A tax break is not a subsidy. As I’ve written, a tax break lets someone keep more of his own wealth, while a subsidy takes money from one person and gives it to someone else. Thus, when the “fiscal cliff” compromise gave tax breaks to Nascar, Starkist, “algae-based fuel,” and more, that legislation was not granting subsidies. Likewise, when the government allows oil companies to count business expenses against their tax liabilities, or gives certain oil companies a tax break, that does not subsidize the oil companies.

If you wish to see an example of actual subsidies, look no further than the Hurricane Sandy “relief” legislation. As Jon Fleischman writes, “You would not believe how many billions of dollars in pork barrel spending has been stuffed into this legislation by appropriators in the upper chamber.”

Actually, given my observations of how the federal government functions these days, I would not only believe it, I would predict no better.

As Fleischman reports, the “relief” legislation as it came out of the Senate provided billions of dollars for such things as cars for Homeland Security, fishery funds for the National Oceanic and Atmospheric Administration, roofing repairs for the Smithsonian, forest restoration funds for private landholders, future public transportation projects, “community development” projects, and repairs for the Kennedy Space Center.

Those are subsidies, albeit mostly for government agencies rather than private parties.

So how should advocates of individual rights respond to tax breaks and subsidies? We should demand an end to all government subsidies for private parties, the elimination of government spending on all programs save those that recognize and protect individual rights, and the continual expansion of tax cuts for everyone.

Like this post? Join our mailing list to receive our weekly digest. And for in-depth commentary from an Objectivist perspective, subscribe to our quarterly journal, The Objective Standard.


Creative Commons Image: Watt Ag Net

Return to Top

Pin It on Pinterest