Tax Break Chart

Often at we have headlines about the abuse of social welfare programs. Make no mistake, there is much abuse of social welfare programs. But the form of welfare the receives much less discussion… corporate welfare.

According to a new report, the federal government spent $59 Billion on social welfare programs in 2006. While that number is high, it is nearly half of the taxpayer dollars given to assist corporations. That number, a staggering $92 Billion.

Huge, and likely profitable corporations, were able to get tax breaks for themselves, as well as some receive direct spending from the Federal Government.

According to the report, Think by Numbers, the definition of corporate welfare isn’t even lucrative no-bid contracts for defense contractors, but just the massive subsidies offered by the Feds to industries such as coal, wind, ethanol and oil.

For instance “…the $15 billion in subsidies contained in the Energy Policy Act of 2005, to the oil, gas, and coal industries, would be considered corporate welfare because no goods or services are directly returned to the government in exchange for these expenditures.”

Tax Break Chart
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Sonya Sandage

Sonya Sandage is a financial industry professional, and has worked for the nation's largest banks and investment wirehouses for 12 years as Private Wealth Manager. Originally from Florida, and a graduate of UF, she now resides in Washington, DC. Her goal is to get more Americans interested and engaged in their nation's governance.

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  • CaptainUSA

    Thank you for this. So many are slamming people for being on welfare after their Job moved to China or Mexico or India and dont even realize they work for a company that is twice as bad.

  • g.johnon

    really? 92 billion in 2006? why did you go all the way back there and not deal with the 280 billion a month wall street pump an dump that is going on right now. not to mention the over a trillion in tarp bailouts as a down payment to our wall street “masters”?
    as for those scurrilous social welfare abuser that you mentioned; they are very few and far between but highlighted in the media as a much more serious problem than they actually are in order to distract joe and jane six pack from understanding who the real abusers are.

  • cindereller

    This is important for people, especially “conservatives”, to understand because the talk amongst them is all about the poor being the main culprits in the whole “country going broke” discussion! The ones who are getting rich are the ones who are getting the corporate handouts, while the poor are staying poor…duh.

  • Crizbee

    The subsides repotted here were benefitting the small / medium business as much or more than the corporations. Most of the alternative energy companies are mom and pop shops, i know first hand. These were subsidies that made the energy affordable enough for people to put it in their home or business. This was a way to make it cheaper. It was a way to promote sales. Not socialism. Good grief. Point out the real takers here…The oil & gas industry

    • john

      Read Economics in One Lesson by Henry Hazlitt, in particular Chapter 14: Saving the X Industry (available free from the Von Mises Institute website). Subsidization always results in a net loss of wealth for everyone except said industry. In fact, subsidization is a direct way for governments to force taxpayers to transfer wealth to the subsidized industry, therefore artificially bolstering an industry that the free market would have otherwise truncated through market competition at a loss (and no gain) to them.

      And the author didn’t accuse it of being socialism, because that’s not what it is: it’s corporatism, just like Obamacare, and those who value the free market should be disgusted by it.

    • g.johnon

      really? gosh I don’t remember hearing about management in any small or medium companies receiving multimillion dollar bonuses after receiving this largesse.

  • Albert

    I’m quite surprised this was covered here, but surprised pleasantly. The uber-wealthy are constantly sheltered and protected by the corporate media while bilking billions of the taxpayers’ money.

    I constantly hear the message that the ultra-rich are being taken advantage of and taxed into oblivion by the evil poor moochers when in reality the net worth of the ultra-wealthy has been skyrocketing during the same span of time that everyone else is at best losing a bit and in many cases going broke and going through foreclosure of their homes.

    I’m against any abuse and corruption, but the biggest focus should be on the biggest offenders, and that is corporate corruption.

  • ZackForester

    We pay $300 billion a year in debt service to the Federal Reserve for… NOTHING. Congress has the constitutional authority to print it’s own money. It doesn’t need to be borrowing money from middlemen artificially inserting themselves between them and the Treasury.

    • WhoCares

      You do realize that printing rather than borrowing will raise prices, so we get screwed anyway, yes? Borrowing, as bad as it is, can potentially at least reward the more frugal (savers) by paying them interest. (Although, not nowadays with these rates… lol) “Creating” money is a hidden tax, and counterfeiting, AND a subsidy to whichever groups get a hold of the new money first (mostly banks), and I would say it’s much more damaging than issuing bonds to savers on a voluntary basis.

