Other supporters of business-government partnerships argue that not only major corporations but also many small entrepreneurial firms rely on federal R&D grants for products that generate widespread public benefits that might otherwise go unfunded. Joel Johnson, vice president of the Aerospace Industries Association, a Washington-based trade group representing a profitable sector of the economy that receives billions of dollars in federal subsidies and tax breaks, defends the present government policies. "There are business and political leaders," says Johnson, "who recognize that the only way the government--whether it is the Defense Department or the Energy Department--can afford the new technology is if it works with business. But that is a partnership, not welfare" (Sennott 1996).
In response to this vigorous defense of existing public policy, the Cato Institute offers an extensive list of counterarguments to corporate welfare (albeit from a libertarian perspective, which asserts a government should do little more than provide police and military protection; other than that, it should not interfere--either for good or ill--in citizens' lives):
* The government has a disappointing record of picking industrial winners and losers.
* Corporate welfare is a huge drain on the federal treasury for very little economic benefit.
* It creates a tilted playing field among industries and firms.
* It fosters an incestuous relationship between business and government, most obviously through corporate campaign contributions.
* It raises costs to consumers.
* The most efficient way to promote business in America is to reduce the overall cost and regulatory burden of government.
* It is anticapitalist, creating the "statist businessman in America."
* It is unconstitutional, lying outside Congress's limited spending authority.
* The government has a disappointing record of picking industrial winners and losers.
* Corporate welfare is a huge drain on the federal treasury for very little economic benefit.
* It creates a tilted playing field among industries and firms.
* It fosters an incestuous relationship between business and government, most obviously through corporate campaign contributions.
* It raises costs to consumers.
* The most efficient way to promote business in America is to reduce the overall cost and regulatory burden of government.
* It is anticapitalist, creating the "statist businessman in America."
* It is unconstitutional, lying outside Congress's limited spending authority.
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