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The New Corporate Welfare Queens:

The last Republican Congress justly earned a reputation for wasteful spending, particularly when it came to corporate welfare. Yet it appears the current Congress may do them one better. The last Congress spent over $90 billion per year on various subsidy programs, according to the Cato Institute. Yet, as a W$J editorial reports, the current Congress appears set to break the $100 billion mark.

The handouts for the rich that have a good chance of passing include the most expensive farm bill ever; a rise in the mortgage limits on loans that can be securitized by Fannie Mae and Freddie Mac; some $2 billion in loan guarantees to ethanol producers; and expansions in flood and terrorism insurance to benefit home builders, mortgage banks, and real estate developers.

Perhaps, the Journal suggests, this helps explain recent trends in corporate campaign contributions.

If you want to know how good liberals can tolerate such largesse for the rich, keep in mind that in Washington quids often come with a quo. The latest FEC fundraising reports indicate that industry lobbyists have shifted their allegiance from Republicans and are now funneling cash to Democrats they expect to hold their majority. Roll Call newspaper, which covers Congress, reports that in the first half of 2007 business lobbyists gave "all or most of their cash to Democratic candidates and party committees."

visiting (mail):
The Journal is being ungenerous, and in a significant sense, wrong. The reasons liberals can stomach this is that the major animating worldview of liberals, at least those who hold office in Washington, is not helping the poor, but hostility to allowing the market to dictate economic outcomes. They believe that political management of markets is better than laissez-faire, and that's why they are at least as willing to support corporate welfare as redistributive poverty programs.
10.23.2007 10:31am
Orielbean (mail):
Visiting, your strawman doesn't show up in the WSJ article. They make the clear point that what's good for the goose is good for the gander. The Repubs and Demos are two peas in a pod. They know that the corporations are the ones greasing the lobbyist wheels with tons of cash, and so both groups equally court them with corporate welfare. Show me some of your laissez-faire Republicans and I'll show you some of the Democrats who care about helping the poor. The room would be rather empty, I think.
10.23.2007 11:01am
Adeez (mail):
"The reasons liberals can stomach this is that the major animating worldview of liberals, at least those who hold office in Washington, is not helping the poor, but hostility to allowing the market to dictate economic outcomes."

Wow, this is like the Twilight Zone, where every day on this site at least one commenter (more likely dozens) has to make the mistake of conflating Democrats with liberals. With respect visiting, which liberals "hold office in Washington?" Kucinich is a true liberal: if you know anything about him you'll know that he is anything but insincere in his desires to help the poor. As is Bernie Sanders.

If you wanna trash the rest of those pieces of shit, go ahead. None of those fuckers, D or R, work for us. And this just illustrates why we need to get money out of politics. I know it makes some here go apeshit, but can we at least agree on what a severe problem it is?
10.23.2007 11:06am
bla bla (mail):
But isn't there a market failure argument for government flood and terrorism insurance, at least in some cases?
10.23.2007 12:07pm
Miss. Lawyer (mail):
Is it fair to compare a farm bill year with a non farm bill year when talking about subsidies? Furthermore, is the farm bill correctly considered largesse for the rich?
10.23.2007 12:19pm
liberty (mail) (www):
bla bla,

I am no expert in those insurance areas, but you might find this article interesting. It is Regulation magazine and its about the farm bill - it talks about federal insurance and why it isn't correcting a market failure. I suspect that the same logic applies to those other kinds of insurance.

Miss Lawyer:
It is, because the vast majority of the money goes to big farm corporations. You should also read the link I provided above for bla bla.
10.23.2007 12:31pm
therut:
Well at least someone above finally let the cow out of the barn. Sanders is a Socialist as he admits and it is finally nice to know liberal and socialist is really the same thing. I knew it all along. Add to that the use of Progressive in the same manner. And please Socialism never helps the poor as we all know. It is a LIE. The whole problem is not money in politics but the government busybodys of all strips in the market. They have ruined Health Care and some want to go ahead and kill it with more government control. Freedom and liberty are to hard for citizens of this country. They had rather pout and hold out their hands and whine. It is irritating as a 3 year old asking WHY.
10.23.2007 1:10pm
Thales (mail) (www):
"Furthermore, is the farm bill correctly considered largesse for the rich?"

In a word, yes. Archer Daniels Midland and Cargill, to name just two beneficiaries. The idea that farm subsidies as currently constituted do much for the "family farmer" is largely hogwash. Further, they are likely illegal under our trade agreements (and certainly against the spirit of the free trade ethos we spread to/impose on other nations) and harm the poor here and in other countries by making food more expensive and rendering developing country farmers unable to compete with their superior (in terms of price) goods. They also spur retaliatory tariffs and other protectionism, which hurt consumers.
10.23.2007 1:13pm
KeithK (mail):
And this just illustrates why we need to get money out of politics.