      • Dr. Bill O’Wrightz

        The difference is that you don’t pay interest when you honestly inflate directly rather than through borrowing from the fed at special favorable interest rates.

        • WhoCares

          I’m not sure this distinction matters much. The *government* wouldn’t pay interest in that case, but the people are still getting screwed over. We’re never going to pay these “loans” back in full anyway. So the debt gets bigger faster due to debt servicing–fine, “loan” more to pay for that.

          I think the only distinction that does matter here is that the current Fed based system will eventually implode once we can’t service that debt. The “direct inflation” method could go on robbing people indefinitely, yes?

  • kjuu
    • RussL

      Always going forward because they can’t find reverse.

  • averagejoeusername .

    So a tax break is “welfare”? A tax break is a “subsidy”? This is complete nonsense and lies that fool simpleminded people. This is a very simple “divide and conquer” strategy. Somehow the “taxpayers” are “footing the bill”? Keeping your own money isnt a subsidy, its sure as HELL not “welfare”. So for every deduction I take on my personal taxes does that mean its a govt subsidy and that I’m on welfare? No it does NOT.

    • WhoCares

      That’s right but I think you’re preaching to the choir and also missing the overall point, which I think is more about uneven tax burdens (with the most powerful special interests getting a lesser share of the tax burden).

      But maybe you’re just arguing over semantics of the word welfare. I would say welfare is a *negative* tax rate – redistributing stolen funds, which probably does make the term “corporate welfare” illogical assuming they still have a net loss after factoring in taxes paid.

      • averagejoeusername .

        Well, uneven tax burdens are just a symptom of the corruption of the State. When a organization is big enough they can “lobby” and buy laws to favor them. Its disgusting but thats how it works. Why do we even have such a complicated tax code? Simple-so the IRS can target political enemies and to line the pockets of govt employees

    • john

      Tax breaks are just an indirect subsidy, still paid for by an increase in taxes for everyone else with only possible lower prices for whichever goods and services to make up for them. And since the point of subsidization is to make more money and weed out competition, why would they lower prices?

      • averagejoeusername .

        NO NO NO NO NO!! “indirect subsidy”? Really? So your assumption if a company’s profit BELONGS to the govt? And if the govt allows them to keep a little OF THEIR OWN MONEY it “costs” everyone more? Nonsense. Don’t even get me started on your “point of subsidy” there exists the immutable laws of supply and demand which should determine price.

        • john

          You’re wrong. Here’s a quote from the Think by Numbers article and another from a New York Times article.

          “Tax breaks targeted to benefit specific corporations could also be
          considered a form of welfare. Tax loopholes force other businesses and
          individual taxpayers without the same political clout to pick up the
          slack and sacrifice a greater share of their hard-earned money to
          decrease the financial burden on these corporations.”

          “The federal government now allows more than $1.1 trillion a year in this
          and other tax expenditures. Each of those incentives — which include
          hundreds of exemptions, exclusions, deferrals and preferential rates —
          either adds to the budget deficit or shifts the cost of government to
          other taxpayers.”

          We all know that in a deficit, our government will choose to increase taxation before decreasing spending. Point is, the government will always meet their budget goals eventually, and it makes perfect sense that they would do so by screwing over the average person and helping the massive corporations that really run things.

          As for pricing, if there’s little to no competition, they can and will charge whatever they want, and if it’s a necessary product/service, people will have to pay for it. And tax breaks/subsidies/etc, all forms of economic favoritism, decrease competition immensely.

          • averagejoeusername .

            Your post proves to me some people will believe anything. FYI “the government will always meet their budget goals eventually” you should look at detriot. About 1/2 of all people no longer pay the property taxes on their own homes because the govt does have enough people or funds to steal the property. Govt pensions (aka promises based on nothing to avoid a current pay increase instead promising a future fairytale) are now swallowing the operating budget of detroit. Yes, there exists a situation when the govt gets too big and the tax base disappears.

    • weaver

      A Corporate Charter is a subsidy, as is a limit to liability. Corporate charters were at one time renewed every 20 years, or not, based upon an examination of their contribution to the public.

