Democrats have long embraced ‘oligarchs’ with corporate welfare schemes

Democrats have seized on the word “oligarchs” to describe some apparent influence mysterious people have over Republicans. The word, which most people probably can’t define, has a harshly negative connotation that makes it all the more sinister.

But in reality, it is Democratic leaders in Washington, D.C., and state capitals across the country that have created a form of government in which the monied elites, also known as oligarchs, carry great favor and influence.

A better description is “corporatists,” that is, businesses that exploit government policy and use willing politicians for their own advantage.

The exchange isn’t complicated: Campaign contributions lead to election wins, and election wins lead to self-serving policy. Some variation of this has undoubtedly existed since the invention of democracy thousands of years ago. 

There are several ways they can do this. In Michigan, we have seen an utter abuse of “business incentives,” which are little more than corporate welfare.

Gov. Gretchen Whitmer’s (D-MI) economic strategy has amounted to attempting to lure big businesses, especially foreign corporations, to the state with tax breaks and cash payments.

Don’t let Democrats fool you when they complain about the “rich not paying their fair share.” They are the ones using the tax code to get that company and score the next positive press release.

Whitmer is traveling the world, hoping to lure companies to Michigan. It’s noteworthy she’s not driving across the border to Ohio or Indiana. Why? Whitmer’s Michigan is one of the most unattractive states in which to do business. Not to mention, Toledo is not quite as beautiful as London in springtime.

Earlier this month, Michigan suffered a 128.34% jump in unemployment claims, according to the personal finance analysis website WalletHub, which ranked it the worst in the country.

Michigan ranked 51st among all states, including Washington, D.C., for both the increase in claims in the first week of May versus the week prior and claims per 100,000 people in the labor force.

Michigan’s 128.34% spike in claims last week was far higher than all other states, with the next closest increase in New Hampshire at 81.05%. Others among the top 10 biggest increases include Maryland at 30.38%, Alaska at 21.73%, Minnesota at 11.68%, the District of Columbia at 10.31%, Oregon at 10.26%, Virginia at 9.46%, Ohio at 9.23%, and Washington at 9.05%.

To address this problem, Whitmer has decided she needs to snag some new corporations by letting them live in the state essentially tax-free, effectively shifting their tax burden onto other businesses and individuals alike.

To make matters worse, Whitmer now wants a corporate tax increase for every other job creator in the state. Instead of cutting wasteful spending to increase road funding, Whitmer wants to raise taxes.

“It’s not going to be all in cuts, and it’s not going to be all in new revenue, but all of these pieces are important to the final outcome that is going to be fixing the actual problem that we’re trying to solve,” she said recently.

Whitmer’s allies have gone so far as to propose a 30% corporate tax hike, raising the state corporate tax from 6% to 8.5%.

“This increase penalizes the entire economy and creates a new challenge for doing business in Michigan,” a representative of the Detroit Regional Chamber told MLive.

According to the Tax Foundation, 16 states have reduced corporate income taxes over the last seven years. An 8% rate would make Michigan the 14th-most expensive state to do business.

In 2022, Whitmer wanted a talking point about jobs, so she threw $715 million in cash and tax relief at a Chinese battery maker with documented ties to the Chinese Communist Party called Gotion High-tech. Aside from it being a horrible national security decision, three years later, not a single job has been created.

That’s not unique, unfortunately for Michigan taxpayers. 

Democrats created the Strategic Outreach Attraction Reserve, or SOAR, as a vehicle to distribute corporate welfare to chosen companies. After doling out over $670 million in cash to five companies, “zero” jobs have been created, despite 8,812 new jobs being promised.

“The program was poorly designed from the start,” James Hohman, director of fiscal policy at the Mackinac Center for Public Policy, said. “It allows companies to cash in on taxpayer subsidies without having to create jobs. Lawmakers must wait years to ask for taxpayer money back if deals fail to deliver.

The politicians are indifferent. They got their press release and glowing story, not to mention the campaign contributions and other perks. Heck, maybe even a potential job after leaving office. In the meantime, taxpayers are left holding the bag, forced to foot the bill while having hopes dashed when new opportunities don’t materialize.

Democrats and even some Republicans have created governments built on crony capitalism. But there are voices out there that are a threat to that cushy way of life, people who believe that government shouldn’t be for the monied few. It shouldn’t be billionaires – oligarchs – electing politicians who then give them corporate welfare.

One of the aspects of President Donald Trump that so many people find appealing is that he doesn’t answer to crony corporate donors.

“He can’t be bought, unlike most of the politicians in this country. And he is standing here for the American people,” Health and Human Services Secretary Robert F. Kennedy, Jr. recently said.

“Elizabeth Warren or Robert Reich are saying that President Trump is on this side of the oligarchs. There has never been a president more willing to stand up to the oligarchs than President Donald Trump.” 

But even as Trump has stood apart from this web of cronyism, these systems of corruption arranged by politicians and their corporatist donors are not victimless. Communities have and will continue to suffer.

The irony is that the Democrats who moan about school and road funding will privately shovel those funds into the bank accounts of the corporatists. They have a quid pro quo in place. They provide millions of taxpayer dollars for the rest of the corporatist’s life in exchange for campaign funds. 

The billionaire class buys their own politicians in blue states. The rich get richer while the poor lose their jobs, attend declining schools, suffer rising costs, and watch their communities become unsafe. Sadly, in some states, it is hard to tell the difference between corporatist Democrats and Republicans. 

Sen. Bernie Sanders (I-VT) and Rep. Alexandria Ocasio-Cortez (D-NY) can complain about their own side and some of the folks from the old Republican Party, but the Trump era is different. The president has led by example when he bucked the establishment and won in 2016 against the very political money machine they rail against.

Sanders’ party pushed him out of the 2016 primary and financed Hillary Clinton. As Clinton and later Kamala Harris discovered, money isn’t always the answer. Unlike Russian oligarchs, regardless of how much money American corporatists pour into politics, the people still have the final say. 

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The people must choose wisely. The divide between rich and poor is too often determined by those dropping large sums of money to boost their political fortunes.

American politics has become a billion-dollar industry, and too often, politicians are just pieces on the billionaire’s chessboard. Watch out for the candidates who get the attention of corporatists but can’t win over the people’s hearts. Your elected officials should be more than just players in a game. They are meant to serve the people. 

Tudor Dixon is a former Republican gubernatorial nominee, executive in Michigan’s steel industry, breast-cancer survivor, and working mom of four girls. She is currently the host of The Tudor Dixon Podcast.