President Clinton and more than a few bipartisan allies in Congress are all too willing to lavish welfare goodies on corporations, even as the government clamps down on individual welfare dependants.
The White House especially targets electoral-rich California high-tech firms for government largesse. This is why it's heartening to learn that 79 top Silicon Valley executives have signed a "Declaration of Independence from Corporate Welfare."
Cypress Semiconductors Chief Executive Officer T.J. Rodgers, on behalf of the other CEOs, declares in a briefing paper prepared for the Cato Institute that corporate welfare programs worth $65 billion a year "harm U.S. industry in general and Silicon Valley in particular."
"Technology subsidies to corporations," he writes, "are sold using techno-babble to camouflage unjustifiable investments, which typically fall into four categories: subsidizing the rich, competing unfairly with private industry, spending that provides no benefit, and spending that hurts the intended beneficiary."
Proponents claim that American subsidy programs are necessary because Japan and Europe subsidize their corporations, but Rodgers notes "Japan's programs have been consistent losers, (and) Western Europe's socialized economies are among the least healthy on the planet."
"The truth is," adds Rodgers, that Silicon Valley firms would be mostly unscathed if they lost all federal subsidies." He explains: "Whenever a dollar is transferred... to Washington, that dollar's chances of being invested productively diminish greatly."
"Our government has taken several hundred million of taxpayers' dollars to subsidize an exotic technology manufactured in an exotic place for a super-high-tech industry that neither needs nor cares about the investment," writes Rodgers.
The CEOs know it won't be easy to eliminate corporate welfare, so they recommend a very good idea the Congress ought to put on the front burner: Establish an independent commission, similar to the military base-closing panel, to identify substantial government spending cuts in the area of corporate welfare.