Saturday, August 20, 2011

Government subsidized corporate profit

There are some areas where big corporate profit is subsidized that we rarely give any attention.

For example, Walmart pays most of its employees below the poverty level.  As a corporation they make a huge profit but this profit is clearly subsidized by every penny of public assistance received by their employees.  Any company showing a profit should be required to raise their employees pay until no public money enters the loop.  It's not a big stretch to realize that there is little difference from using cheap labor overseas where the companies can pay less by not meeting environmental and social responsibilities to making a profit in the United States by paying a low wage and having the slack picked up by public funds (public funds we really can't afford I might add).

Another area of public subsidy is waste removal.  A corporation can manufacture products and packaging and export the environmental costs of those materials on the front end to the community (often foreign) where they originate or on the back end to the municipality or county where they come out of use.  Regardless of where the money comes from to process the waste, we know it doesn't come from the corporation.  The taxpayer ultimately subsidizes the corporation by absorbing the cost of the responsibility for irresponsible manufacturing and packaging practices.  If we were to tax or charge manufacturers according to the amount of waste they produce in a given time period I bet it wouldn't take long for them to change their practices.  The packaging, product durability, and manufacturing processes should all be part of a feedback loop that rewards companies who do well and punishes companies that don't.  There is even a term for this but we don't press it here in America.  "This is being done through an internationally recognized policy called "extended producer responsibility" (EPR)..... EPR establishes a legal chain of producer custody extending through the entire product life cycle."    Bill Sheehan and Helen Spiegelman, "Climate Change, Peak Oil, and The End of Waste"

It will require local initiative to bring the pressure for change in these areas.  The further you get from local the closer you get to levels of governance bought and sold by corporate sponsors.

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