Cut Corporate Welfare, Not the Safety Net
In Congress’ latest “fiscal cliff” deal that supposedly had to be passed in order to avoid economic calamity, we spent $30 billion on extending unemployment benefits for a year, and $205 billion in corporate tax breaks, subsidies and excessive tax loopholes. Most of these Christmas gifts for corporate America are benefiting major, multi-billion dollar corporations that haven’t paid a dime of US income taxes in years, like GE and Boeing. In other words, taxpayers spent 6 times more on giving free money to companies making record profits than we did to making sure the people who were laid off by these corporations can still feed their families. $205 billion in corporate goodies was okay with Speaker Boehner, but $60 billion in Hurricane Sandy relief apparently wasn’t.
One of the most egregious giveaways included in the New Years Eve fiscal cliff deal negotiated between Joe Biden and Mitch McConnell is an extension of a loophole that allows corporations to book US profits in overseas, tax-free bank accounts. Today, US companies have up to $2 trillion offshored thanks to loopholes like the one in this deal, at the same time Congress is talking about raising the Medicare eligibility age to avoid a fiscal meltdown. Instead of making us give up the pensions and healthcare that we paid for, why not hold rich companies to the same standards as everyone else when it comes to paying taxes?
The dominant topic in the news media for the next few weeks will be raising the debt ceiling. But what likely won’t be talked about is the fact that our debt can be easily taken care of by lowering unemployment. The whole reason the economy is in the tank is because of less demand due to more people spending less money. When more people are working, more people are spending money at local businesses, who will then hire more workers to meet demand, meaning less government money is spent on sending unemployment checks, meaning less debt. It's basic math.
During FDR’s administration, the economy was recovering until the neoliberal economists in his White House convinced him that cutting spending and lowering the deficit was a bigger priority than creating jobs, which then led to the recession of 1937-1938. The economic recovery was at its peak when FDR cut the unemployment rate in half largely through the efforts of the Works Progress Administration from 1935-1943, which provided jobs aimed at revitalizing infrastructure, parks and communities. Adjusted for inflation, the WPA would cost roughly $1.5 trillion today. That seems like a large figure, but we could fund that by simply levying a small sales tax on all Wall Street trading of stocks, bonds, options and futures-- just like ordinary Americans pay when purchasing goods and services. Such a financial transaction tax would generate $150 billion a year, or $1.5 trillion in ten years. Not only would such a program lower the unemployment rate, but the resulting economic boom would largely benefit the 99% of Americans that the latest jobless “recovery” of the last few years left behind.
You can count on the corporate-owned media to make the debate into whether or not we have to give up on Social Security or Medicare, instead of talking about the egregious billions that we’re throwing at America’s richest corporations, or the high volume of tax-free trading done that really only benefits the top 1% of the top 1%. That’s why we have to do everything we can to change the conversation between now and the end of January. The best way to do this is with creative, direct action.
Since the 113th Congress is being sworn in this month, and President Obama’s inauguration is set for the 21st, we should organize nationwide actions dubbed as the “Crowning of America’s Corporate Welfare Kings.” Over the next several weeks, activists can don royal garb, roll out the red carpet and get members of the House and on record saying that they will support ending corporate welfare and implementing a financial transaction tax rather than ask us to give up Social Security and Medicare benefits. And if they don’t agree to it, we’ll know that they side with Wall Street over their own constituents, and make a pledge to vote them out of office in the next election cycle. An action could even be as simple as pointing a cell phone camera at a member of Congress and asking them to take a position on the record.
We don’t have to make the same mistake of letting the politicians and the media set the tone for debate like we did in the last debt ceiling debacle. This time, we’ll come loud and strong and let them know we’re paying attention. And once we set the tone, we win.