Ten favors for Big Business
The state’s bias for big business consists of ten privileges, three familiar ones and seven subtle ones.
The three better known favors are
- subsidies, such as the millions of tax dollars the US gives MacDonald’s to advertise its hamburgers in Paris,
- “sweetheart” contracts, such as those between the US and the weapons industry which charges the military $400 for a toilet seat, and
- tax breaks, such as the US deduction for investing in new machinery but not in retraining workers, or tariffs that protect General Motors but not the wages of the workers of GM.
The seven subtle favors are permits granted at far below market value:
- the corporate charter which limits the liability of management and investors and is worth billions of dollars to those businesses putting people and planet at risk. When the charter is not enough of a shield, the state further reduces the liability of responsible parties. When Y2K was an unknown factor, the US passed a law that sheltered Microsoft and other software giants from any possible suits from unhappy customers.
- the waivers from, or weak enforcement of, existing standards. First the US set air pollution standards at the convenience of the automobile industry, then continually pushes back the deadline to meet these standards. Again, the US set background radiation standards at the convenience of the nuclear industry, then looks the other way when a nuclear power plant fails to comply. Non-enforcement of air quality standards alone (never mind other pollutants) is worth $300 to $500 billion annually.
- the franchises that states in America grant to corporations to provide electricity, phone service, etc. In these natural monopolies, there is little or no competition, so the state is supposed to keep profits low. In reality, they are very high. The uncollected market value of franchises is again in the billons. The next four permits grant ownership or control over parts of nature (which includes logical structures), the heritage of us all.
- the patents that are supposed to protect inventors but are used to create monopolies for investors. For example, the US pays for research in medicine then when a new drug is developed, grants the company a patent without recovering any of the cost of the research. The US grants Microsoft a monopoly via patents and copyrights while at the same time accusing Bill Gates of acting like a monopolist. The uncollected value of patents for industry and technology are several hundred billion dollars each year.
- the licenses that the US grants to TV, radio, and cell phone networks turn part of nature, the electromagnetic spectrum, into virtual private property. Sometimes the US auctions off some of the spectrum but the most lucrative part – TV wavelength – it gives away for free. TV networks turn around and charge advertisers a million dollars a minute on Superbowl Sunday. All these licenses are worth at least a hundred billion dollars every year.
- the leases that the US grants to corporations that mine ores or raise cattle show just how bad the state defends the interest of the people. One corporation paid $10 thousand for a mining claim worth $10 billion. The huge cattle ranches not only pay government much less than private landowners charge them, they also damage the grazing lands before they move on to the next pasture. The full value for these “fire-sale” leases is again in the billions annually.
- the titles to land and resources that counties in the US grant to owners do little to protect small homeowners who, by paying mortgages their entire careers, are actually tenants to the bank. What titles really do is blind the middleclass to this reality, to their actual station in life as perpetual debtors to the lending institutions. Americans spend trillions on titles each year.
It’s our country. Why not charge rent?