It's time to end corporate welfare as we know it

by Ralph Nader

The issue of concentration of power and the growing conflict between the civil society and the
corporate society is not a conflict that you read about or see on television. So unfortunately, most of us
grow up corporate; we don't grow up civic.
If I utter the following words, what images come to mind: crime, violence, welfare and addictors?
What comes to mind is street crime; people lining up to get their welfare checks; violence in the streets;
and drug dealers -- the addictors.
And yet, by any yardstick, there is far more crime, and far more violence, and far more welfare
disbursement (and there are far more addictors) in the corporate world than in the impoverished street
arena.
The federal government's corporate welfare programs number over 120. They are so varied and
embedded that we actually grow up thinking that the government interferes with the free enterprise
system. rather than subsidizing it.
It's hard to find a major industry today whose principal investments were not first made by the
government -- in aerospace, telecommunications, biotechnology and agribusiness. Government
research and development money funds the drug and pharmaceutical industry. Government research
and development funds are given freely to corporations, but they don't announce it in ads the next day.
Corporate welfare has never been viewed as debilitating. Nobody talks about imposing workfare
requirements on corporate welfare recipients or putting them on a program of "two years and you're
out." Nobody talks about aid to dependent corporations. It's all talked about in terms of "incentives."
At the local community level, in cities that can't even refurbish their crumbling schools -- where
children are without enough desks or books -- local governments are anteing up three, four, five
hundred million dollars to lure very profitable baseball, football and basketball sports moguls who don't
want to share the profits. Corporate sports are being subsidized by cities.
Corporations have perfected socializing their losses while they capitalize on their profits. There was the
savings-and-loan debacle -- and you'll be paying for that until the year 2020. In terms of principal and
interest, it was a half-trillion-dollar bailout of 1,000 savings-and-loans banks. Their executives looted,
speculated and defrauded people of their savings -- and then turned to Washington for a bailout.
Foreign and domestic corporations can go on our land out West. If they discover gold, they can buy the
acreage over the gold for no more than $5 an acre. That's been the going rate since the Mining Act of
1872 was enacted. That is taking inflation-fighting too far.
There's a new drug called Taxol to fight ovarian cancer. That drug was produced by a grant of $31
million of taxpayer money through the National Institutes of Health, right through the clinical testing
process. The formula was then given away to the Bristol-Myers Squibb company. No royalties were
paid to the taxpayer. There was no restraint on the price. Charges now run $10,000 to $15,000 per
patient for a series of treatments. If the patients can't pay, they go on Medicaid, and the taxpayer pays at
the other end of the cycle, too.
Yet what is the big issue in this country and in Washington when the word "welfare" is spoken? It is the
$300 monthly check given a welfare mother, most of which is spent immediately in the consumer
economy. But federal corporate welfare is far bigger in dollars. At the federal, state and local levels
there is no comparison between the corporate welfare and poverty welfare programs.
We have 179 law schools and probably only 15 of them (and only recently) offer a single course or
seminar on corporate crime. You think that's an accident? Law school curricula are pretty much shaped
by the job market, and if the job market has slots in commercial law, bankruptcy law, securities and
exchange law, tax law or estate planning law, the law schools will oblige with courses and seminars.
One professor studying corporate crime believes that it costs the country $200 billion a year. And yet
you don't see many congressional hearings on corporate crime. You see very few newspapers focusing
on corporate crime.
Yet 50,000 lives a year are lost due to air pollution, 100,000 are lost due to toxics and trauma in the
workplace, and 420,000 lives are lost due to tobacco smoking. The corporate addictor has a very
important role here, since it has been shown in recent months that the tobacco companies try to hook
youngsters into a lifetime of smoking from age 10 to 15.
When you grow up corporate, you don't learn about the reality of corporate welfare. The programs that
shovel huge amounts of taxpayer dollars to corporations through inflated government contracts via the
Pentagon, or through subsidies, loan guarantees, giveaways and a variety of clever transfers of taxpayer
assets get very little attention.
Knowing What's Ours
We grow up never learning what we own together, as a commonwealth. If somebody asks you what
you and your parents own, you'd say: homes, cars and artifacts. Most of you would not say that you are
owners of the one-third of America that is public land or that you are part owners of the public
airwaves.
When you ask students today who owns the public airwaves you get the same reply -- "the networks,"
or maybe "the government." We own the public airwaves and the Federal Communications
Commission is our real estate agent. The radio and TV stations are the tenants who are given licenses to
dominate their part of the spectrum 24 hours a day, and for four hours a day they decide who says what.