      • Dr. Bill O’Wrightz

        i’d like to see that today

    • Ryan McMickle

      I just commented on this issue and I’m really happy to see that I’m not the only one to see this. If the author held the citizens on “wel-fare” to the same standards,they’d have to include their lack of income taxation as a form of “wel-fare” — which they obviously are unwilling to do. Such stupidity these days…

    • g.johnon

      careful joe, most “simple minded” people are not simple minded, just government educated. (mentally suppressed)

  • blacksunshine84

    Walmart has a resource dept now to sign up its employees for government entitlements. Forcing USA taxpayers to pay salaries to a corporation’s employees is fascism.

  • FC

    A Tax break, AKA being able to keep YOUR OWN money is not welfare! I’m against all the bail outs, but being able to keep your own money should not be included in the numbers of receiving welfare.

    • WhoCares

      Correct, but there is something to be said for giving X special interest group a greater “tax break” (just lower taxes really) than Y. Calling that welfare may not be accurate, but it’s certainly less “fair” than a flat tax would be.

      • FC

        I agree a flat tax is the fairest way to go..The amount of spending is the problem, I don’t think the problem is some don’t pay enough, the problem is, some pay way to much! The people who complain the loudest are those who aren’t paying anything. And it amazes me how people will argue what is fair based on %, when in reality, the one paying the lower % is paying much much more for the same services everyone has access too. If two people walked into a store to buy an apple and the one was charged twice as much because he had more money in his pocket, that would not be fair. Yet what we have here is the one who was charged half what the other was, says he got the short end of the stick because the other guy had three times the amount of money in his pocked, so he should have been charged three times the amount.

    • arariel

      Tax cuts are good. Tax breaks are not. Tax breaks are obtained by lobbying for special privileges, having rules for other people apply to you. There’s nothing wrong with using tax breaks that are already there (though they should be removed), but lobbying for them is equivalent to asking for a subsidy.

    • Cin

      That’s true but shouldn’t that break be applied to all companies not just favored ones?

  • Seriously

    Does anyone proof read these articles?

  • ax123man

    If it Moves, Tax it. If it Keeps Moving, Regulate it. And if it Stops Moving, Subsidize it.

    But why is this so? Because the truth is, for all their rhetoric, the bureaucrats aren’t even necessary. It’s slight of hand trickery. The common thread here is government. Who can blame the rich or the poor given the incentives laid down. And so many have fallen victim to this treachery. The partisan bickering and class warfare just plays into their hands. Like taking candy from a baby.

  • Dr. Bill O’Wrightz

    The same folks that want to make you ask permission every time you buy something (shades of slavery?) are the ones who consider themselves too big to fail. They should have been shut down. No bailout. No welfare to them who have no mercy when it comes to usury against the poor.

  • Ryan McMickle

    Unbelievably misleading. The author says $92 Billion in the form of corporate wel-fare, citing $71.9 Billion of that being in the form of “tax breaks”. “Tax Breaks” are NOT wel-fare. Holding poor people to the same standards, the fact they pay no income tax is a “tax break”. Then that fifty some billion would amount to hundreds of billions because not taxing them is apparently a form of wel-fare. No logic in this article whatsoever.

    • Peter D. Richter

      If it is a tax break that is offered to only one company, or only to one industry, then it should be counted. Now don’t get me wrong, there ought to be no taxes or dramatically reduced taxes for everyone, but singling out one company IS picking winners and losers, and the government is hurting EVERYONE by doing this.

      • J. Keller

        There ought to be no taxes? Are you high?
        I guess your understanding of economics is poor at best.
        I’ll keep it simple: Taxes are the income of a nation, whichever. No taxes, no income, no country. Period.

        • Rego

          I think what Peter was alluding to was the elimination of the Income Tax, and most other taxes and forcing government to work with what it actually takes in. I think as an Anarchist at some point you can eliminate all taxes and work voluntarily with people, but its all about taking baby steps. :) I don’t justify my country because of taxes. I justify I am a person of the world because I am an individual, and I am alive.

        • jrkarar .

          Wrong, taxes are the income of the government. Not the nation. There is a distinction. The income of the nation is accumulated by producing stuff people need and want, which is then purchased by those people through mutually beneficial exchange.

          The government on the other hand accumulates income by stealing it from people, takes a lot off the top in “administrative costs”, and then uses it to do many things poorly, including starting schools to indoctrinate people into that they cannot learn anything outside of school, that critical thinking is evil, and that the government is the nation.

          • Charly Voisine

            where did you get your education?

    • Joey Beans

      I don’t know, you give tax breaks to the poor, tax breaks to corporations…ummm, and just who is left holding the bag?

