June-July 97

CORPORATE WELFARE

by Paul Cienfuegos

Most federal welfare spending goes to the rich, not the poor. In 1994, the amount of money allocated for Aid to Families with Dependent Children (AFDC), the program that is popularly known as "welfare," was about $23 billion-less than 2% of the entire budget. An additional $50 billion was spent on low-income assistance such as school lunches and food stamps. (Since President Clinton's welfare reform bill, poor Americans are receiving even less.) In contrast, the federal government handed out over $200 billion to giant corporations last year in price supports, export subsidies, export promotions, subsidized insurance rates, new plants and equipment, marketing services, and irrigation and reclamation programs. Additional billions were spent on loan guarantees and debt-forgiveness, including the erasure of most of the mega-billion-dollar debt owed by the nuclear industry for uranium enrichment services provided by the government.

"Welfare for the rich is the name of the game," says Michael Parenti, a leading author and critic of domestic government policies. Here's just a small sampling of how your tax dollars are being spent annually:

·$7.6 billion for grants, financing and tax breaks to US arms exporting corporations (warfare welfare);

·$32 billion to corporations permitted to write off the value of their equipment (depreciation) faster than it actually wears out;

·$40 million in subsidies to millionaire ranchers using public lands to graze their herds (like ABC news anchor Sam Donaldson who leases 2,360 acres of state trust land in NM for $1.25 per acre per year);

·$200 million to mineral mining corporations that pay peanuts for the leasing of public lands;

·$69.4 million to the Market Access Program (MAP) which subsidizes advertising by exporters of food and wine (like McDonalds, M&M, Sunkist, Dole, Ocean Spray, etc.);

·$660 million to build forest roads on public lands for corporate use-not including the environmental cost in terms of lost recreational opportunities, commercial fisheries and drinking water supplies, as well as the enormous social costs of restoring damaged forests and streams;

·$1 billion in "restructuring costs" (payoffs for layoffs) related to the merger of Boeing and McDonnell Douglas; in addition, Boeing paid $0 taxes in 1995 (not an unusual event) and received a $33 million rebate via the Foreign Sales Corporate Tax Credit and hefty deductions for R&D costs;

·$40 million to Westinghouse and GE to finance just their application (!) for a nuclear power license;

·$5.8 billion in tax-supported free research to private industry--called CRADAs (cooperative research and development agreements), like $733,000 to Disney Corp to design a semiconductor for igniting fireworks displays;

·$56.2 million to the Overseas Private Investment Corp (OPIC) which provides loans, loan guarantees, and political risk insurance to U.S. corporations which invest in risky countries (the job-killers subsidy);

·$700 million to fund the General Agreements to Borrow (GAB), which is part of the International Monetary Fund;

·$800 million for hundreds of unnecessary highway demonstration projects across the U.S. that members of Congress have requested;

·$6.7 billion on the mortgage interest deduction (mansion subsidy);

$5.5 billion for the business deduction for sports, 2-martini lunches and entertainment expenses;

·$22 billion for 100% current tax deductions for corporate advertising to US citizens;

·$3 billion for subsidized irrigation water;

·$3 billion that gives up to $10,000 to corporations for each welfare mother they hire at minimum wage (first to sign up were Monsanto, Sprint, United Airlines, UPS and ATT);

·and if they can get away with it this year: $78 billion in added bank profits if the government allows three days to clear your deposits through the system instead of the two-day current legal maximum.

Corporate welfare handouts are so out of control that even conservative organizations are getting involved. Recently, a broad range of taxpayer, consumer, free market and environmental groups formed the Stop Corporate Welfare (SCW) coalition which plans to target hundreds of millions of dollars in Federal spending over the next year.

Of course, not everyone is concerned. California Governor Pete Wilson, a devoted corporate worshipper, is supporting the move to cut off Social Security benefits to hundreds of thousands of non-citizen residents, many elderly. And how does he plan to use the anticipated savings? He wants to cut the Corporate Tax Rate by 10%!

In 1945, corporations paid 50% of all tax revenues. Last year, they paid 7%. Since 1973, the average rate of corporate profit has risen over 50%. Between 1983 and 1992, US-based corporations created 345,000 jobs abroad while cutting 783,000 jobs at home. Of the 100 largest economies in the world, 51 are corporations and 49 are nations. Corporations have become so powerful that they control virtually every economic policy decision made by governments. This is why they now pay virtually no tax, leaving mostly middle and low-income citizens to cover the tax bill. So the next time you read in your daily corporate newspaper that your town or county or state or country can no longer afford to keep its library's doors open, or house its homeless, or provide public transportation at an affordable price, remember that your community is as wealthy as it ever was, but the rich and powerful no longer pay their share. (Of course, your corporate daily is probably among the tax evaders, so don't expect adequate coverage of this story from them. You may have to research and write the story yourself!)

Let's work together to eliminate AFDC-Aid for Dependent Corporations!

Here's how you can get involved:

· Join the effort to eliminate corporate welfare. Lots of organizations are doing good work. Take your pick: *Women's International League for Peace and Freedom, 215-563-7110 or wilpfnatl@igc.org (Corporate Wealthfare posters) *Share the Wealth, 37 Temple Place, Boston MA 02111 (Wealthfare Reform Organizing Kit) *Corporate Welfare Project, POB 19405, Washington DC 20036 (Aid For Dependent Corporations Report) *Western Ancient Forest Campaign, 202-789-2844 or wafcdc@igc.org *Stop Corporate Welfare Coalition, c/o Public Citizen, 202-588-1000 or gene@citizen.org *Campaign for New Priorities, 202-544-8222 *Common Cause, 2030 M St, Washington DC 20036 *US PIRG's, 202-546-9707

· Educate yourself. *Read a good independent (non-corporate) newspaper or magazine (The Nation, Z, The Progressive, In These Times, Multinational Monitor, Counterpunch, Earth Island Journal, North Coast Xpress, Rachel's Weekly, and The Progressive Populist). If you'd rather read the computer screen, try Corporation Watch at www.corpwatch.org.

Relevant book titles include: Democracy for the Few by Michael Parenti, Who Will Tell the People: The Betrayal of American Democracy by William Greider, The Case Against the Global Economy edited by Jerry Mander and Edward Goldsmith, and When Corporations Rule the World by David Korten.

Democracy Unlimited is a grassroots effort bringing concerned citizens together from a broad spectrum of backgrounds. We come together to reclaim citizens' historic authority to define and govern the formation and operation of the corporation. We lead "Rethinking the Corporation" workshops and discussions, publish a newsletter, and educate, organize, agitate and strategize. Please join us! Phone (707) 822-2242, Fax: (707) 822-3481, E-mail: cienfuegos@igc.org

Paul Cienfuegos has founded and directed organizations, edited an independent newspaper, and worked for Ancient Forest protection, Native Sovereignty, Nuclear Disarmament, Ecological Restoration and Dismantling Corporate Power.

WHY DO CORPORATIONS HAVE MORE RIGHTS THAN YOU?

Our ancestors never intended for them to dominate our society and overwhelm our democracy. Are you ready to join a fast-growing new movement to dismantle corporate power? Send $5 or more for introductory packet: Paul Cienfuegos, Democracy Unlimited, P. O. Box 27, Arcata CA 95518

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