The GOP’s Addiction to Corporate Welfare
Corporate welfare has bred a REPUBLICAN CULTURE OF DEPENDENCE. Legislative reform is long overdue.
October 11, 2000
WASHINGTON – To hear George W. Bush and his running mate, Dick Cheney, tell it, they are both self-made men, products of the private sector who made their fortunes without the helping hand of government.
This is balderdash. In these self-proclaimed conservative candidates, we see two of the nation’s prime beneficiaries of a government practice widely known as corporate welfare, or socialism for the rich. Both owe virtually every dime they have earned to the help of government.
Bush, who derides Vice President Gore as the candidate of big government, made his own killing from one of government’s most abusive powers, the ability to seize private land from its owners at below market rates.
When actually in private business for himself, Bush was a perennial loser. His profits came chiefly from investors who gave him money because of government tax breaks for the oil industry.
His real fortune was made when he became a 2% owner of the Texas Rangers baseball team. The city of Arlington, Tex., was persuaded to build a new stadium for the team. When one family refused to sell a 13-acre plot at half its appraised value, Arlington condemned the land for the stadium project.
As Joe Conason wrote in Harper’s Magazine in February, “Never before had a municipal authority in Texas been given license to seize the property of a private citizen for the benefit of other private citizens.” Bonds to build the stadium were financed by another abusive government practice, a sales tax.
Then the Rangers got the stadium for a song, in a rent-to-buy agreement. They paid $60 million — the equivalent of 12 years’ rent — for a facility that had cost an estimated $190 million.
With this state-of-the-art ballpark, the value of the Rangers tripled. When the team was sold in 1998, Bush’s initial $600,000 investment (all borrowed) had turned into $15 million. Yes, Bush performed work for the Rangers as the public face of the team’s owners and chief cheerleader. But his spectacular fortune was the direct result of government intervention on his behalf.
Cheney, as we have also seen, made his killing after a career in government service when he was hired to run Halliburton Inc. — in large part because of the foreign contacts he had made as secretary of defense.
He made $20 million, not counting $18 million in stock options, when he left Halliburton. Though he told Sen. Joseph Lieberman (D-Conn.) that government had nothing to do with his sudden wealth, he was hired purely on the basis of his government experience.
In addition, a Halliburton subsidiary, Brown & Root, received nearly $2 billion in Pentagon contracts and ranks as No. 17 on the Pentagon’s list of prime contractors.
This is not just ancient history. Bush and Cheney are a new kind of conservative. Traditional conservatives wanted to reduce, even eliminate, government and cut taxes. These new conservatives want the government to continue to collect taxes — but turn the proceeds over to private industry.
Here is the common thread of Bush’s major proposals: Government collects Social Security taxes — but gives a chunk of the money to Wall Street.
Government collects school taxes — but gives the money out in vouchers that can be used in private schools. Government collects Medicare taxes — but gives the money to private insurers who will provide health coverage.
This is not old-style conservatism. It is a strategy to use the government’s coercive powers of taxation and legislation to funnel public wealth to the private sector. That’s what made Bush and Cheney rich.