  • zeeon

    I’d love to finish reading this article, but someone needs to take an English class and learn how to form a proper sentence. What’s going on with you lately Ben? Hire some competent journalists.

  • Rich Helm

    Tax breaks for corporations are tax breaks for consumers. Corporate taxes are double taxation of the public because corporations just pass the tax onto the consumers. The corporate tax should be zero, anything else is a punishment of the people.
    Subsidies should be eliminated.

    • Mitesh Esfahani

      Very true

    • Anthony J Peasley

      When the government taxes me, my employer has to charge the customer more in order to up my pay…

      Be consistent with it, and there should be no taxes for anyone..

      • Rich Helm

        That is nonsense. your employer is not responsible for nor cares what you pay in taxes. So no, the customer is not charged more for your taxes. Employers do NOT increase pay to taxes.

    • jerry

      thank you! you need to be in office

  • GirlfriendMD

    You also neglected to point out that corporations who pay minimum wage and encourage their workers to use federal assistance programs are, in essence, on corporate welfare. They do not have to pay their staff a living wage, as they know that those staff will be eligible for food or welfare assistance. Essentially, they are taking advantage of social welfare in order to pad profits. McDonald’s directs employees in how to apply for food stamps or welfare (and even encourages their workers to sell any “unwanted Christmas gifts” in order to support themselves). If we enforced an actual living wage, you’d see workers able to support themselves without social programs, not to mention have a bit more cash to spend, which would actually spur the economy. But no, we can’t do that, we’d be punishing the “job creators.”

    • bondservant

      In the real world, there’s no such thing as a “living wage” – employees are hired for the sole purpose of making money for a company. If an employee isn’t needed, they’re not hired. If they cost more to keep on than what they’re producing, they’re let go. If needed, they’re paid the wage they’re worth in the market (fast food – very little; expert in his/her field – a lot). If an employee has value in the free market, and is not paid enough, another business will – not because they’re nicer than the other company, but for the purpose of making more money for the company.

      The problem is corporate welfare (a form of fascism), and manipulation of the free market. It has absolutely nothing to do with businesses “having” to pay a certain wage.

      • Fulton F Fortner

        If our labor unions were stronger, wages would improve. If our people were smarter, unions would be stronger.

    • mllyjul

      People are free to work anywhere they like. If they don’t like the wages of one company, they can work for another. People are never “forced” to collect welfare payments from the government and most that do, do not WORK! You are an imbecile. McDonalds does not direct it’s employees to apply for welfare.

      • RalphKramden

        Does McDonalds not direct its employees to collect welfare? What a horse’s ass you are. McDonalds forces people into the welfare system by not providing a “livable’ wage, forcing people to work 32 hours so that the corporation does not have to pay any benefits, including, including, getting a free meal as a perk for a shift. I had to pay for my friends meal because she was not entitled to a lousy hamburger—she was working less than 8 hours.
        “People are free to work anywhere they like.” This is the stuff that created Ebenezer Scrooge: this sorry, basket-case country of ours, after 230-odd years, we have the largest penal colony in the world (4 times that of China,) most of us work part-time (52%,) and we have a huge unemployment rate, much larger than the official one because it does not count those who no longer look for work, and we have to deal with the scepter of medical bankruptcy. You worshippers of Ayn Rand are a bunch of hypocrites just as she was—she got free schooling, collected Social Security and Medicaid. Ask Rand Paul if he gets health benefits from the tax payers?

        • mllyjul

          You are a moron! You are either willfully ignorant or a liar. McDonalds DOES NOT DIRECT ITS employees to COLLECT WELFARE. The wages at a fast food restaurant are commensurate with the work done. If you want to make more money, do something else. NO ONE IS FORCING you to work 32 hours! Get another job or a 2nd job if you want more money. You act as though it is other people’s responsibility to take care of you. Grow up. You can get a catastrophic health insurance plan to cover yourself in the event of a major illness or accident, they are not that expensive. You are dealing fallacies with your talking points about medical bankruptcies. If you don’t like your situation in life, improve it and stop whining that other people are creating your situation and therefore OWE YOU SOMETHING. NO ONE OWES YOU ANYTHING.

    • mllyjul

      You are a useful idiot of the progressive left.

