Reuters, How Corporate Socialism Destroys, by David Cay Johnston:
A proposal to spend $250 million of taxpayer money on a retail project here illustrates the damage state and local subsidies do by taking from the many to benefit the already rich few.
Nationwide state and local subsidies for corporations totaled more than $70 billion in 2010, as calculated by Professor Kenneth Thomas of the University of Missouri-St. Louis
In a country of 311 million, that’s $900 taken on average from each family of four in 2010. There are no official figures, but this one is likely conservative because — as documented by Thomas, this column and Good Jobs First, a nonprofit taxpayer watchdog organization funded by Ford, Surdna and other major foundations — these upward redistributions of wealth keep increasing.
In Irondequoit, just outside Rochester, N.Y., and a few miles from where I live, developer Scott Congel wants $250 million in sales taxes to finance rebuilding the Medley Centre mall while adding condominiums and a hotel. Typically local governments issue bonds, which are paid off using sales tax receipts that are diverted from public purposes to the developer’s benefit.
Subsidies for retail businesses are the worst kind of corporate welfare because, as the end of the economic chain, retailing grows only when population and incomes increase. If population or income falls, then subsidies for new projects like Congel’s damage existing businesses, where people would otherwise be spending their money. …
That’s how corporate socialism works – taxpayers contribute when the market rejects. …
That’s how corporate socialism works — taxpayers donate capital, while the owners keep the profits. …
That’s how corporate socialism works — ignore inconvenient facts. …
That’s how corporate socialism works — government, not the market, picks winners and losers. …
That’s how corporate socialism works — ignore inconvenient laws. …
That’s how corporate socialism works — divert money from schools and other public services to company coffers. …
That’s how corporate socialism works — penalize anyone with the temerity to fight being taxed to give to the already rich. …
That’s how corporate socialism works — privatize gains, socialize losses and destroy competitors who do not get subsidies.
