How the State Buys Support for Its Expropriation

Advocates of higher taxes love to point to wealthy individuals and large corporations that also advocate higher taxes as proof that higher taxes are a good thing. What those advocates don’t bring up or remain entirely ignorant about is the motivation wealthy individuals and large corporations have for raising taxes. Take the case of AT&T, a company that recent came up in support of raising taxes. Why would AT&T want to raise taxes? The answer is simplicity itself:

[A bunch of nonsense implying that the Republican Party lowers taxes while the Democratic Party raises taxes.]


A skeptic might point out, however, that AT&T does a lot of business with the U.S. government. AT&T Government Solutions boasts that it employs “more than 4,000 scientists, engineers and analysts—many with security clearances” who “focus exclusively on the IT requirements of government.” One federal contract AT&T won last year had a potential value of $5 billion, which is real money even to a company as large as AT&T. The company, like other wireless phone providers, also earns revenue from the “Lifeline” program that provides subsidized cellphones—so-called Obama phones—to low-income customers. And AT&T has already seen what negative effects hostile government agencies can have on its business—when a Justice Department antitrust lawsuit and FCC opposition blocked AT&T’s takeover of T-Mobile, AT&T wound up paying T-Mobile a $4.2 billion “break-up fee.”


The sad reality, though, is that the thousands of dollars that my business would mean to AT&T, or the millions of dollars that the business of other like-minded Americans would mean, are dwarfed by the value of a $5 billion government contract or winning the favor of a regulator with the power to approve or deny a multi-billion-dollar deal.

When a business is in bed with the state they will often tend to support higher taxes because that means more potential revenue for the business as well. You always want to ensure your cash cow is flush with cash.