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Fortune 500 companies receive $63 billion in subsidies

phlatsphilphlatsphil Posts: 14,632 AG
Remember when President Obama was lambasted for saying “you didn’t build that”? Turns out he was right, at least when it comes to lots of stuff built by world’s wealthiest corporate behemoths. That’s the takeaway from a new study of 25,000 major taxpayer subsidy deals over the last two decades.

Entitled “Subsidizing the Corporate One Percent,” the report from the taxpayer watchdog group Good Jobs First shows that the largest corporations in the world aren’t models of self-sufficiency and unbridled capitalism. To the contrary, they continue to receive tens of billions of dollars in government handouts. Such subsidies might be a bit more defensible if they were being doled out in a way that promoted upstart entrepreneurial-ism. But as the study also shows, a full “three-quarters of all the economic development dollars awarded and disclosed by state and local governments have gone to just 965 large corporations” — not to the small businesses and start-ups that politicians so often pretend to care about.

The true beneficiaries of subsidies are often hidden under layers of holding companies, shell firms and complex ownership agreements. But Good Jobs First did the tedious work of connecting the subsidies to the parent firms. In the process, the group discovered that a whopping $110 billion — or 75 percent of cumulative disclosed subsidy dollars — are going to these 965 large companies. Fortune 500 firms alone receive more than 16,000 subsidies at a total cost of $63 billion. Additionally, eight out of the top 20 firms receiving U.S. taxpayer subsidies are not even U.S. companies, meaning American taxpayers are being forced to directly subsidize foreign firms.

These kind of handouts, of course, are the opposite of anything having to do with a “free market.” They are the definition of government intervention in the market. Yet, the free-market image of companies is rarely tarnished when those companies accept the huge welfare payments.

Consider Koch Industries. Despite the Koch Brothers being the biggest financiers of the anti-government right, and despite their billing as libertarian “free market” activists, their company has relied on $88 million worth of government subsidies.

Similarly, behold the big tech firms. They are often portrayed as self-made up-from-the-bootstraps success stories. Yet, as Good Jobs First shows, they are among the biggest recipients of the subsidies.

Intel, for instance, leads the tech pack with 58 subsidies worth $3.8 billion. Next up is IBM, which has received more than $1 billion in subsidies. Most of that is from New York – a state that is right now in the middle of a full-scale advertising campaign proudly promoting its handouts.

Then there’s Google’s $632 million and Yahoo’s $260 million, most of both companies’ subsidies derived from data center deals. Microsoft has pulled in $95 million primarily from Washington State’s tax handouts.

There is also Silver Lake Partners, which owns Dell and has by extension benefited from $482 million in corporate welfare payments.

And not to be forgotten is 38 Studios, the now bankrupt software firm that received $75 million in Rhode Island taxpayer cash at the very moment that state was cutting public workers’ pension benefits.

Along with propping up firms that are supposedly free-market icons, the subsidies are also flowing to financial firms that have become synonymous with never-ending bailouts and a perverse kind of corporate socialism. Indeed, firms like UBS, Goldman Sachs, Bank of America and Citigroup – each of which were given massive taxpayer subsidies during the financial crisis — all are the recipients of tens of millions of dollars in additional subsidies tracked by Good Jobs First.

All of these handouts, of course, would be derided as welfare if they were going to poor people. But because they are going to extremely wealthy politically connected conglomerates, they are typically promoted with cheery euphemisms like “incentives” or “economic development.” Those euphemisms persist even though so many of these subsidies do not end up actually creating jobs or generating a net gain in public revenues.

In light of that, the Good Jobs First report is a reality check on all the political rhetoric about dependency. Most of that rhetoric is punitively aimed at the poor. That’s because, unlike the huge corporations receiving all those subsidies, the poor don’t have armies of lobbyists and truckloads of campaign contributions that make sure programs like food stamps are shrouded in the anodyne argot of “incentives” and “development.”