You pay more for your auto license than the biggest TV station pays for its broadcast license. But if
you, the landlord, want in on its property, the radio and TV stations say, "Sorry, you're not going to
come in." These companies say they've got to air trash TV-- sensual TV, home shopping and rerun
movies.
We have the greatest communications system in the world and we have the most demeaning subject
matter and the most curtailed airing of public voices (known in the trade as the "sound bite"). The
sound bite is down to about five seconds now.
You and your parents also may be part owners of $4 trillion in pension funds invested in corporations.
The reason this doesn't get much attention is that although we own it, corporations control it.
Corporations, banks and insurance companies invest our pension money. Workers have no voting
mechanism regarding this money. If they did, they'd have a tremendous influence over corporations that
have major pension trust investments.
Not controlling what we own should be a public issue, because if we begin to develop control of what
we own, we will marshal vast existing assets that are legally ours for the betterment of our society. That
will not happen unless we talk about why people don't control what they own.
All of the reforms require a rearrangement of how we spend our time. The women who launched the
women's right-to-vote movement decided to spend time -- in the face of incredible opposition. The
people who fought to abolish slavery also decided to spend time. The workers who formed trade unions
gave time.
The Power of Civic Action
Historically, how have we curbed corporate power? By child labor prohibition, by occupational health
and safety rules, by motor vehicle standards and food and drug safety standards. But the regulatory
agencies in these areas are now on their knees. Their budgets are very small -- far less than 1 percent of
the federal budget.
Their job is to put the federal cop on the corporate beat against the illegal dumping of toxics. But these
laws do not get high compliance by corporations, and the application of regulatory law and order
against corporate crime, fraud, abuse and violence is at its lowest ebb. I've never seen some of these
agencies as weak as they are now. President Ronald Reagan started it and President George Bush
extended it. And now we have "George Ronald Clinton" making the transition very easy.
The dismantling of democracy is perhaps now the most urgent aspect of the corporatization of our
society. And notice, if you will, two pillars of our legal system -- tort law and contract law.
The principle of tort law is that if you are wrongfully injured, you have a remedy against the
perpetrator. That's well over 200 years old. And now, in state legislatures and in Congress, laws have
been passed, or are about to be passed, that protect the perpetrators, the harm-doers -- that immunize
them from their liability.
When the physicians at the Harvard School of Public Health testify that about 80,000 people die in
hospitals every year from medical malpractice -- a total larger than the combined fatalities in motor
vehicle accidents, homicides and death by fire each year in the US -- it raises the issue of why our
elected representatives are vigorously trying to make it more difficult for victims of medical
malpractice to have their day in court.
As in the Middle Ages, 1 percent of the richest people in this country own 90 percent of the wealth. The
unemployment rate doesn't take into account the people who looked for a job for six months and gave
up, and it doesn't take into account the underemployed who work 20 hours a week. Part of growing up
corporate is that we let corporations develop the yardsticks by which we measure the economy's
progress.
Democracy is the best mechanism ever devised to solve problems. That means the more we refine it --
the more people practice it, the more people use its tools -- the more likely it is we will not only solve
our problems or at least diminish them, we also will foresee and forestall risk levels. When you see
corporations dismantling democracy, you have to take it very seriously and turn it into a public political
issue.
Among the five roles that we play, one is voter-citizen, another is taxpayer, another is worker, another
is consumer and another is shareholder through worker pension trusts. These are critical roles in our
political economy. Yet they have become weaker and weaker as the concentration of corporate power
over our political and cultural and economic institutions has increased year by year.
We're supposed to have a government of, by and for the people. Instead we have a government of the
Exxons, by the General Motors and for the DuPonts. We have a government that recognizes the rights
and liabilities and privileges of corporations, which are artificial entities created by state charters,
against the rights and privileges of ordinary people.
Jefferson warned us that the purpose of representative government is to counteract "the excesses of the
monied interests"-- then the merchant class; now the corporations. Beware of the government that
doesn't do that.
Adapted from a longer version published by The Washington Spectator [The Public Concern
Foundation, Inc., London Terrace Station, PO Box 20065, New York, NY 10011. Subscriptions:
$15/year for 22 issues]. Nader's 390-page handbook, Civics for Democracy, is available for $17.95
from Essential Information, PO Box 19405, Washington, DC 20036.
Ralph Nader, a pioneering consumer advocate who calls himself "a small 'd' democrat," is the Green
Party candidate for president. This essay is excerpted from a speech Nader delivered at Pennsylvania's
Haverford College.