I agree completely. Let's cut the federal budget to a tiny fraction of what it currently is, cut taxes significantly, close up shop on tens or hundred sof government agencies. When you take the money out of the hands of Congress there will be much less reason to be corrupt with it.
10.23.2007 2:54pm
Cornellian (mail):
The latest issue of The Economist has a short article on the Republican party's drift from being a party of business to being a party of the religious right. They note the decline of business contributions to Republicans and corresponding increase in business contributions to Democrats and point out, quite rightly, that if the Republican party has ceased to be the party of business, they can hardly be suprised if business takes their contributions elsewhere.
10.23.2007 3:32pm
bla bla (mail):
"I am no expert in those insurance areas, but you might find this article interesting. It is Regulation magazine and its about the farm bill - it talks about federal insurance and why it isn't correcting a market failure. I suspect that the same logic applies to those other kinds of insurance."

Well, the issue is whether the correlation of the risk involved in flood and hurricane insurance prevents private insurers from providing applicable insurance. The article that you link to says that private insurers have been able to cater to this market, but I have at least anecdotal evidence to the contrary: In the Northeast, its very difficult (impossible?) to get flood insurance on new homes. I've always assumed that this shows that there is enough risk correlation to justify government insurance, but I'd love to reconsider my views (for the sake of ideological purity) if someone else can disprove this argument.
10.23.2007 3:59pm
Chimaxx (mail):
If it's not possible in the Northeast to get flood insurance on new homes, then builders should be forced to take that into account when choosing whether/how to build those new homes and buyers should be forced to take that into account when deciding how much to pay for those homes or whether to buy them at all, rather than counting on government insurance to bail them out.

If there is a market failure here, it is not on the part of the insurers, but on the part of the real estate developers.
10.23.2007 4:27pm
bla bla (mail):
"If it's not possible in the Northeast to get flood insurance on new homes, then builders should be forced to take that into account when choosing whether/how to build those new homes and buyers should be forced to take that into account when deciding how much to pay for those homes or whether to buy them at all, rather than counting on government insurance to bail them out.

If there is a market failure here, it is not on the part of the insurers, but on the part of the real estate developers."

As far as I can tell, you're not really addressing the coordinated risk market failure argument. You're just sort of making an assertion. Is the coordinated risk argument flawed? Is there a reason for believing that it doesn't apply here?
10.23.2007 6:04pm
liberty (mail) (www):
Like I said, I am not an expert in the area, but I would look to see whether there is any interference already that might be causing the failure. Presumably people want flood insurance. If they don't, then why should government provide it? What are the major positive externalities if you don't assume that government would bail you out in the event of an actual flood? If you make that assumption then you have your interference already. Stop saving the victims and they will demand insurance.

If people want flood insurance, why aren't they buying it? They don't demand it at the price that the risk warrants? Either the risk for the insurer is too high (houses are poorly made) or people aren't evaluating their risks properly (government bails them out when there is a flood). We spoke about the latter already, what about the former? Is there any interference that could causes the houses to be poorly made? What if they are forced to compete with very low priced alternatives, like say subsidized mortgages? Could this be linked to the major low-cost mortgage crisis we are seeing right now?

Just some thoughts.
10.24.2007 12:20am
Smallholder (mail) (www):
Is it just me or has the tenor of the comments section of the Conspiracy changed? I know we stand four square for freedom of speech, but I'm disappointed with the frequency of profanity of late. I like to refer my high school students to the comments thread and felt more comfortable doing that when the language was clean.

That out of the way, I too want to swear whenever a farm bill comes up. Farmers, welfare queens that they are, claim that they need, I say need, really need, handouts to survive. How's that working?

The subsidies are simply in place to maintain a cycle of overproduction for the benefit big corporations like Conagra. The environnmental costs are high. The right ought to support ending subsidies on market principles and the left ought to support ending the subsidies to protect the enviornment and the true family farmer.
10.24.2007 10:05am
Eli Rabett (www):
You know, we have pretty much eliminated the excess stocks of agricultural products (aka food) and production is pretty close to consumption. This should scare you if you have paid attention to the lack of rain in the large agricultural regions of the US.

As Joseph taught us, protecting against famine requires a certain level of inefficiency in agriculture, and that means farm subsidies to maintain excess capacity.
10.24.2007 12:30pm