http://www.reason.com/0403/fe.js.confessions.shtml
some juicy bits.
My Life as a Welfare Queen
In 1980 I built a wonderful beach house. Four bedrooms -- every room with a view of the Atlantic Ocean.
It was an absurd place to build, right on the edge of the ocean. All that stood between my house and ruin was a hundred feet of sand. My father told me: "Don’t do it; it’s too risky. No one should build so close to an ocean."
But I built anyway.
Why? As my eager-for-the-business architect said, "Why not? If the ocean destroys your house, the government will pay for a new one."
What? Why would the government do that? Why would it encourage people to build in such risky places? That would be insane.
But the architect was right. If the ocean took my house, Uncle Sam would pay to replace it under the National Flood Insurance Program. Since private insurers weren’t dumb enough to sell cheap insurance to people who built on the edges of oceans or rivers, Congress decided the government should step in and do it. So if the ocean ate what I built, I could rebuild and rebuild again and again -- there was no limit to the number of claims on the same property in the same location -- up to a maximum of $250,000 per house per flood. And you taxpayers would pay for it.
Thanks.
Today’s biggest welfare queens are probably farmers -- once, in their glory days, the most self-sufficient of Americans.
When I make speeches about free markets at Farm Bureau conferences, farmers applaud enthusiastically. But despite their surface support for free markets, most of them operate in a market that’s very expensive for all of us, receiving $200 billion in direct handouts this decade, plus another $200 billion in artificial price supports (which force us all to pay more for food).
Farm supports are as destructive as the old welfare payments to poor people were. Just as addictive, too. Subsidies are supposed to help farmers recover from low prices caused by overproduction, but the subsidies lead farmers to plant more crops, creating more overproduction, which lowers prices, making farmers even more dependent on handouts.
The programs wreck the lives of farmers in poor countries because they can’t compete with subsidized American farmers (or with even more-subsidized European farmers). Hypocritical politicians blather constantly about helping the poor and demand more of your tax money for foreign aid. But they simultaneously give out farm subsidies, which rig the system so that all over the world poor farmers stay poor.
Why shovel all this money to American farmers?
Because we like farms. Farms are romantic. No one wants to lose the family farm. Of course, most handouts don’t go to family farms. They end up going to big farm corporations, because the big, established companies are most skilled at using the system. Fortune 500 firms like Westvaco, Chevron, John Hancock Life Insurance, Du Pont, and Caterpillar each get hundreds of thousands of dollars in subsidies.
The whole thing is worth a read.When public interest groups compile lists of corporate welfare recipients, a company called Archer Daniels Midland (ADM) is usually at the top of the list. You may never have heard of ADM, because its name rarely appears on consumer products, but it’s huge. Its products are in most processed foods.
ADM collects welfare because of two cleverly designed special deals. The first is the government’s mandated minimum price for sugar. Because of the price supports, if a soft drink maker wants to buy sugar for its soda, it has to pay 22 cents a pound -- more than twice the world price. So Coca-Cola (and almost everyone else) buys corn sweetener instead. Guess who makes corn sweetener? ADM, of course. Now guess who finances the groups that lobby to keep sugar prices high?
ADM’s second federal feeding trough is the tax break on ethanol. Ethanol is a fuel additive made from corn, kind of like Hamburger Helper for gasoline, except that it’s more expensive, so no one would buy it if government didn’t give companies that use ethanol a special 52-cent-a-gallon tax break. That costs the treasury half a billion dollars a year. ADM produces half the ethanol made in America.
Why does ADM get these special deals? Bribery. OK, it’s not technically bribery -- that would be illegal. ADM just makes "contributions." Through his business and his family, former ADM Chairman Dwayne Andreas gave millions in campaign funds to both Mondale and Reagan, Dukakis and Bush, Dole and Clinton. President Nixon’s secretary, Rosemary Woods, says Andreas himself brought $100,000 in cash to the White House. He even paid tuition for Vice President Hubert Humphrey’s son. Republicans, Democrats -- it doesn’t matter. ADM just gives.
It also flies people around on its corporate jets. When we contacted Andreas to ask for an interview, he arranged to fly us to ADM’s Decatur, Illinois, headquarters in one of ADM’s jets. I’ve seen private jets before, but ADM’s was a step above. A flight attendant served us excellent food on gold-plated china. The camera crew and I loved it. Bet the politicians like it too.
