Received: from mail04.mail.aol.com (mail04.mail.aol.com [152.163.172.53]) by literacy.nifl.gov (8.6.8/940311.01ccg) with ESMTP id KAA12804 for <nifl-family@literacy.nifl.gov>; Fri, 29 Dec 1995 10:45:32 -0500
From: NCFLRGS@aol.com
Received: by mail04.mail.aol.com (8.6.12/8.6.12) id KAA03174 for nifl-family@literacy.nifl.gov; Fri, 29 Dec 1995 10:47:23 -0500
Date: Fri, 29 Dec 1995 10:47:23 -0500
Message-ID: <951229104723_101544394@mail04.mail.aol.com>
To: nifl-family@literacy.nifl.gov
Subject: Corporate Welfare
Status: O
X-Status:
Good Morning:
Here's a cross-posting from David Rosen and the NLA list...(RGS).
*************************************************
The editorial below appeared in yesterday's Boston Globe (and on-line at the
Boston Globe Web Site -- where one can now read the Globe on-line for free
-- for the time-being, at least.
Although concern about corporate welfare is not, strictly speaking,
a literacy issue, it is one that students may find interesting, an issue
that they may wish to express opinions on to their legislators. As you
will read, it is also bi-partisan.
It seems to me to be the kind of issue to get someone interested in civic
action. (If you are a teacher and decide to use this in your classroom,
let me know what your students' reactions are.)
David Rosen
DJRosen@world.std.com
NLA List Moderator
=======================================================================
`Other' welfare on the table
By Thomas Oliphant, Globe Staff, 12/24/95
WASHINGTON
When an agglomeration of corporate leaders bought two-page ads in major
newspapers last week to plead for an honestly balanced budget, they
left a large loophole in their case.
Fortunately, Sen. Edward M. Kennedy spotted it, drove a truck through
it and helped put a huge issue closer to the budget negotiating table
than it has ever been.
The issue, not specifically addressed by the business leaders, is
``corporate welfare'' - hundreds of billions of dollars that represent
direct subsidies or indirect tax breaks that benefit major businesses
and the rich every year.
In their ad, the bipartisan, budget-balancing businessmen insisted that
the politicians put ``everything'' on the table and then mentioned
``long-term entitlement programs'' (meaning Social Security benefits)
and ``the size and shape of any tax cuts.'' They did not, however,
mention any of the goodies they themselves get from the government.
``If you are truly interested in balancing the budget,'' Kennedy wrote
back, ``I hope you will agree that corporations should bear their fair
share of the cuts along with working Americans, senior citizens,
children and students.''
Contrary to right-wing myth, corporate welfare is not the exclusive
province of liberal rhetoric; quite the contrary.
At the top of Ronald Reagan's pyramid in the early 1980s, budget
director David Stockman used the concept all the time. He argued loudly
- and unsuccessfully - that attacking tax and spending subsidies that
benefit business and the wealthy was essential not only to balance the
budget but to do so in a manner designed ``to attack weak claims, not
weak clients.''
In his famous memoir, Stockman's view of the failed Reagan Revolution
was that its anti-statist, conservative core values ``required abruptly
severing the umbilical cords of dependency that ran from Washington to
every nook and cranny of the nation.''
But inside the Reagan administration, as well as in the then-Democratic
Congress, Stockman's initiatives were blocked by the mighty forces of
the privileged status quo. Even in the substantial tax reform of 1986
that brought lower and fewer tax rates in exchange for fewer deductions
and credits, the bulk of the corporate welfare system survived intact.
It consists of two parts: a huge array of specific tax breaks that will
leave more than $4 trillion through the year 2002 in private and
corporate hands that would otherwise be subject to income tax, and a
collection of even more specific subsidies worth at least $100 billion
annually that directly aid selected (usually politically
well-connected) industries.
At a time when huge savings are being demanded in Medicare and
Medicaid, you have to wonder why nearly $20 billion in special tax
breaks continue to flow just to the oil and gas business. At a time
when loans for college students may be subject to major new
restrictions, you have to wonder why more than $20 billion in benefits
go to advertisers via a special accounting rule. At a time when housing
programs are being gutted, you have to wonder why those who use the
nation's inland waterways don't pay the cost of operating and improving
these commercial routes.
Moreover, right-wingers who attack the earned-income tax credit for the
working poor will be hard-pressed to defend tax credits for companies
that move jobs to Puerto Rico.
In his letter, Kennedy noted that half the budget cuts in the
just-vetoed Republican plan would come from the bottom 20 percent of
American families by income, while just 9 percent would come from the
top 20 percent. The GOP's $245 billion tax cut is similarly skewed. By
contrast, just $16 billion in tax breaks were targeted, most coming in
a mean-spirited attack on a tax credit that finances low-income
housing.
Noting that the seven-year plan would cut 17 percent out of
non-defense, non-Social Security spending, Kennedy noted that a similar
slice out of tax breaks would save a whopping $680 billion. Just a
quarter of that would save $170 billion, more than enough to cushion
the impact on health care and other social programs.
That's not politically likely, but cutting corporate welfare by roughly
$50 billion is already in a Senate Democratic budget alternative. In
the House, Stockman's philosophical descendant, Budget Committee
chairman John Kasich of Ohio, is also a hawk on the subject. And after
months of indecision, President Clinton is coming around.
In the current mess, the case for any tax cuts is weak if balancing the
budget is the priority; but to the extent there are any, they should be
financed fairly through corporate welfare reform, not cuts in social
programs.
At any rate, an issue long dormant is so no more. For that, we have
some self-interested forgetfulness by the business community and Sen.
Kennedy's sharp eyes to thank.
This story ran on page 67 of the Boston Globe on 12/24/95.
-------------------------------------------------
This archive was generated by hypermail 2b29 : Tue Jan 11 2000 - 13:20:18 EST