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What corporate welfare looks like:

jilevin
Here is what corporate welfare looks like: http://t.co/pgI6M8OKz7
1:07 AM Apr 13 2014

Stashed in: Economics!, America!, economics

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I think that just shows the government has a massive over-spending problem. When you're in a hole, stop digging.

Government spending in 1950 was $44 Billion of a really small GDP of 2.27 Trillion. 

Government spending in 2013 was $2.6 Trillion, with a deficit of $668 billion.  So they spent more than the total GDP of 1950, and only through massive growth restrictions on spending, did it fall below the previous three years Trillion dollar deficits. 

It took almost two decades to recover from the disastrous spending of the FDR administrations.

image-534a8a6119a4a-F9rY.png

5 of the last 6 years have been the largest spending deficits ever. 

So in the 1950s, when the entire world economy consisted primarily of the US, and jurisdiction shopping pretty much didn't exist, so there was basically nowhere for capital to escape to, the government managed to get a larger proportion of tax revenue from corporations.

Okay, let's reproduce that!  First, let's have a economy crippling financial shock... check... then, let's spend a decade concentrating the remaining capital into a tiny politically connected cabal... check... and next, "reinvigorate" the homeland with a globally destructive megawar, Да?...

From my perspective, all of these are true:

1. Corporations pay less tax than they should.

2. Government is spending more than it should.

3. The low interest rates benefited very few people who were already winning.

4. The wars the U.S. has engaged in have done us more harm than good.

And, worst of all,

5. There's so much inertia that it's almost impossible to reverse those 4 points.

The thing is.. it doesn't matter if corporations aren't paying their 'fair share', for one simple, practical, reason:  In a global economy, capital is fungible.  Until there's a global economic harmonization, which won't happen in our lifetimes (maybe our great-grandchildren.... maybe), there are always going to be jurisdictions willing and able to compete via preferential tax treatment.  No amount of neo-socialist whining is going to change that.

And the only other option is literally another global foreign war and obliterate the rest of the world's economies.

That's a good point. Every medium or big business has operations overseas to take advantage of preferential tax treatment. There's no way to force them to do otherwise.

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