Monday, January 20, 2014

Where's the Outrage?

A Guest Column

            Steve Baggarly of the Norfolk, VA, Catholic Worker brought the following article to my attention. I reproduce it here because it so concisely presents in clear layman’s terms the enormity of the financial injustice plaguing our country and our world. It’s in light of these abuses that we must see how corrupt a monster the American capitalist economy has become when politicians put their corporate allies on the public dole while denying basic services to the general population where need is ever-increasing.
            What could they be thinking? Are they thinking at all? Read and decide for yourself. But for my part, I’d rather be a citizen than a consumer. I’d rather live in a country that values and nurtures its people’s creativity and talents rather than limiting access to the chosen few for whom it seems no amount of wealth can ever be enough.
            “Simplify, simplify, simplify!” Henry David Thoreau cried out to his readers in Walden. Austerity hawks seem to think that should start with the poor. But I doubt that’s what Thoreau meant, nor what anyone would mean who’s guided by even a rudimentary moral compass.
            But enough from me, read the article. The author, Bill Quigley, is a law professor and Director of the Law Clinic and the Gillis Long Poverty Law Center at Loyola University in New Orleans and is also Associate Legal Director at the Center for Constitutional Rights. The article originally appeared on the Huffington Post website on January 14, 2014.

Ten Examples of Welfare for Corporations and the Ultra-Rich

by Bill Quigley

There are thousands of tax breaks and subsidies for the rich and corporations provided by federal, state and local governments, but these 10 will give a taste.
1. State and local subsidies to corporations: An excellent New York Times study by Louise Story calculated that state and local government provide at least $80 billion in subsidies to corporations. Over 48 big corporations received over $100 million each. GM was the biggest, at a total of $1.7 billion extracted from 16 different states, but Shell, Ford and Chrysler all received over $1 billion each. Amazon, Microsoft, Prudential, Boeing and casino companies in Colorado and New Jersey received well over $200 million each.
2. Direct federal subsidies to corporations: The Cato Institute estimates that federal subsidies to corporations cost taxpayers almost $100 billion every year.
3. Federal tax breaks for corporations: The tax code gives corporations special tax breaks that have reduced what is supposed to be a 35-percent tax rate to an actual tax rate of 13 percent, saving these corporations an additional $200 billion annually, according to the US Government Accountability Office.
4. Federal tax breaks for wealthy hedge fund managers: Special tax breaks for hedge fund managers allow them to pay only a 15-percent rate while the people they earned the money for usually pay a 35-percent rate. This is the break where the multimillionaire manager pays less of a percentage in taxes than her secretary. The National Priorities Project estimates this costs taxpayers $83 billion annually, and 68 percent of those who receive this special tax break earn more than $462,500 per year (the top 1 percent of earners).
5. Subsidies to the fast food industry: Research by the University of Illinois and UC Berkeley documents that taxpayers pay about $243 billion each year in indirect subsidies to the fast food industry because they pay wages so low that taxpayers must put up $243 billion to pay for public benefits for their workers.
6. Mortgage deduction: The home mortgage deduction, which costs taxpayers $70 billion per year, is a huge subsidy to the real estate, banking and construction industries. The Center of Budget and Policy Priorities estimated that 77 percent of the benefit goes to homeowners with incomes over $100,000 per year.
7. The billions above do not even count the government bailout of Wall Street, while all parties have done their utmost to tell the public that they did not need it, that they paid it back or that it was a great investment. The Atlantic Monthly estimates that $7.6 trillion was made available by the Federal Reserve to banks, financial firms and investors. The Cato Institute estimates (using government figures) the final costs at $32 to $68 billion, not including the takeover of Fannie Mae and Freddie Mac, which alone cost more than $180 billion.
8. Each major piece of legislation contains new welfare for the rich and corporations. The Boston Globe analyzed the emergency tax legislation passed by Congress in early 2013 and found it contained 43 business and energy tax breaks, together worth $67 billion.
9. Huge corporations that engage in criminal or other wrongful activities protect their leaders from being prosecuted by paying huge fees or fines to the government. You and I would be prosecuted. These corporations protect their bosses by paying off the government. For example, Reuters reported that JPMorgan Chase, which made a preliminary $13-billion mortgage settlement with the US government, is allowed to write off a majority of the deal as tax deductible, saving the corporation $4 billion.
10. There are thousands of smaller special breaks for corporations and businesses out there. There is a special subsidy for corporate jets, which cost taxpayers $3 billion a year. The tax deduction for second homes costs $8 billion a year. Fifty billionaires received taxpayer-funded farm subsidies in the past 20 years.

If you want to look at the welfare for the rich and corporations, start with the federal Internal Revenue Code. That is the King James Bible of welfare for the rich and corporations. Special breaks in the tax code are the reason that there are thousands of lobbyists in the halls of Congress, hundreds of lobbyists around each state legislature and tens of thousands of tax lawyers all over the country.



0 Comments:

Post a Comment

Subscribe to Post Comments [Atom]

Links to this post:

Create a Link

<< Home