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  The Society for Consumer Advocates and Mavens

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CORPORATE WELFARE AND MERGERS

Thomas Jefferson, the father of American democracy, cautioned the citizenry about the excesses of monied interests controlling government. Today, our legislators are corrupted by corporate cash. The "bad guys" are not the corporate lobbyists but it is the politicians who pander the lobbyists by accepting lavish special favors and cash while hard working voters get "railroaded" into believing the politicians are the "good guys" working for the voters.

Meanwhile, corporate subsidies, tax breaks, bailouts, sweetheart government contracts and giveaways of public property to monied interests are growing, thanks to legislators in Congress. Corporate welfare is bankrolled by politicians who are indebted to the monied special interests.

For example, when loggers cut down 100 year old trees on U.S.public lands in national preserves, taxpayer dollars are used as giveaways to build the roads leading in and out of the logging areas, and the trees are being bought for pennies! Congress does the same for mining companies and other industrial poachers of U.S. public lands and parks. These giveaways of the public's resources should be illegal but are not!

Furthermore, Congress also pays billions of taxpayer dollars to major, multi-billion dollar corporations just to help them promote and advertise American-made products and services overseas. The problem is these corporations would or could do these promotions on their own, so why should American taxpayers have to subsidize and pay for it?

Additionally, Congress also hands out millions of taxpayer dollars every year in research subsidies to America's richest corporations supposedly to help make America stronger and more competitive. However, as usual, with federal grant programs it does not always work out quite the way it was supposed to. In return for government sponsored, corporate welfare "handouts", the promise to government by corporations is that they will , in turn, create high-tech, highly skilled jobs in the U.S., yet the whole process has actuallly turned into costly federal programs or "giveaways", exploding way beyond the government's ability to monitor them! The concept flaw is that a federally planned economy combined with the free market system is practically unworkable!

Consequently, the corporations being subsidized by taxpayer dollars are cutting jobs, NOT creating them! The U.S. taxpayers actually end up subsidizing industries that are slowly but surely shifting jobs offshore out of the country!

Meanwhile, the U.S. government does not even bother to carefully examine, in any great detail, the subsidy arrangements between government and corporations to see how much money, if any, the corporations are contributing, as agreed, even though the government swears the corporations are sharing the cost!

So, how does the government verify the accuracy of corporate subsidy contributions? It does not! The so-called federal watchdogs rarely, if ever, bark!

Concerning mergers, the U.S. government uses taxpayer dollars to subsidize industries, like defense manufacturers, enabling two competing companies to merge their companies supposedly to save tax dollars by eliminating wasted space and duplicated manpower. However, the problem is taxpayers may save even more money if the government did not subsidize or pay the costs necessary to help competitors merge. Critics charge that this subsidy expense is corpor;ate welfare at its worst!

What the taxpayers do not know is these companies may merge anyway to save money so why do U.S. taxpayers have to pay the costs? Taxpayers pay because politicians "pull strings" to get their states' industries all the federal money possible.

SUPPLEMENTAL SOURCES: CBS-TV 60 MINUTES 12/22/96 and MIAMI HERALD NEWSPAPER 6/4/95

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