How Government Subsidies Drive the Wealth Gap

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• The government, wielding its power to tax and spend for the “general welfare,” offers huge financial incentives(grants, tax credits, loans) to private corporations in exchange for job creation.
• To motivate corporations — whose primary mandate is maximizing shareholder value — incentives must meaningfully increase stock value per share.
• As a result, a vast majority of the subsidy flows to shareholders and executives, not workers.
• Consequently, these subsidies effectively transfer wealth upward, magnifying the wealth gap.
• Meanwhile, public funds are diverted from essential services (your “five pillars”: infrastructure, housing, jobs, food, and fuel), increasing burdens on everyday taxpayers.

Big Tech Data Centers (Ohio and elsewhere)

• Cities provided massive tax breaks and subsidized power rates to Amazon, Google, Microsoft, and Meta.
• Jobs delivered: Often fewer than 150 per facility.
• Estimated public cost per job: Over $2 million.
• Result: Utilities and local taxpayers bear increased infrastructure costs, while the companies benefit from long-term cost reductions and land grants.

CHIPS Act Subsidies

     GM and Stellantis

• Received $1.1 billion in federal grants to retool factories for electric vehicle (EV) production.
• Jobs promised, but quantity and quality unclear.
• Micron
• Received $6.165 billion to build chip fabs in Idaho and New York.
• Claimed up to 20,000 jobs, putting cost per job at roughly $300,000.
• Intel
• Secured $7.86 billion in direct subsidies, plus eligibility for an $11 billion loan.
• Funds went toward expanding chip manufacturing in multiple states.
• Layoffs and cost-cutting actions followed the funding, raising questions about long-term employment impact.

     Inflation Reduction Act (IRA) Energy Incentives

• Created a $27 billion Greenhouse Gas Reduction Fund.
• Funds leveraged an estimated $250 billion in private investment.
• Result: Large financial gains for clean tech developers and financiers; unclear direct benefit to everyday workers.

     Tesla, SpaceX, and SolarCity (Elon Musk’s Companies)

• Have received a combined $38 billion in federal/state aid over two decades.
• Includes DOE loans, tax credits, NASA and DOD contracts.
• Share prices and executive compensation rose significantly following these awards.

     Tesla Battery Production Tax Credits

• As of 2024, Tesla received approximately $250 million per quarter in battery manufacturing credits.
• Resulted in significant profitability boosts and shareholder gains.

     Foxconn in Wisconsin

• Promised between $3 billion and $4.8 billion in subsidies for a supposed $10 billion facility.
• Initial job promise: up to 13,000.
• Actual jobs created: Around 1,500.
• Cost per actual job: Possibly millions, making it one of the most expensive job creation deals in history.

     Overall Corporate Subsidies (2024)

• Estimated at $181 billion/year according to the Cato Institute.
• Sectors include agriculture, energy, tech, broadband, and manufacturing.
• Most benefit large corporations with existing wealth and market dominance.

Example calculation (Intel/Micron-type deal):

• $3 billion subsidy
• 3,000 projected jobs
• $1,000,000 per job initial cost
• Workers receive only $50,000
• $950,000/job goes to shareholders/executives

This logic applies across most large subsidy deals.

• Share ownership is concentrated: 10% of households own ~89% of U.S. stocks
• Subsidies inflate share prices, boosting wealth for the wealthy
• Executive compensation, tied to stock, also soars
• Combined, these incentives create an upward redistribution of public funds 

• Infrastructure: Bridges, roads, broadband
• Housing: Affordable homes, rent assistance
• Jobs: Via public works, training, wage subsidies
• Food: Nutrition programs, school meals
• Fuel: Energy assistance, transition to renewables

Instead, the money empowers private capital, leaving the public to pay more later.

These subsidy dynamics amount to an effectively regressive wealth transfer, boosting the balance sheets of corporations and shareholders while increasing the burden on everyday citizens. In sum:

“Modern industrial policy has become reverse redistribution — subsidizing wealth accumulation at the top under the banner of job creation.”

The Government is a Reverse Robbin Hood, Robbing from the Poor and Giving to the Rich.