About $59 billion is spent on traditional social welfare programs. $92 billion is spent on corporate subsidies. So, the government spent 50% more on corporate welfare than it did on food stamps and housing assistance in 2006.
The Corporate Welfare Queen | Definition: Corporate Welfare
n. Financial aid, such as a subsidy, provided by a government to corporations or other businesses.
The Cato Institute estimated that, in 2002, $93 billion were devoted to corporate welfare. 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.
Tax breaks targeted to benefit specific corporations could also be considered a form of welfare. Tax loopholes force other businesses and individual taxpayers without the same political clout to pick up the slack and sacrifice a greater share of their hard-earned money to decrease the financial burden on these corporations. However, to simplify matters, we’ve only included financial handouts to companies in our working definition of corporate welfare.
Whenever corporate welfare is presented to voters, it always sounds like a pretty reasonable, well-intended idea. Politicians say that they’re stimulating the economy or helping struggling industries or creating jobs or funding important research. But when you steal money from the paychecks of working people, you hurt the economy by reducing their ability to buy the things they want or need. This decrease in demand damages other industries and puts people out of work.
Most of the pigs at the government trough are among the biggest companies in America, including the Big 3 automakers, Boeing, Archer Daniels Midland, and now-bankrupt Enron.
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It is not the poor who are “cheating” an inherently broken system—this is how capitalism works.