If there’s one thing that has everyone across the ideological spectrum fed up, it’s corporate welfare. Corporate welfare is a term to describe when government gives hand-picked businesses money or favorable treatment. Business and government curling up in bed together has been a growing problem since the country began but became much more salient with last year’s unpopular bailouts to over 600 businesses.
It wasn’t just the bailouts. Public opinion has been turning against stimulus funding as it looks less and less like money is going to the highest-need use and more and more is being used to unfairly pick winners and losers among businesses.
Left-of-center political commentator Robert Reich cites corporate welfare as the leading concern of “the mad-as-hellers” – his label for a third party of angry Americans made up of folks from the left and right, of which Reich counts himself a member.
Reporter John Stossel is joined by many on the right trying to drive a wedge between corporate welfare, or “crony capitalism” as he calls it, and free-market capitalism. This camp points to the causes of the financial crisis and the government’s responses as recent evidence of just how bad the problem has become.
President Obama has stepped up his rhetoric against corporate welfare lately – claiming in his State of the Union address that, along with everyone else, he “hated” bailing out reckless businesses; and he continues to lash out against lobbyists and interest groups.
So why does it continue? Why is corporate welfare, the great unifying threat that we all agree must be stopped, not receding but instead coming off its biggest growth year yet?
The reality is that politicians have fed this beast for so long, they’re having trouble reining it in. Whenever government gives more power and money to business or interest groups, it creates a new constituency that will fight tooth and nail to keep – and grow – its funding.
This process is bad for growth and bad for democracy. Stay tuned to the Bankrupting America blog as corporate welfare will be a major issue that we tackle.