by Ralph Nader
The issue of concentration of power and the growing conflict between the civil society and the
corporate society is not a conflict that you read about or see on television. So unfortunately, most of us
grow up corporate; we don't grow up civic.
If I utter the following words, what images come to mind: crime, violence, welfare and addictors?
What comes to mind is street crime; people lining up to get their welfare checks; violence in the streets;
and drug dealers -- the addictors.
And yet, by any yardstick, there is far more crime, and far more violence, and far more welfare
disbursement (and there are far more addictors) in the corporate world than in the impoverished street
arena.
The federal government's corporate welfare programs number over 120. They are so varied and
embedded that we actually grow up thinking that the government interferes with the free enterprise
system. rather than subsidizing it.
It's hard to find a major industry today whose principal investments were not first made by the
government -- in aerospace, telecommunications, biotechnology and agribusiness. Government
research and development money funds the drug and pharmaceutical industry. Government research
and development funds are given freely to corporations, but they don't announce it in ads the next day.
Corporate welfare has never been viewed as debilitating. Nobody talks about imposing workfare
requirements on corporate welfare recipients or putting them on a program of "two years and you're
out." Nobody talks about aid to dependent corporations. It's all talked about in terms of "incentives."
At the local community level, in cities that can't even refurbish their crumbling schools -- where
children are without enough desks or books -- local governments are anteing up three, four, five
hundred million dollars to lure very profitable baseball, football and basketball sports moguls who don't
want to share the profits. Corporate sports are being subsidized by cities.
Corporations have perfected socializing their losses while they capitalize on their profits. There was the
savings-and-loan debacle -- and you'll be paying for that until the year 2020. In terms of principal and
interest, it was a half-trillion-dollar bailout of 1,000 savings-and-loans banks. Their executives looted,
speculated and defrauded people of their savings -- and then turned to Washington for a bailout.
Foreign and domestic corporations can go on our land out West. If they discover gold, they can buy the
acreage over the gold for no more than $5 an acre. That's been the going rate since the Mining Act of
1872 was enacted. That is taking inflation-fighting too far.
There's a new drug called Taxol to fight ovarian cancer. That drug was produced by a grant of $31
million of taxpayer money through the National Institutes of Health, right through the clinical testing
process. The formula was then given away to the Bristol-Myers Squibb company. No royalties were
paid to the taxpayer. There was no restraint on the price. Charges now run $10,000 to $15,000 per
patient for a series of treatments. If the patients can't pay, they go on Medicaid, and the taxpayer pays at
the other end of the cycle, too.
Yet what is the big issue in this country and in Washington when the word "welfare" is spoken? It is the
$300 monthly check given a welfare mother, most of which is spent immediately in the consumer
economy. But federal corporate welfare is far bigger in dollars. At the federal, state and local levels
there is no comparison between the corporate welfare and poverty welfare programs.
We have 179 law schools and probably only 15 of them (and only recently) offer a single course or
seminar on corporate crime. You think that's an accident? Law school curricula are pretty much shaped
by the job market, and if the job market has slots in commercial law, bankruptcy law, securities and
exchange law, tax law or estate planning law, the law schools will oblige with courses and seminars.
One professor studying corporate crime believes that it costs the country $200 billion a year. And yet
you don't see many congressional hearings on corporate crime. You see very few newspapers focusing
on corporate crime.
Yet 50,000 lives a year are lost due to air pollution, 100,000 are lost due to toxics and trauma in the
workplace, and 420,000 lives are lost due to tobacco smoking. The corporate addictor has a very
important role here, since it has been shown in recent months that the tobacco companies try to hook
youngsters into a lifetime of smoking from age 10 to 15.
When you grow up corporate, you don't learn about the reality of corporate welfare. The programs that
shovel huge amounts of taxpayer dollars to corporations through inflated government contracts via the
Pentagon, or through subsidies, loan guarantees, giveaways and a variety of clever transfers of taxpayer
assets get very little attention.
Knowing What's Ours
We grow up never learning what we own together, as a commonwealth. If somebody asks you what
you and your parents own, you'd say: homes, cars and artifacts. Most of you would not say that you are
owners of the one-third of America that is public land or that you are part owners of the public
airwaves.
When you ask students today who owns the public airwaves you get the same reply -- "the networks,"
or maybe "the government." We own the public airwaves and the Federal Communications
Commission is our real estate agent. The radio and TV stations are the tenants who are given licenses to
dominate their part of the spectrum 24 hours a day, and for four hours a day they decide who says what.