But as the report proves, if we are going to have an honest conversation about dependency and “free markets,” then all the billions of dollars flowing to politically connected companies need to be part of the discussion.

http://pando.com/2014/02/26/fortune-500-companies-receive-63-billion-in-subsidies/
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Replies

  • FreeLinerFreeLiner Posts: 1,572 Captain
    Dont worry. Obama has a plan to reign in the 1%.

    Ps: underlining the Koch bros measly 88 million was comical.
  • gregglgreggl Posts: 21,594 Officer
    FreeLiner wrote: »
    Dont worry. Obama has a plan to reign in the 1%.

    Ps: underlining the Koch bros measly 88 million was comical.

    You're ok with this then?

    Obama has it covered?
  • FreeLinerFreeLiner Posts: 1,572 Captain
    greggl wrote: »
    Very cool link!!!!

    Boeing should give us all a free jet!
  • NewberryJeffNewberryJeff Posts: 7,447 Admiral
    Koch bros. anti-government? :rotflmao
  • FreeLinerFreeLiner Posts: 1,572 Captain
    greggl wrote: »
    You're ok with this then?

    Obama has it covered?

    Of course not.

    I was pointing out the obvious slam against the Koch bros. In reality they dont even make the top 100 offenders.

    Yet theyre on the list and underlined by the OP. If you picked a group of guys that would offend this I'd say duh to the Koch bros and "how ironic" to the uber liberal google abusing subsidies.
  • FreeLinerFreeLiner Posts: 1,572 Captain
    And as Obamas 2008 campaign website said.....he has nothing on the economy covered. Just social programs and roads.
  • gregglgreggl Posts: 21,594 Officer
    FreeLiner wrote: »
    Yet theyre on the list and underlined by the OP. If you picked a group of guys that would offend this I'd say duh to the Koch bros and "how ironic" to the uber liberal google abusing subsidies.

    The subsidies to the Kochs is almost identical to the dark money they are kicking in for political cache.

    Hey Freeliner, you have 106 posts. 3 in this thread.

    All three here are partisan drivel. What are the other 103 like?
  • gregglgreggl Posts: 21,594 Officer
    107 and 4 are drivel :)
  • FreeLinerFreeLiner Posts: 1,572 Captain
    Im fiscally very conservative. Socially very moderate.

    Ive been on the board for years with a differnt screen name. Just been off of here for a while.

    Simple fact is Obama has been and will continue to be a lame duck for our economy. Socially however he is doing great for standing up for those without a voice.....like his said he would on his 2008 website.
  • FreeLinerFreeLiner Posts: 1,572 Captain
    greggl wrote: »
    The subsidies to the Kochs is almost identical to the dark money they are kicking in for political cache.

    Hey Freeliner, you have 106 posts. 3 in this thread.

    All three here are partisan drivel. What are the other 103 like?

    Ok great?

    Now what has google spent its almost a billion on? Or Boeing's 13 bills?

    It all went to the goodwill of their fellow humans right?
  • gregglgreggl Posts: 21,594 Officer
    Im not defending corporate handouts to google OR the Kochs or movie studios or any of them.

    We need to de-worm corporate America and ween them off public graft.
  • FreeLinerFreeLiner Posts: 1,572 Captain
    greggl wrote: »
    Im not defending corporate handouts to google OR the Kochs or movie studios or any of them.

    We need to de-worm corporate America and ween them off public graft.
    Definitely agree.

    I didnt vote for Obama or Mitt. As far as im concerned theyre employees of Goldman's, Chase, big energy etc....
  • MACDMACD Lee CountyPosts: 5,008 Admiral
    Hey Greggl ........which "opensource" license do you fall under?
  • gregglgreggl Posts: 21,594 Officer
    I like the MIT license. http://opensource.org/licenses/MIT

    Haven't fully decided.
  • MACDMACD Lee CountyPosts: 5,008 Admiral
    greggl wrote: »
    I like the MIT license. http://opensource.org/licenses/MIT

    Haven't fully decided.

    Don't you have some propriety value as a plugin or module?

    "Open-source " does not always mean "free" to the user.
  • gregglgreggl Posts: 21,594 Officer
    MACD wrote: »
    Don't you have some propriety value as a plugin or module?

    "Open-source " does not always mean "free" to the user.

    Derail, but this is a good article that I'm incorporating:
    http://www.wired.com/techbiz/it/magazine/16-03/ff_free?currentPage=all

    Heh:
    Brent Butt ‏@BrentButt
    Google motto 2004: Don't be evil
    Google motto 2010: Evil is tricky to define
    Google motto 2013: We make military robots
  • phlatsphilphlatsphil Posts: 14,632 AG
    FreeLiner wrote: »
    Im fiscally very conservative. Socially very moderate.

    Ive been on the board for years with a differnt screen name. Just been off of here for a while.

    Simple fact is Obama has been and will continue to be a lame duck for our economy. Socially however he is doing great for standing up for those without a voice.....like his said he would on his 2008 website.


    Your mention of Obama implies you think this corporate welfare is something new and unique to his administration. It's not! This crap has been going on for decades.

    Did anyone else even notice that 8 big companies aren't even American companies?
  • bswivbswiv Posts: 8,312 Admiral
    So Phil posts a somewhat partisan ( Based on it's written structure.....yes the highlighting of the Koch folks was meant to confer something.......) and we miss the MOST IMPORTANT point, going off arguing about the partisan tilt.

    Fact is we have two parties representing Big Government that are both snuggled up close to Big Business and we can't/won't do anything about it. That's OUR FAULT.

    From local entities receiving "targeted incentives" to state and Federal infusions of taxpayer $ into "chosen" endeavors and the usually so ugly yet so often praised "public-private partnership" it's happening everywhere to the detriment of the small.

    And we know it, all of us, and yet we stick to our teams which allows us to be divided and conquered.........how sad.
  • CatBoxCatBox Posts: 3,706 Captain
    OK I will bite.

    I put in IBM, Boeing and Intel into GGL's link and it turns out that we are only talking about STATE/LOCAL tax credits not Federal.

    My take is if the individual STATES choose to provide incentives to attract or retain business then it's up to them. ALL three of these companies run factories that could easily be moved overseas and they are CHOOSING to keep them in the US for a variety of reasons.

    Why should we care if a certain State offers an incentive in order to increase employment or attract new business?

    Calling it "Corporate Welfare" is disingenuous.
  • Big BatteryBig Battery Posts: 21,694 AG
    phlatsphil wrote: »
    Remember when President Obama was lambasted for saying “you didn’t build that”? Turns out he was right, at least when it comes to lots of stuff built by world’s wealthiest corporate behemoths. That’s the takeaway from a new study of 25,000 major taxpayer subsidy deals over the last two decades.

    Why would you support either party? They both contribute to that.
  • FreeLinerFreeLiner Posts: 1,572 Captain
    phlatsphil wrote: »
    Your mention of Obama implies you think this corporate welfare is something new and unique to his administration. It's not! This crap has been going on for decades.

    Did anyone else even notice that 8 big companies aren't even American companies?

    I mentioned him because he said he was going to "fundamentally change the way America operates" .....not an exact quote from 2008.

    All he has done is act like GWB V2.0


    Hes our president. He can fix it. Hes the man.
  • FreeLinerFreeLiner Posts: 1,572 Captain
    And then there is this....

    Corporate profit is at a all time high compared to GNP.

    But.....

    Employees pay is at an all time low as a percentage of GNP

    Obamas watch so far has been the pinnacle of income inequality. Hes got it though. Hell get em!
  • rickcrickc Posts: 9,172 Admiral
    It has nothing to do with Obama.

    Corporate America and the 1% have been working for decades and spent untold millions of dollars to have our bought and.paid for representatives in Congress to write the rules in their favor. The golden rule at work. He who has the gold makes the rules.
  • gregglgreggl Posts: 21,594 Officer
    CatBox wrote: »
    I put in IBM, Boeing and Intel into GGL's link and it turns out that we are only talking about STATE/LOCAL tax credits not Federal.

    States can do this. The problem is that they shouldn't.

