted tax breaks, and housing subsidies for employees allowing them to be paid significantly lower wages.
A study by Good Jobs First found that 244 Wal-Marts around the country had received over $1 billion in government favors.
Does it end with Wal-Mart?
Always more corporate welfare to name & shame, and this is where we do it:
The Big Picture
So now let’s look at the big picture. The final totals are $59 billion, 3 percent of the total federal budget, for regular welfare and $92 billion, 5 percent of the total federal budget, for corporations. So, the government spends roughly 50% more on corporate welfare than it does on these particular public assistance programs.
Should we spend less on corporate welfare and/or social welfare programs? Or should we spend even more? It’s up to you. A bunch of people died horrible deaths to make sure this country remained a democracy, so if you feel strongly about this issue you owe it to them to call or write your congressman and senators and give them a piece of your mind.
Some More Sources:
- 2013 Budget: http://www.whitehouse.gov/sites/default/files/omb/budget/fy2013/assets/budget.pdf
- Source: Office of Management and Budget, Budget of the United States Government (Washington: Government Publishing Office), various years; and data from the American Association for the Advancement of Science R&D Budget and Policy Program, various years.
- Source: U.S. Department of Agriculture, Economic Research Service, http://www.ers.usda.gov/data.
- Source: Export-Import Bank, 2006 Annual Report (Washington: Export-Import Bank, 2007).
- Source Data from Chris Edwards at Cato:
ALSO: JET Magazine took a investigative view of how the ‘welfare queen’ stereotype came into the popular culture. This video is a brief look at what they found: