The first step toward solving a problem is admitting you have a problem. Representative Paul Ryan (R–WI) and the House Budget Committee recently took that step with a report detailing the failure of scores of federal welfare programs.
But it’s time for a similar focus on a different type of welfare: corporate welfare. From subsidies to tariffs to mandates, the federal government hands out tens of billions to various corporations that know how to ask.
Boeing, for example, benefitted from some $12 billion in loans from the Export-Import Bank in 2012 alone. It may, or may not, be just a coincidence that the company’s employees and executives donated $200,000 to Barack Obama’s presidential campaign in 2008 and added $170,000 more to his re-election campaign in 2012.
Many other companies benefit from such taxpayer-subsidized loans.
Heritage’s Stephen Moore explains that the federal government has given $8.5 billion in such loans since 2000, with big companies such as ExxonMobil, Ford, and Chevron cashing the checks. Federal insurance programs paid out $10 billion more, with Wells Fargo and JPMorgan Chase on the receiving end.
The federal government also helps big farmers (most subsidies go to farms worth more than $2 million) with price supports and by blocking imports, which drives up prices for consumers and drives manufacturing jobs overseas.
See also: Candy Crushing Cronyism
The federal welfare state has grown out of control in recent decades. That’s a problem for individuals who’ve been ensnared in the federal safety net. But it’s a bigger problem for businesses. Instead of focusing on productive ways to earn money, they invest in lobbying efforts in an attempt to grab their slice of the federal pie.
This is an issue that ought to be able to unite politicians on the left and the right: Slashing corporate welfare would be a good way to reduce federal spending and encourage companies to invest in job creation instead of income redistribution.