    It doesn't make financial sense for the community in the long run.
  • bswivbswiv Posts: 8,312 Admiral
    CatBox wrote: »
    OK I will bite.

    I put in IBM, Boeing and Intel into GGL's link and it turns out that we are only talking about STATE/LOCAL tax credits not Federal.

    My take is if the individual STATES choose to provide incentives to attract or retain business then it's up to them. ALL three of these companies run factories that could easily be moved overseas and they are CHOOSING to keep them in the US for a variety of reasons.

    Why should we care if a certain State offers an incentive in order to increase employment or attract new business?

    Calling it "Corporate Welfare" is disingenuous.

    So......you are in business in Florida, you make widgets, have for a long time. Your little company has a few employees, owns a building and a couple of trucks along with whatever related equipment is necessary to make what you sell.

    And then, all of a sudden the Widget King Company says to the state, "Give us some "incentives" and we'll more to Fl. ".......And do understand that "incentives" on a state/local level are generally in the form of reduced unit connection fees for utilities, construction grants for roads, abatement of property taxes for a time......those kinds of things.

    Also included in the "incentive" package is normally someone SPICIFIC to grease the path through the regulatory and permitting stages and a offer of "expedited permitting".

    Now did you get any of that?

    Would having gotten any of that made it easier for you to get started?

    Would it have made you more competitive compared to your competition as a result of the lower cost of production it would allow?

    I could go on but you get the idea.

    And do keep in mind I am in business myself, I champion the reduction and or elimination of corporate taxes and a reduction of business taxes in general as a way to spur economic growth. But......it MUST be done on a uniform basis with no individualizing of incentives.
  • Mister-JrMister-Jr Posts: 28,892 AG
    Perfect B.

    I have a few employees, but no incentive was offered to me.
    Vote for the other candidate
  • CatBoxCatBox Posts: 3,706 Captain
    bswiv wrote: »
    So......you are in business in Florida, you make widgets, have for a long time. Your little company has a few employees, owns a building and a couple of trucks along with whatever related equipment is necessary to make what you sell.

    And then, all of a sudden the Widget King Company says to the state, "Give us some "incentives" and we'll more to Fl. ".......And do understand that "incentives" on a state/local level are generally in the form of reduced unit connection fees for utilities, construction grants for roads, abatement of property taxes for a time......those kinds of things.

    Also included in the "incentive" package is normally someone SPICIFIC to grease the path through the regulatory and permitting stages and a offer of "expedited permitting".

    Now did you get any of that?

    Would having gotten any of that made it easier for you to get started?

    Would it have made you more competitive compared to your competition as a result of the lower cost of production it would allow?

    I could go on but you get the idea.

    And do keep in mind I am in business myself, I champion the reduction and or elimination of corporate taxes and a reduction of business taxes in general as a way to spur economic growth. But......it MUST be done on a uniform basis with no individualizing of incentives.


    Ok I get it now. I agree. :Agree
  • Big BatteryBig Battery Posts: 21,694 AG
    bswiv wrote: »
    So......you are in business in Florida, you make widgets, have for a long time. Your little company has a few employees, owns a building and a couple of trucks along with whatever related equipment is necessary to make what you sell.

    And then, all of a sudden the Widget King Company says to the state, "Give us some "incentives" and we'll more to Fl. ".......And do understand that "incentives" on a state/local level are generally in the form of reduced unit connection fees for utilities, construction grants for roads, abatement of property taxes for a time......those kinds of things.

    Also included in the "incentive" package is normally someone SPICIFIC to grease the path through the regulatory and permitting stages and a offer of "expedited permitting".

    Now did you get any of that?

    Would having gotten any of that made it easier for you to get started?

    Would it have made you more competitive compared to your competition as a result of the lower cost of production it would allow?

    I could go on but you get the idea.

    And do keep in mind I am in business myself, I champion the reduction and or elimination of corporate taxes and a reduction of business taxes in general as a way to spur economic growth. But......it MUST be done on a uniform basis with no individualizing of incentives.

    Exactly..
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