Class Warfare

Most people assume the Republican Party is opposed to welfare and other forms of social spending. Various reasons are given including social programs being a form of class warfare redistributing wealth downward from the hardworking rich to the lazy poor. Are Republicans and their Dixiecrat/Blue Dog Democrat brethren really opposed to welfare? The facts are in the Federal Budget.

The Nuclear power industry cannot make a profit without the help of the American tax payer. The Nuclear Power Industry therefore gets $7.1 billion per year in profit subsidies. The federal government gives away nuclear research ($468 million per year), insurance subsidies in the event we have an American Chernobyl ($3 billion per year), uranium fuel enrichment ($2.3 billion per year), reprocessing spent fuel rods ($340 million per year), nuclear waste storage ($420 million per year), and nuclear plant decommissioning ($2.1 billion per year). Ask your Congressman if profit subsidies are his idea of capitalism?

The oil and gas industry is profit subsidized by tax payers to the tune of $2.4 billion per year. The Oil Depletion Allowance cost tax payer more than $1 billion per year by allowing oil companies to deduct an extra 15% from their gross income they derive from any oil or gas wells which remain in production no matter how long that well is active. If the price of oil drops below $20 per barrel, the deduction gets bigger. How would you like a 15% income tax break for staying employed? The Intangible Drilling Cost Deduction is another profit subsidy costing tax payers more than $500 million per year. Oil companies are allowed to deduct 70% of the cost of drilling a well in the first year. Over the next 5 years the remaining drilling cost can be deducted. If an oil company drills a dry hole, 70% of the cost of that dry hole can be written off. For the oil companies, failure is profitable. The Enhanced Oil Recovery Credit is another $500 million profit subsidy. This boondoggle allows oil companies to deduct from their bottom line the high cost of extracting oil from nearly depleted deposits. Write your Congressman and ask why we the tax payer should guarantee the super profits of the oil companies.

Mining Subsidies of $3.5 billion per year guarantee mining industry profits.The Mining Law of 1872 allowed the Canadian mining company, American Barrick, to extract $10 billion in gold from public lands in Nevada. American Barrick paid only $5,190 in lease fees and paid the American tax payer not one red cent in royalties. Chevron Oil company and Manville corporation paid $10,000 in lease fees to the American public and extracted $4 billion in platinum and palladium from their mining operations on public lands in Montana. They also paid no royalties to the American tax payer. Finally, the big corporate miners can deduct 85% of the projected mine exploration costs in the first year of the operation and they can treat the sale of coal, gold, iron ore, etc. as a capital gains and thereby pay less in income taxes. On the other hand, guess who gets to clean up the mining mess left behind? Ask your Congressman who is waging class warfare on whom?

And while you're at it, also ask your Congressman for a list of individuals, corporations, and foreign nations who own a million dollars or more of your national debt. Since it is you, the tax payer, who must pay back these trillions of dollars in national debt, don’t you want to know who has you on a leash? You will be surprised by his response!


May 2001

Corporate Welfare

During the month of November 1940, four months after its completion, the Tacoma Narrows Bridge, affectionately known by the locals as “Galloping Girdy,” spectacularly collapsed during a 40 mile per wind. Local officials were dumbfounded and after several unsuccessful attempts to explain the disaster, Theodore von Karman from the California Institute of Technology was called in to help. Von Karman was an expert in fluid dynamics (how liquids and gases move). Immediately Von Karman built a scale model of the Tacoma Narrows Bridge and placed the model in a wind tunnel. The scale model was accurate in every possible way including duplicating the tensile strength of the steel girders used to construct Galloping Girdy. After several months of testing, Von Karman concluded the cause of the bridge collapse was the 40 mile per wind. Like a window rattling when a helicopter flys over, or an opera singer breaking a wine glass with her voice, the Tacoma Narrows Bridge had a natural resonance frequency that matched a 40 mile per hour wind. The bridge simply rattled itself to pieces when the wind blew at precisely 40 miles per hour.

Before Von Karman, engineers never thought to use scale models to test their designs. Today civil engineers and especially aeronautical engineers use exact scale models in wind tunnels and a variety of other stressed environments to insure the air worthiness of their air planes and missiles.

Last week George W. Bush announced he was going to tear up the Anti- Ballistic Missile Treaty and build the antimissile defense shield known as “Star Wars.” The idea behind Star Wars is to build a “defensive” missile capable of shooting down an “offensive” missile. These offensive missiles typically move at about 25,000 miles per hour. Using the method of scaling pioneered by Theodore Von Karman, Star wars would be equivalent to shooting down a bullet with a bullet. Since the fastest bullets travel at no more than about 1,500 miles per hour, the task becomes even more difficult. To complicate matters, suppose the 25,000 mph bullet could release thousands of highly light reflecting BB’s designed to hide the bullet within the cloud of BB’s. Which target do you aim and shoot at?

Is it possible to shoot down a bullet traveling at 25,000 mph hiding in a cloud of BBs with another bullet ? The answer is no. No one knows how to do that nor will anyone in the next 20 years, if ever, figure out how to do it. Then what is President Bush up to? The answer is obvious: Corporate Welfare.

Corporate Welfare is just one example of the reactionaries in the Federal Government and on Wall Street waging class warfare against the American middle and working classes. Billions of hard earned tax dollars will be spent on the Star Wars program which has no hope of being built . On the other hand, the big corporations who will get the Federal contracts to build Star Wars will become wealthier and more powerful endangering our democracy.

May 2001