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What is Libertarian Socialism?
The case against Patriotism

Noam Chomsky
The American corporate welfare state
Dismantling the Military
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On Capitalism:

"There were rising standards of living
under slavery. Slaves were better off in the 19th century than in
the 18th century. Is that an argument for
slavery? The same argument can be made for Stalinism. There
was a tremendous rise
in economic growth. Does this justify Stalinism?"

Noam Chomsky


 






 

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What is the American Corporate Welfare State?
June 4th| Nick

An oft repeated phrase by republicans is that, "America is sinking into the depths of a welfare state" What they fail to realize is that America has been in a welfare state since at least the 1800's with the advent of the railroad barons, even though the amount of welfare paid today would have been unimaginable in previous times. Do not confuse this with welfare for the poor, that only made up a meager 1% of spending in the budget even during its hayday, the American military spends over 50% of the Federal Budget. The aforementioned welfare would be considered welfare for the rich. The basic function of the US government these past 50 years has been to serve corporate interests, that are fundamentally exploitative. Every year around 100 billion dollars in given directly to US businesses.(cato.org 1997 estimates) With the Bush tax cut proposal over 150 billion dollars will go directly to industry. In this table we can see how the funds have been distributed before,
Company 1990-94 Technology: Left Subsidies |Right 1994 Profits

Amoco $23,600,000 | $1,800,000,000
AT&T $35,600,000 | $4,700,000,000
Citicorp $9,600,000 | $3,400 ,000,000
DuPont $15,200,000 | $2,700,000,000
General Electric $25,400,000 | $4,600,000,000
General Motors $110,600,000 | $4,900,000,000
IBM $58,000,000 | $3,000,000,000
Motorola $15,100,000 | $1,600,000,000

Source: Philadelphia Inquirer, "How Billions in Tax Cuts Failed to Create Jobs," June 4, 1995.

"Corporate welfare is a large and growing component of the federal budget. America's most costly welfare recipients today are Fortune 500 companies. In 1997 the Fortune 500 corporations recorded best-ever earnings of $325 billion, yet incredibly Uncle Sam doled out nearly $75 billion in taxpayer subsidies."- Cato Institute. Enron alone before its collapse was privy to $7.219 billion dollars of public funds!(Institute for Policy Studies)

In the Fortune top 100 transnational corporations all 100 had benefit from corporate welfare policies and 20 were saved from total collapse. This is the way our economy works, the public take the risk and losses while only the upper echelons of corporations see the profits.

Take a look at any of the dynamic industries, aeronautics, fiber optics, computers, and the internet. All were reasearched with public funds then handed over to be exploited for profit to private power. Even railroads were paid for by the US government throughout the 1800's then handed over to private power. Is this a government you want to be proud of?

Bush's Defense department has mismanaged over 1 trillion dollars for corporate contracting(subsidy) (5/15/03 CNN). His current Defense department plan calls for 486 Billion dollars (5/12/03 CNN). An example of the massive amount of corporate welfare is the 63 Billion dollars allotted to pay Boeing for an unneeded 341 F-22 aircraft. Another example is the Navy contracting the construction of 30 Virginia Class submarines at a price tag of 65.3 Billion dollars. Note nearly every expenditure the military makes it gives money for private contractors as profits. A huge percentage of the military budgeting goes directly to profits for the corporations. While Bush can find 485 Billion for his corporate contractors Bush can't find the 7 Billion dollars to provide clean water to the world. This has been the standard procedure since World War II and the the beginning of the Cold War. The ultimate capitalist good is weaponry, it is the only product that constantly obsoletes, and is constantly used by the largest customer in the world, the US government.

The very definition of Corporate welfare is the game corporations play with the states and transnationals play with countries. A perfect example of this just occured with Boeing in our backyard. Boeing doesn't feel the need to pay any taxes since it already provides the US with a "defense" against whoever the evil person ordained by the president is that year, so when Seattle decided that it needed more revenue to pay for public housing and to tax Beoing, Boeing packed its bags and left. Where did it goto? It went here to Chicago, where Mayor Dailey paid Boeing a company that makes 51.1 Billion dollars in profit, 64 million dollars from the public housing budget to set up their corporate headquarters here. The lesson here was when corporations are forced to do something they don't want to, they move and basically destroy the community they left.

Want more proof? How about the unprecedented aircraft-leasing deal currently being put together by the Pentagon and Boeing -- a plan that uses the same kind of accounting sleight-of-hand popularized by the gang at Enron. Here's how it works: instead of the Pentagon buying the 100 new jets it wants to use as aerial refueling tankers directly from Boeing, at an upfront cost of $138 million per plane, a special-purpose entity created on Wall Street will purchase the planes and lease them to the Air Force.

That way the Pentagon gets to acquire the planes without having to dip into the Air Force's limited procurement budget, and Boeing gets to reap billions in new military contracts without having to show the debt associated with the shady deal on its balance sheet. It's an off- the-books win-win deal for them both -- but a losing proposition for taxpayers, who'll end up forking over an additional $8 billion to cover the interest payments on the leases.

The sleazy new deal is being put together by the good bankers at Citigroup -- the same outfit that helped Enron defraud shareholders out of, what do you know, also $8 billion. Who says irony is dead?







 

 

 





 

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