As the American and European economies struggle, one of the few bright spots is the ongoing innovation and free-market expansion in technology industries. Thank goodness we have entrepreneurial companies such as Apple and Google generating economic growth and providing exciting opportunities for young people.
House Oversight and Government Reform Committee chairman Darrell Issa (R-CA) released a report today on failed mortgage company Countrywide’s use of a VIP loan program to curry favor with Beltway decision-makers. Members of Congress, congressional staffers, and cabinet officials received preferential treatment – including rate discounts and fee waivers – from Countrywide.
Corporate welfare is a bipartisan problem, and it’s a problem at both the federal and state level. Yesterday, I discussed the recent demise of Obama-subsidized Abound Solar and the fact that Indiana Republicans were also involved in helping the company obtain taxpayer handouts. Adding insult to injury is another example of “crony capitalism” gone awry in Indiana.
Solyndra received some company late last week when Abound Solar filed for bankruptcy and announced that it was shutting down operations. Abound, which received $70 million from taxpayers, is the third company backed by a Department of Energy loan program to go belly up.
The Community Development Block Grant program is a perfect example of the blurring of responsibility between the federal government and the states. The program’s roots go back to the Great Society and the wishful belief that the problems of urban Americans could be solved with handouts from Washington. Instead, the program “has degenerated into a federal slush fund for pet projects of local politicians and politically connected businesses.”
With the Supreme Court ruling on President Obama’s health care law, everyone is wondering what’s next for big government. Here are some ideas for federal policymakers to consider:
The $200 million Essential Air Service program subsidizes airlines to provide service to rural communities. The program, which was supposed to be temporary, was created when the federal government deregulated the airlines in 1978. As is usually the case with a “temporary” government program, EAS subsidies have become a permanent handout.
Several weeks ago, 127 House Republicans joined 155 Democrats to defeat an amendment introduced by Rep. Dennis Kucinich (D-OH) and Rep. Tom McClintock (R-CA) that would have shut down the Department of Energy’s Title 17 loan guarantee program. That’s the program that gave birth to Solyndra, which has come to symbolize the failure of the Obama administration’s crony capitalist policies.
The Senate passed a nearly $1 trillion farm bill last week that would maintain the farming industry’s dependency on taxpayers and keep food stamp spending at permanently elevated levels. Although the bill’s supporters claim that it amounts to major “reform,” the reality is that it’s just bipartisan big government business-as-usual.
Whoops! Federal Reserve economists looked in the shoe closet recently and discovered more than half a trillion dollars of government bond debt that they hadn’t previously counted.