That's over and above our payments to the big companies for energy
and food and housing and health care and all our tech devices. It's
$6,000 that no family would have to pay if we truly lived in a
competitive but well-regulated free-market economy.
The $6,000 figure is an average, which means that low-income families
are paying less. But it also means that families (households) making
over
$72,000 are paying
more than $6,000 to the corporations.
1. $870 for Direct Subsidies and Grants to Companies
The
Cato Institute
estimates that the U.S. federal government spends $100 billion a year
on corporate welfare. That's an average of $870 for each one of
America's
115 million families. Cato
notes
that this includes "cash payments to farmers and research funds to
high-tech companies, as well as indirect subsidies, such as funding for
overseas promotion of specific U.S. products and industries...It does
not include tax preferences or trade restrictions."
It
does include
payments to 374 individuals on the plush Upper East Side of New York City, and
others who own farms, including Bruce Springsteen, Bon Jovi, and Ted Turner. Wealthy heir Mark Rockefeller received
$342,000 to NOT farm, to allow his Idaho land to return to its natural state.
It also includes fossil fuel subsidies, which could be anywhere from
$10 billion to
$41 billion per year for research and development. Yet this may be substantially
underestimated. The
IMF reports U.S. fossil fuel subsidies of $502 billion, which would be
almost $4,400 per U.S. family
by taking into account "the effects of energy consumption on global
warming [and] on public health through the adverse effects on local
pollution." According to
Grist,
even this is an underestimate.
2. $696 for Business Incentives at the State, County, and City Levels
The subsidies mentioned above are
federal subsidies. A New York Times
investigation found that states, counties and cities give up over $80 billion each year to companies, with beneficiaries
coming from
"virtually every corner of the corporate world, encompassing oil and
coal conglomerates, technology and entertainment companies, banks and
big-box retail chains."
$80 billion a year is $696 for every U.S. family. But the Times notes that "The cost of the awards is certainly far higher."
3. $722 for Interest Rate Subsidies for Banks
According to the
Huffington Post, the
"U.S. Government Essentially Gives The Banks 3 Cents Of Every Tax Dollar." They cite
research
that calculates a nearly 1 percent benefit to banks when they borrow,
through bonds and customer deposits and other liabilities. This amounts
to a taxpayer subsidy of $83 billion, or about $722 from every American
family.
The wealthiest five banks -- JPMorgan, Bank of America
Corp., Citigroup Inc., Wells Fargo & Co. and Goldman Sachs --
account for three-quarters of the total subsidy. The Huffington Post
article notes that without the taxpayer subsidy, those banks would not
make a profit. In other words, "the profits they report are essentially
transfers from taxpayers to their shareholders."
4. $350 for Retirement Fund Bank Fees
This was a tough one to calculate.
Demos
reports that over a lifetime, bank fees can "cost a median-income
two-earner family nearly $155,000 and consume nearly one-third of their
investment returns." Fees are well over one percent a year.
However, the
Economic Policy Institute
notes that the average middle-quintile retirement account is $34,981. A
conservative one percent annual management fee translates to about $350
per family. This, again, is an average; many families have no
retirement account. But many families pay much more than 1% in annual
fees.
5. $1,268 for Overpriced Medications
According to
Dean Baker,
"government granted patent monopolies raise the price of prescription
drugs by close to $270 billion a year compared to the free market
price." This represents an astonishing annual cost of over $2,000 to an
average American family.
OECD figures on pharmaceutical expenditures reveal that Americans spend almost
twice the OECD average on drugs, an additional $460 per capita. This
translates to $1,268 per household.
6. $870 for Corporate Tax Subsidies
We've heard a lot about
tax avoidance and tax breaks for the super-rich. With regard to corporations alone, the
Tax Foundation
has concluded that their "special tax provisions" cost taxpayers over
$100 billion per year, or $870 per family. Corporate benefits include
items such as Graduated Corporate Income, Inventory Property Sales,
Research and Experimentation Tax Credit, Accelerated Depreciation, and
Deferred taxes.
Once again, it may be even worse.
Citizens for Tax Justice cite a Government Accountability Office
report
that calculated a loss to the Treasury of $181 billion from corporate
tax expenditures. That would be almost $1,600 per family.
7. $1,231 for Revenue Losses from Corporate Tax Havens
U.S. PIRG
recently reported that the average 2012 taxpayer paid an extra $1,026
in taxes to make up for the revenue lost from offshore tax havens by
corporations and wealthy individuals. With
138 million taxpayers (1.2 per household), that comes to $1,231 per household.
Much More Than an Insult
Overall, American families are paying an annual $6,000 subsidy to corporations that have
doubled their profits and cut their taxes in half in ten years while
cutting 2.9 million jobs in the U.S. and adding almost as many jobs overseas.
This
is more than an insult. It's a devastating attack on the livelihoods of
tens of millions of American families. And Congress just lets it
happen.
Slowdown 'central' to climate report
Human role in warming 'more certain'
