Ron Paul's Texas Straight Talk - A weekly Column

August 9, 1999

Legalized theft
Corporate, international welfare steals from the working

Don't steal," reads one of my favorite bumper stickers. "The government doesn't like the competition!"
The word "steal" might be a little strong, but not by much when one considers the actions of Congress, and especially votes taken this last week on the Foreign Operations Appropriations budget. This budget contains billions of dollars; nearly all of which are not just unconstitutional, but downright crazy.
Many people rightly criticize the growing welfare state as it relates to individuals getting handouts, assistance and other benefits from the government. But the more expensive, and rarely discussed, problem is when government provides handouts, assistance and lucrative benefits to wealthy, multinational corporations.
If an individual takes the money from your wallet to purchase something for himself, it is rightfully considered unlawful. Regardless of the excuse, no matter how good an item he is buying, the thief is still guilty of theft. But when a congressman does the same thing on behalf of a special interest group, it is called the law of the land.
If a businessman comes to a rational person and says, "I want to expand into a new territory, but the downside is that it is an area that is fraught with civil unrest, is economically unsound, the workforce is untrained and we probably won't make a profit." The prudent investor would obviously not take the risk.
But under our current system, that same businessman can make his move with the knowledge that the taxpayers of the United States will bail him out. This bailout comes from several different mechanisms, like the Export-Import Bank and the Overseas Private Investment Corporation. This absurdity that passes for policy is made all the more disgusting when one recognizes that working families, struggling to make ends meet, are being held liable for business decisions that the wealthiest of private investors would likely not cover.
Worse still is that if this risky investment finally has some measure of success, the taxpayer gets no benefit despite the exposure to liability; thus the costs are socialized while the profits are internalized. Of course, grateful recipients of the largess generously fill the campaign coffers of those who vote for these gross subsidies.
Several years ago I first proposed we stop this nonsense for it is simply unconscionable that Texas' family farmers are getting taxed to provide cover for multinational corporations' stupid decisions. Only a couple of my colleagues risked the wrath of the corporate interests back then. The first week in August, however, saw several dozen Members of Congress join me in protesting this egregious policy. Unfortunately, the bipartisan, pro-largess caucus still carried the day. However, I did notice that fewer Members of Congress seem as eager to defend corporate welfare.
These days, of course, the rhetoric of bailing out the corporations is made with allusions to "free trade"; a laughable proposition that could not be further from reality.
Several weeks ago we engaged in the annual debate over the level of free trade our citizens could have with China. I always take the position that one should have free markets and allow Americans to trade with whomever they please, but at the same time taxpayers shouldn't be forced to subsidize foreign governments. The crowd I cannot understand is the one that argues against free trade yet supports subsidizing China and other brutal regimes around the world. That is the other half of what we do with OPIC, the Export-Import Bank and other international managed-trade organizations. By propping up the corporations that move to China, not only are we subsidizing bad business decisions, but also using tax dollars to shore up China's economy without their having to feel the pressure of the free market to change their ways.
The defenders of corporate and international welfare would have us believe that taxpayers get some benefit from seeing their hard-earned dollars go to the boardroom of Boeing or the butchers of Beijing. How one benefits from being exposed to economic risk, or by shipping cash to those with whom one vehemently disapproves, is difficult to imagine.
The economics, however, are not. The taxpayer loses all the way around.
When common thieves steal from us to get what they desire, they at least have the courtesy not to try to convince us it is for our benefit, nor return annually to do so.
Perhaps government also does not like to be outclassed.