  • rogerfgay

    First, get rid of the term “corporate welfare.” It’s misleading and makes you sound like a stupid hugger of diseased trees. We now have the well-established term “cronyism” that sets us on the road to the core problem of political corruption. Then, found out how much of what is spent on “social welfare” is actually cronyism / overhead / political corruption.

  • blasater

    I would like to see how they came up with that 70 billion number. CBO says it is a lot less than that.

  • Owen Kellogg

    It’s high time that Atlas finally shrugs. But forget about John Galt. Who is Atlas?

  • Kealii Na Kolenekeo

    actually in accordance to governments finance committee corporate, welfare subsidies will increase to $154 Billion by the end of 2014 that, will triple the amount compared to social welfare. It’s time for stronger representation and legislation to make these changes keep, in mind if you’re adjusting the cost of these figures do not rely on present calculations from the CBO their, final analysis will always be adjusted 35 to 60 days later..

    Our current infrastructure, schools, first responders; fire, police, EMT’s etc, health benefits to our military veterans, increasing subsidies for the poor with food stamps, unemployment benefits to struggling Americans, highways, bridges and the thousands of structures are in dire need of maintenance.

    Should both parties decide to work together instead of being asinine moron’s and put politics aside, we as a nation can progress to greater heights or keep being idiots while the rest of the world laughs at us.

    Further changes is to implement a much stronger legislation to protect our environment restricting Oil companies from Fracking, reducing and restricting gun laws to protect everyone with, wise and smart regulations or our society will be bare the next domestic terrorist group.

    • mllyjul

      Really? I am curious why the author of this article used such an old figure, from 2006? Another article on this website puts the 2011 (far more current) total welfare payments at 1.028 trillion dollars covering a total of 83 welfare programs. Further, since obama has been in office there has been a huge number of subsidies to “green energy” companies, most of which are now bankrupt all at the taxpayers expense.The author leaves that out. Also, what specifically has the federal government done to “subsidies” oil and coal. I know oil companies pay huge sums of taxes to the federal government, but I am not aware of any subsidies.

    • mllyjul

      Spoken like a true useful idiot of the progressive left.

      • Kealii Na Kolenekeo

        facts hurts while, your bullcrap from the right goes no where moron

      • Charly Voisine

        I have a good description of mllyjul, but it’s not appropriate.

  • mllyjul

    I am curious why the author of this article used such an old figure, from 2006? Another article on this website puts the 2011 (far more current) total welfare payments at 1.028 trillion dollars covering a total of 83 programs. Further, since obama has been in office there has been a huge number of subsidies to “green energy” companies, most of which are now bankrupt. The author leaves that out. Also, what specifically has the federal government done to “subsidies” oil and coal. I know oil companies pay huge sums of taxes to the federal government, but I am not aware of any subsidies.

    • wiseoldsnail

      if you’re going to claim that most ‘green energy’ companies that received subsidies ‘are now bankrupt’ please offer evidence . then, to be fair and balanced, please also compare that to the now bankrupt oil companies which received subsidies … and the amounts of the subsidies

      • mllyjul

        Do your own research. The bankrupt “green” energy companies have been in the news, easily found on the internet, look it up. Do you read anything other than left wing talking points? And since you are all into fair and balanced, why don’t you look up how many billions of dollars oil companies pay in taxes every year.

        • Bob Pineo

          Typical bagger response… Make some BS comment, then when called on it they refuse to back it up. Usual response, look it up.

          • mllyjul

            Typical useful idiot of the progressives left, too stupid to look at facts that don’t agree with your agenda, too lazy to research anything, and need to be spoon fed everything like the little children they are.

          • SEN

            Actually the program hasn’t been unsuccessful. Do some research you knob. Here is somewhere to start

          • mllyjul

            Actually “knob” billions have been lost to obamas green energy boondoggles. Do some research yourself.

          • RalphKramden

            Yes, you are absolutely right, Reagan taking down the solar panels explains everything you corporate-puppets believe in. We subsidize $12 billion a year (those of us who pay taxes, not GE) for corporate dining-and-wining. But hate Obama, he is the lackey of Wall St.

          • mllyjul

            What are you talking about with your Reagan comment? Your comment is incoherent? What are you a puppet of? “green energy”, “carbon footprint”, “climate change” propaganda? Obama is certainly a crony capitalist, that is for certain.

    • wiseoldsnail

      and please be sure to include the costs to government (us all) in the form of toxic cleanup due to corporate polluting