Welfare Is Cause of the Fiscal Crisis . . . Corporate Welfare

[This article in the LA Times calls into question the fundamental reasoning behind giving money incentives to corporations -- otherwise they'll go someplace else.  But when you add up all the tax incentives given to corporations, it is child's play to fix the education budget deficit in every state -- a lesson we should apply, for example, to the crisis in Springfield, Illinois (and the city of Chicago to boot).  Thanks to Lorraine Suzuki for calling it to our attention -- Lew Rosenbaum]

Corporate welfare and California’s budget deficit

  • Michael Hiltzik

The government handouts include tax breaks for businesses and incentives for some of the state’s largest industries.

By Michael Hiltzik  June 18, 2010 | 6:34 p.m.

I believe we can all agree on the root cause of the state’s $20-billion budget gap.

It’s welfare: all those millions of taxpayer dollars going to recipients who line up for their government handouts instead of competing in the marketplace on a level playing field like the rest of us, who don’t pay their fair share of taxes and who get protected by a politically powerful lobby.

Yes, I’m talking about the business community.

[FOR THE RECORD: The column incorrectly states that $1 billion in revenues from a state oil severance tax would   benefit 1 billion children in the CalWORKS program. As the column states elsewhere, the correct figure is more than 1 million children.]

For all the hand-wringing by Gov. Arnold Schwarzenegger about how there’s almost nothing left to cut in the state budget except services to children, the aged and the destitute, hundreds of millions of dollars are spent every year on handouts to business. That’s despite the lack of evidence that some of these programs keep employers in the state, lure employers from out of state or are cost-effective in any general way.

The governor is asking the Legislature to take such draconian steps as eliminating CalWORKS, the state’s principal family welfare program (serving 1.1 million children), and downsizing child care and mental health programs.

Meanwhile, corporate welfare programs such as tax breaks for some of our largest companies and “incentives” for our largest industries are to survive. To his credit, Schwarzenegger has proposed delaying some new corporate tax breaks.

The state budget is rife with industry goodies. For example, there’s the Hollywood subsidy, currently pegged at $100 million a year in tax credits.

The rationale for this welfare program is to keep productions from fleeing to other states, taking California jobs with them. But you could go blind looking for an independent study, as opposed to studies funded by the state film commissions handing out the dough, showing that such programs produce more in overall benefits than they cost.

Quite the contrary — according to Governing magazine, New Mexico, which had aggressively courted producers with $40 million in tax rebates, concluded in 2008 that for every dollar it spent, it received 14.4 cents in return.

No one knows to what extent the production companies pocketing California’s cash would have filmed here anyway. And the program is hardly aimed at companies on the financial edge — as my colleague Richard Verrier reported recently, $20 million is going to pictures being shot here this year by Warner Bros. The money isn’t allocated according to need but on a first-come, first-served basis among qualified productions, the California Film Commission says. In other words, it’s more a windfall for the nimblest applicants than a program targeted at productions most likely to leave without it. [Click here to read the entire article}

Chicago Sun Times: Karen Lewis Is For Real

[The following profile of Karen Lewis is indeed revealing in the details of her background.  But those who have been reading Substance News and have attended CORE programs and meetings are not surprised.  And we're glad to see that Sun Times readers throughout the city will have an opportunity to find out about Karen too.  One thing that we'd like to emphasize:  the hardest task is just beginning  -- Lew Rosenbaum]

Chicago’s new ‘electric’ teachers union president

KAREN LEWIS | Never hesitated to switch gears to take a chance — and now comes her biggest challenge

June 19, 2010

BY ROSALIND ROSSI Education Reporter

The career trajectory of Karen Lewis proves that the route to the top does not always reflect the shortest distance between two points.

The president-elect of the Chicago Teachers Union left Kenwood High School in 1970 without a diploma, skipping right from her last day of junior year to a prestigious university, and eventually graduated — “thank-you laude,” as she puts it — from Dartmouth College.

Chemistry teacher Karen Lewis cleans up the Chem Lab at King College Prep High School.
(Brian Jackson/Sun-Times)

Karen Jennings Lewis (back row, second from left) is pictured in the 1970 Kenwood High School yearbook.


A pianist and opera buff, she began college with the dream of becoming a symphony conductor because, she says, “I liked being in charge.” A trip to Barbados changed her life, and she entered medical school intent on becoming a physician on the island paradise. She dropped out instead, turned to substitute teaching to support herself, and found her calling.

Funny, bubbly and even “brilliant” by some accounts, the 56-year-old Lewis is not afraid to switch gears to pursue a passion — to take a chance, to dive into a challenge. She has had more jobs than she has salmon-frosted, manicured fingernails.

On July 1, Lewis will begin the challenge of her life when she assumes the mantle of president of the nation’s third-largest teachers union. [Click here to read more]

WARNING: Coal Pollutes Chicago Neighborhoods

Warning Signs: Awareness Campaign Targets Coal Burning Power Plants in Chicago

Posted June 16, 2010 by Nicolas Lampert

RAN Chicago teamed up with local artists to raise public attention to the Fisk and Crawford coal-powered plants on Chicago’s near south side that have been poisoning the air for decades. Both Plants are located in highly populated neighborhoods – primarily Latino neighborhoods – and have operated with outdated equipment and safety standards that has made Chicago one of the worst cities for air quality in the US. Exposure to these plants has led to an average of 40 deaths a year and high rates of asthma and other upper respiratory ailments. The kicker is that these plants do not even benefit Chicago residents. Most of the power produced is sold on the open grid to Ohio and Pennsylvania while community residents (not to mention the ozone layer) suffers, while company execs get rich.

Local groups - LVEJO (Little Village Environmental Justice Organization), PERRO (Pilsen Environmental Rights and Reform Organization), RAN Chicago, and others are calling for the plants to be closed and for the end of burning fossil fuels as an energy source.  (see  Just Seeds web site)

Road from Chicago . . . to Detroit. Monday June 21st

June 21st Kick Off the Road to Detroit!

CHICAGO FOR THE PEOPLE MARCH:

Taking Back Our City!

Meeting point:
12 pm, Cabrini Green

Stanton Park, 618 W. Scott St
(BBQ & Freedom Caravan Potluck)

March Begins:
2pm March to City Hall

& Rally at 3pm, 121 N. Lasall
e

Join our event page on facebook: http://www.facebook.com/event.php?eid=123618587678259

Over 300 people from different delegations traveling to the Social Forum to Detroit will be stopping in our city on June 21. Join us, as we share a meal and march to City Hall to deliver the people’s demands:
Education, Housing, Health and Jobs!
Together, we protest:

  • mental health clinics facing closure/privatization
  • displacement of public housing residents and rising fore closures
  • education privatization
  • the lack of quality jobs
and then at night we party for the people!!!

Humbolt park concert begins @ 6pm (Division and Washtenaw)

More Info: http://www.facebook.com/event.php?eid=118533351507034&index=1

Interested in volunteering?
email Stacy at peachtree522@yahoo.com with the subject line: volunteer for June 21

Follow

Get every new post delivered to your Inbox.

Join 32 other followers