Corporate gravy train is railroading rest of the country

Posted: Apr 12, 2006 12:01 AM

Most of the big public policy debates in Washington these days somehow involve homeland security. It animated the controversial ports deal, for example, and it underscores the battle over illegal immigration.

And that's as it should be. As I write in my book, Getting America Right, national security is the federal government's most important obligation. What could be more critical than that? Judging from the government's spending pattern, we have an answer: corporate welfare.

Last year, Washington spent $53 billion on homeland security -- and $60 billion on corporate welfare. Clearly our priorities are misplaced, and it's time to change that.

Corporate welfare comes in many flavors. The biggest such program -- farm subsidies -- is disguised as a measure to help "the little guy." The 2002 farm bill (misleadingly sold to Americans as the "Farm Security Act") will cost taxpayers $180 billion over 10 years. But little of that money actually goes to the traditional family farmer.

Two-thirds of farm subsidies go to the top 10 percent of subsidy recipients. That means tens of millions of dollars for big agribusinesses and millions more for such "gentlemen farmers" as basketball star Scottie Pippen, newscaster Sam Donaldson and television mogul Ted Turner.

At least 12 Fortune 500 companies also have pocketed farm subsidies in recent years, including John Hancock and Caterpillar. In addition, federal money funds critical programs such as barn restoration and paying farmers not to grow certain crops.

Even when farm subsidies actually do go to family farms, the money is often superfluous. The typical farm household reports a net worth of more than $500,000 and probably doesn't need much help from Uncle Sam. Besides, if Congress really wanted to guarantee every farmer a set income, say $35,000 a year, it could do so for "only" $4 billion. Instead, it spends far more than that, with most of that simply wasteful corporate welfare.

Another place Washington could trim the welfare spending is the "Advanced Technology Program."

Congress created this program in the 1980s to supposedly "bridge the gap between the research lab and the marketplace." In a country known for its innovations (the BlackBerry and the iPod, to name just two recent examples), it's not clear why the government should be involved in this process. After all, when a company does research, it generally plans to bring the product it develops to market. That's the sole reason private companies spend $150 billion each year on R & D.

Still, the program lives on, handing out more than $150 million per year to companies including IBM, General Electric, General Motors, 3M and Motorola. And while that seems like a small amount when compared with the billions Washington squanders elsewhere (the federal government can't account for $24.5 billion it spent last year -- it knows the money was spent, but doesn't know where it went or what it bought), killing this program would be a start.

Lawmakers could then move on to eliminate cotton subsidies ($264 million in 2004), peanut subsidies ($213 million in 2004), dairy subsidies ($206 million in 2004), sugar beet subsidies ($48 million in 2003), and all the rest. Then we'd be well on our way to eliminating corporate welfare.

Before they decide to spend any money, lawmakers should ask themselves whether the program they intend to spend it on would make us safer.

Remember: Every dollar wasted on corporate welfare is a dollar unavailable to protect our ports and secure our borders. It's bad enough to tolerate such subsidies in peacetime, but in a time of war it's positively immoral. Let's make sure our elected representatives know that as they decide which projects to pay for in the future.