Cut Government

Waste
Vote for the Paul
Amendment
July 29, 1997
D ear Colleague,
Corporate we lfare is government was te--both bad politics and bad
economics.
The Export Promotion schemes in the Foreign Appropriations bill take money from the
taxpayers--from t he productive s ectors of the economy--to give to companies t hat contributed
to political candidates, lay off American workers (often shipping U.S. jobs abroad), and feed
at the government trough. This misdirection of investment capital causes inefficiencies that
raise unemployment rates and lower economic growth rates.
According to the Center for Responsive Politics, OP IC’s clients donat ed a t otal of $27.4
million in PAC and soft money contributions to federal candidates and parties in the 1996
election cycle--a great return on their investment, even as pandering politicians claim there is
no connection.
Handout requests: OPIC w ant s $80 million in new taxpayer money,
Export-Import Bank wants $632 million in new t axpayer money,
Trade Development Agencyw ant s $43 million more.
This money goes to politically well-connected companies with poor records of creating jobs.
M any of its recipients have in fact downsized their workforce and shipped U.S.jobs abroad:
Boeing Inc., t he top recipient of corporat e welfare from the Ex-Im Bank, slashed its U.S.
workforce from 155,900 to only 103,600 employees in the past s ix years. N ow Boeing w ants
the U.S. t axpayer to reward them for laying off 1/3 of t heir American workforce!
General Electric,t he second largest recipient of Ex-Im welfare, slashed its American
workforce from 667,000 in 1975 to only 398,000 twenty years later--cutting 269,000 w age
earners from employment in the U.S. yet GE maintains its reputation for shipping jobs abroad.

“Corporate welfare does not work anywhere in the world. It does not work because it
penalizes a country’s winners with excess taxes in order to fund that country’s losers with
inefficiently run government programs,” testified Dr. T.J. Rodgers , Pres ident and C.E.O. of
Cypress Semiconductor Corporation, before Congress in 1995. “ ‘T hey’ve got subs idies; we
need subsidies,’ is exactly wrong. America will be much more competitive on a relative basis
if we allow the nations with whom we compete to squander their taxpayers’ money, while we
encourage our companies to win without subsidies. It’s like the Olympics: there comes the
day when an athlete must walk alone into the arena of competition. T he government cannot
lift the weights and run the miles that are required to be a champion--only an individual can.”
According to the Congressional Research Service, “ In es sence, by s ubsidizing exports
directly, or indirectly by subs idiz ing overs eas direct invest ment , domes tic producers trans fer
income to foreign consumers who pay less for the goods they buy because of the subsidy”.
When other nations subsidize our imports and other nations’ imports, it frees up money to
purchase more net U.S. goods (CRS memo July 28, 1997, P rice and Income Effect s of Export
Subsidies).

Our trading partners are taxing their citizens to boost the U.S.
economy!
Let’s not tax our citiz ens to boost their economies ! Vote for the P aul amendment!

Sincerely,

Ron Paul, M.C.