It's All Welfare - Not Just Poor People

by Lewis Loflin

Both parties are still welfare parties differing only in how that welfare is distributed. Tax breaks and state subsidies for business are just as much welfare as food stamps and housing assistance. The home mortgage interest deduction with other housing programs that benefit mainly the affluent is one example. To quote The New York Times article Illogical Housing Aid Oct. 30, 2012:

Today, the federal government spends about $40 billion annually on housing programs designed specifically for low-income households. Yet the mortgage interest deduction alone costs the Treasury some $80 billion a year. Almost $35 billion in housing aid goes to families with incomes above $200,000.

It's all welfare and while the NYT calls for redirecting an extra $35 billion to the poor, thus increasing welfare housing (paying inflated rents benefiting landlords) costing taxpayers $75 billion. Let's end all of it and save $120 billion. From home mortgage interest deduction alone from 2010 through 2014 will cost taxpayers $484 billion.

Student loans are another looming bubble where taxpayers assume all risks while lenders pocketed billions. Again we had the problem of irresponsible lending where many of those attending college shouldn't even be in college. Also the loans should consider what degree was being pursued and barring loans for nonsense with little chance of return. Lenders and the education industry win, the public and taxpayers lose. (Not counting enslaving millions to debt.)

According to the Heritage Foundation the cost for President Obama to buy the votes of "young people" (meaning those in college) by keeping interest rates at an artificially low 3.8 percent costs all taxpayers, including the 70 percent without college degrees, and extra $6 billion. For the borrower he/she saves a whopping $7 a month. The government shelled-out $104 billion (2010-2011) tax dollars in often risky student loans that fail to factor in the ability of the borrower to pay it back. This flood of easy money only serves to inflate tuition costs.

Both parties engage in "redistribution" and manipulating the system so the outcomes benefit their core constituents. In the above example Republican Wall Street lenders and the Democratic education industry are the big winners, taxpayers suffer the losses. We need regulation regardless of what Republicans claim to prevent fraud, abuse, and destructive speculation. But we also need to limit government meddling which distorts the entire economy. Deregulation combined with misguided government meddling is the cause of our recent problems on Wall Street.

The over $80 billion for corporate welfare from state/local governments is double what government spends on housing assistance for poor people Republicans want to cut. Texas is the biggest corporate welfare state spending around $19 billion a year, while at the same time cutting $5 million from education. We've all heard about Republican Gov. Rick Perry and his so-called "job creation" miracle. But the facts on the ground are not as they seem. Of those whopping 279,000 jobs from 2007-2011, a study by the non-partisan Center for Immigration Studies found that:

...81 percent of those "new jobs" in Texas went to immigrants at least half illegal. It's part of a three-decade long pattern of displacing the native born workforce with cheaper imported and often illegal labor. Of those jobs taken by newly arrived immigrants, 93 percent were non-citizens...most arrived after 2007..."

See 'Immigrants' Take Most of the New Jobs in Texas, Elsewhere.

Many of the jobs are not new jobs, but jobs simply relocating around the country to cut wages for their workers and chasing expensive "incentives". The recent loss of 18,000 union jobs by Hostess will certainly be shipped to labor hostile, low-wage states such as Virginia and Texas and be underwritten by generous corporate welfare packages. Many of the jobs may not even go to U.S. citizens.

Ref Lines Blur as Texas Gives Industries a Bonanza New York Times Dec. 2, 2012.

Now that Obama has been re-elected nothing will change.

See Illegal Immigration-Crime