You pay more for your auto license than the biggest TV station pays for its broadcast license. But if
you, the landlord, want in on its property, the radio and TV stations say, "Sorry, you're not going to
come in." These companies say they've got to air trash TV-- sensual TV, home shopping and rerun
movies.
We have the greatest communications system in the world and we have the most demeaning subject
matter and the most curtailed airing of public voices (known in the trade as the "sound bite"). The
sound bite is down to about five seconds now.
You and your parents also may be part owners of $4 trillion in pension funds invested in corporations.
The reason this doesn't get much attention is that although we own it, corporations control it.
Corporations, banks and insurance companies invest our pension money. Workers have no voting
mechanism regarding this money. If they did, they'd have a tremendous influence over corporations that
have major pension trust investments.
Not controlling what we own should be a public issue, because if we begin to develop control of what
we own, we will marshal vast existing assets that are legally ours for the betterment of our society. That
will not happen unless we talk about why people don't control what they own.
All of the reforms require a rearrangement of how we spend our time. The women who launched the
women's right-to-vote movement decided to spend time -- in the face of incredible opposition. The
people who fought to abolish slavery also decided to spend time. The workers who formed trade unions
gave time.
The Power of Civic Action
Historically, how have we curbed corporate power? By child labor prohibition, by occupational health
and safety rules, by motor vehicle standards and food and drug safety standards. But the regulatory
agencies in these areas are now on their knees. Their budgets are very small -- far less than 1 percent of
the federal budget.
Their job is to put the federal cop on the corporate beat against the illegal dumping of toxics. But these
laws do not get high compliance by corporations, and the application of regulatory law and order
against corporate crime, fraud, abuse and violence is at its lowest ebb. I've never seen some of these
agencies as weak as they are now. President Ronald Reagan started it and President George Bush
extended it. And now we have "George Ronald Clinton" making the transition very easy.
The dismantling of democracy is perhaps now the most urgent aspect of the corporatization of our
society. And notice, if you will, two pillars of our legal system -- tort law and contract law.
The principle of tort law is that if you are wrongfully injured, you have a remedy against the
perpetrator. That's well over 200 years old. And now, in state legislatures and in Congress, laws have
been passed, or are about to be passed, that protect the perpetrators, the harm-doers -- that immunize
them from their liability.
When the physicians at the Harvard School of Public Health testify that about 80,000 people die in
hospitals every year from medical malpractice -- a total larger than the combined fatalities in motor
vehicle accidents, homicides and death by fire each year in the US -- it raises the issue of why our
elected representatives are vigorously trying to make it more difficult for victims of medical
malpractice to have their day in court.
As in the Middle Ages, 1 percent of the richest people in this country own 90 percent of the wealth. The
unemployment rate doesn't take into account the people who looked for a job for six months and gave
up, and it doesn't take into account the underemployed who work 20 hours a week. Part of growing up
corporate is that we let corporations develop the yardsticks by which we measure the economy's
progress.
Democracy is the best mechanism ever devised to solve problems. That means the more we refine it --
the more people practice it, the more people use its tools -- the more likely it is we will not only solve
our problems or at least diminish them, we also will foresee and forestall risk levels. When you see
corporations dismantling democracy, you have to take it very seriously and turn it into a public political
issue.
Among the five roles that we play, one is voter-citizen, another is taxpayer, another is worker, another
is consumer and another is shareholder through worker pension trusts. These are critical roles in our
political economy. Yet they have become weaker and weaker as the concentration of corporate power
over our political and cultural and economic institutions has increased year by year.
We're supposed to have a government of, by and for the people. Instead we have a government of the
Exxons, by the General Motors and for the DuPonts. We have a government that recognizes the rights
and liabilities and privileges of corporations, which are artificial entities created by state charters,
against the rights and privileges of ordinary people.
Jefferson warned us that the purpose of representative government is to counteract "the excesses of the
monied interests"-- then the merchant class; now the corporations. Beware of the government that
doesn't do that.
Adapted from a longer version published by The Washington Spectator [The Public Concern
Foundation, Inc., London Terrace Station, PO Box 20065, New York, NY 10011. Subscriptions:
$15/year for 22 issues]. Nader's 390-page handbook, Civics for Democracy, is available for $17.95
from Essential Information, PO Box 19405, Washington, DC 20036.
Ralph Nader, a pioneering consumer advocate who calls himself "a small 'd' democrat," is the Green
Party candidate for president. This essay is excerpted from a speech Nader delivered at Pennsylvania's
Haverford College.

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