If you believe America needs more corporate socialism, rejoice, for this is your time.
The Republicans on Tuesday night nominated for president one of America’s biggest beneficiaries of welfare for the rich, a man who says wages are too high. Donald Trump’s choice for vice president, Indiana Gov. Mike Pence, lavishes tax dollars on corporations while eliminating food stamps for adults who cannot find a job.
The Republicans say they are foursquare for capitalism, private enterprise, and individual responsibility. Then they go and choose as their standard bearers two men whose conduct establishes that they are true blue corporate socialists.
If you have not heard that Trump and Pence are true blue corporate socialists who believe in redistribution up, that’s not surprising. The news coverage of Campaign 2016 has been mostly about what Trump says, not what he has done.
But since so little is known about Pence, let’s look at his conduct.
Since Friday, when Donald Trump named Pence as his VP nominee, the news has been full of descriptions of Pence as a conservative Christian lawyer who lowered taxes in the Hoosier state. It’s true that he got the legislature to reduce tax rates, but there’s more to the story. His tax cuts heavily favored those with high incomes and assets, just as Trump’s plan would shower more tax relief on those on the highest rungs of the income and wealth ladders.
Blessed Are Those Who Don’t Receive
But it’s the doling out of welfare under Pence that I found most intriguing, especially for a man who solicits votes by touting his Christian faith.
Pence last year cut off food stamps to more than 18,000 unemployed adults. About one in every six people in Indiana depended on food banks, a 2014 study by that state’s association of food banks found.
Pence said in 2014 that cutting off food stamps would “make sure that able-bodied adults know that here in the state of Indiana we want to partner with them in their success.” That doesn’t make sense for this reason: There are five Hoosiers out of work for every job opening, the latest state and federal employment report showed. In May 2016, more than 168,000 people were unemployed, compared to fewer than 34,000 job openings that were identified by the state.
Cutting off food stamps makes sense when there are as many jobs as people want. But where’s the Christian charity in doing that when, even with improved conditions today, some four out of five people looking for work are not going to find it?
The disparity between work available and people who would work if they could find a job is actually much worse than the official statistics I just cited. That’s because the unemployment figure does not count people who have given up looking for work, knowing their search is futile.
So while I am sure Pence scored points with the so-called conservative movement in America by cutting off food welfare, I don’t see how to be squared with his claimed religiosity.
What the Bible Says About the Poor
While our Constitution specifies in Article VI that “no religious test shall ever be required as a qualification to any office or public trust under the United States,” and the First Amendment guarantees freedom to worship or not as one chooses, the law of the land does not prevent politicians from using their claimed religious faith to appeal to voters. Since relatively few Americans have religious training today, it is useful to put Pence’s actions as governor in the context of what the religious texts he subscribes to say about these issues.
God commanded, in one modern translation of Deuteronomy 15:11: “Since there will never cease to be some in need on the earth, I therefore command you, ‘Open your hand to the poor and needy neighbor in your land.’”
Proverbs 29:7 is also instructive. “The righteous know the rights of the poor; the wicked have no such understanding.”
Jesus, in the Sermon on the Mount, said, “Give to everyone who begs from you, and do not refuse anyone who wants to borrow from you (Matthew 5:42).”
And then at James 2:14-17: “What good is it, my brothers and sisters, if you say you have faith but do not have works? Can faith save you? If a brother or sister is naked and lacks daily food, and one of you says to them, ‘Go in peace; keep warm and eat your fill,’ and yet you do not supply their bodily needs, what is the good of that? So faith by itself, if it has no works, is dead.’”
Reporters who know their Bible should start asking Pence on the campaign trail how he squares his actions, such as cutting food stamps for the hungry when there is no work for many of them, with the appeals he makes to fellow believers.
Welfare for the Rich
When it comes to welfare for the rich, that’s an entirely different matter. Pence is big on corporate welfare.
Since Pence took office in January 2013, Indiana taxpayers have provided $818.5 million in subsidies to companies.That is only about a tenth of the largesse that state and local taxpayers have given to corporations since 1991.
You won’t find that total at the state transparency website on business incentives. But luckily people at Good Jobs First, a tiny nonprofit that keeps track of subsidies, scraped all the data from the state website and put it into Subsidy Tracker, a useful search engine.
The welfare collecting companies only had to invest $397.7 million, at least according to the data posted in the portal’s summary pages and then made available for examination by Subsidy Tracker at this link if you click on “individual subsidy records.
Indiana under Pence has been exceptionally generous with its better than $2-to-$1 match of taxpayer money to private investment. Just about anybody with the skill to run a business should get very rich if—for each buck of their money that they put up—they get two bucks, plus a nickel from the taxpayers.
In one case a company named MacAllister Machinery Company in Marion invested $1.34 million to qualify for a subsidy worth $1 million. That comes close to the terms under which the Republican convention main hotel was built—what I called a Commie Hotel in an earlier column, as it was built entirely with taxpayer money because no private investor was interested.
What Pence practices is not market capitalism, in my view, because it costs each Indiana household more than $100 per year to finance gifts to corporations, Pence also violates the biblical admonishment at Proverbs 22:16: “Oppressing the poor in order to enrich oneself, and giving to the rich, will lead only to loss.”
Indiana’s Vanishing Job Creation
In books and many articles, I have shown from the public record that these job subsidies, across America, have done lots of damage and in some cases even resulted in fewer jobs. The Indiana record of state-subsidized job creation is so weak that, under Pence, the state’s give-away arm has been hiding the size of the corporate welfare it gives and whether the money actually created any jobs.
Before Pence took office, when Republican Mitch Daniels was Indiana’s governor, reporter Bob Segall of WTHR Channel 13 in Indianapolis took a film crew to locations where the state had handed out money either in grants, loans or tax abatements to create jobs. He found one taxpayer-subsidized job center was nothing but an empty field. And that was just one of many nonexistent job locations for which his investigative reporting won 13 awards.
Now you might expect a grand jury would have investigated and maybe indictments would have followed. It didn’t happen.
Reacting to Segall’s reporting, the legislature passed a reform law. When he took office, Pence promised to be open about job-subsidy money. But, as reporter Segall has since shown, Pence’s transparency is mostly sham, as you can see by watching Segall’s report.
The state giveaway agency did not just hold back basic information, such as key wage and job-creation numbers. In many cases, it also started scrubbing the files, making completed and failed job-creation subsidy deals vanish from its website. That’s the kind of official rewriting of history associated with regimes more aligned with Marx, Stalin and Mao than Adams, Locke or Jefferson.
The facts show that whatever he likes to call himself, Mike Pence is a corporate socialist.
And while Pence is on the side that gives away taxpayer money, Trump has long been on the side of receiving it—in New York City, especially, with his Grand Hyatt Hotel deal worth at a minimum $400 million in welfare.
So rejoice, oh ye believers in corporate socialism, for the party of private enterprise has had its epiphany on the road to Washington and now sings hosannas to corporate welfare. Amen.
Pulitzer Prize winner and recipient of an IRE medal and the George Polk Award, David Cay Johnston is author of five books. His next book, The Making of Donald Trump, will be out on Aug. 2, 2016, to be followed by The Prosperity Tax: A New Federal Tax Code for the 21st Century Economy. He is a Distinguished Visiting Lecturer at Syracuse University College of Law and Whitman School of Management, and also writes for The Daily Beast and Tax Notes.