Letter to the Cecil Whig - Farm Subsidies/Corporate Welfare
14.JUL.2001
While I applaud your stand against corporate welfare ("Johnny Welfare" July 11), I feel that your attack on America's apple growers was misplaced. Although I have never eaten an apple from China, I do not mind paying a little more for apples from the US, given the choice. Not only am I doing my part to help the future viability of our country's agricultural system, I can find out if the apples were drenched in harmful pesticides if I choose. Such information would be difficult to get from China.
If you want to talk about corporate welfare, let us have a look at the big offenders. The petroleum and pipeline industry, through tax breaks and clever accounting, only paid 12.3% tax on their profits of $33 billion between 1996 and 1998 (officially, the federal corporate income tax is 35%). This information is from "Corporate Income Taxes in the 1990s" by the Institute on Taxation and Economic Policy.
According to the same source, many corporations pay less than zero taxes on their profits. For example, PepsiCo (makers of Pepsi) earned almost $1.6 billion and received $302 million from the US Treasury Department in 1998. MCI Worldcom's profit was $2.7 billion and the US gave them over $112 million.
Your comment that "politicians already cost everybody way too much" was right on target. All of this corporate welfare is possible because of tax breaks and loopholes in the corporate tax laws. The corporations lobbied for them, and both Democrats and Republicans helped put them in place.
While it is true that government aid for failing businesses goes against the free market theory, perhaps it makes sense in the case of sustaining our nation's ability to produce food. However, handouts for businesses that are quite profitable make no sense, and benefit no one but the corporations.
