Jason Hartman hosts Phil Harvey, author of Welfare for the Rich: How Your Tax Dollars End up in Millionaires’ Pockets and What You Can Do About It. He discusses his book, sharing many bizarre examples of how even billionaires and millionaires are receiving payouts of various programs. Later, Jason and Phil get into a discussion on real estate in coastal cities and how the zoning has made housing unaffordable.
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Welcome to the holistic survival show with Jason Hartman. The economic storm brewing around the world is set to spill into all aspects of our lives. Are you prepared? Where are you going to turn for the critical life skills necessary to survive and prosper? The holistic survival show is your family’s insurance for a better life. Jason will teach you to think independently to understand threats and how to create the ultimate action plan. sudden change or worst case scenario. You’ll be ready. Welcome to ballistic survival, your key resource for protecting the people, places and profits you care about in uncertain times. Ladies and gentlemen, your host Jason Hartman
Jason Hartman 1:00
It’s my pleasure to welcome Phil Harvey to the show. He is the author of five books, including welfare for the rich. That’s his newest work, how your tax dollars end up in millionaires pockets and what you can do about it. And also his last book, which is the human cost of welfare, how the system hurts people it is supposed to help. So welcome. How are you?
Phil Harvey 1:24
I’m well and it’s good to be here.
Jason Hartman 1:26
Good. It’s good to have you on and you’re coming to us from outside Washington DC area. Right? That’s right. Excellent, excellent. Well, what is going on with the system and how are taxpayers getting burned by having welfare go to many of the wrong places?
Phil Harvey 1:43
It’s It’s shocking, really the I think there can be a general agreement among people leaning left and leaning right on the political spectrum that the least fortunate among us in society deserve some help from the government. And indeed, there’s a very large program, particularly in the days of the pandemic, to assist those whose incomes are very sparse. But what shocks me and my co author Lisa Conyers, is the fact that so much of taxpayer money is going to parties who are extremely wealthy, in some cases, billionaires, and many, many millionaires and the corporations that they take part in for No, no reason except for the fact that various parties have lobbied effectively to get programs going and once a program gets going in Washington, DC, it’s practically impossible to end it.
Jason Hartman 2:48
So the it’s a note and Friedman said that so well, he said, I’ve never seen anything so permanent as a temporary government program.
Phil Harvey 2:55
Thanks. Exactly right. And he couldn’t be more right. The best The best story there which included in our book, by the way, was the sheep and goat program that was introduced because wool and mohair were badly needed during the Second World War for for making uniforms. Maybe middle the First World War anyway, way back and the government subsidized sheep and mohair, farmers and growers. Year after year after year, somebody would stand up in Congress and say the war is over. We don’t need this for uniforms anymore. Let’s end this program and never got an end. And then finally sometime in the 90s, it was eliminated for one year, the
Jason Hartman 3:44
year
Phil Harvey 3:45
we were Congress voted to simply and the program that was wasteful and unnecessary and the next year, sure enough, it came back in a different format and the mohair Well, folks are back almost on the subsidy trained for absolutely no rational reason, except for those people who benefit immediate
Jason Hartman 4:10
from it. These are the iron triangles that exist in so many parts of government probably just everywhere. And every level of government, state, federal local, it’s just someone who’s getting paid. And that’s why it just can never be efficient or properly allocated. It’s absolutely ridiculous. So talk to us more about these multimillionaires and billionaires and giant companies that are that are getting welfare. I mean, the common thought, I guess, Phil would be that, you know, look, you know, these people don’t get disability, they don’t get unemployment insurance. How are they getting welfare?
Phil Harvey 4:49
Well, the most egregious example I think, is in the farm program, a farm bill as it’s called, it’s been renewed every year for years now and I think It started in the depression, when assistance to farmers actually was needed and it made sense back then. But like so many other programs, the Farm Bill program, not counting the part that goes to food stamps, which is a separate subject in many ways gives away about $96 billion a year to farmers and farm interests, with very little attention paid to the wealth of those benefiting with a result that some of the largest farms and some of the largest agricultural corporations, I get most of the benefit. One telling example is a woman named Penny Pritzker who is a billionaire I mean, she inherited scans of money from a mill and Lumber Company in Chicago some some years ago. And doesn’t farm she isn’t a farmer but she owns some property that is farm or some, at least some property that can be farmed and qualifies as agricultural land? Well, she got $1.6 million over a recent decade, just because she owned that property. Now this is not somebody who goes out and runs up reboring machine or planting machine or gets your fingers, fingernails dirty. He just happens to own some property. She owns the property because she’s already well,
Jason Hartman 6:28
so what kind of subsidy does she get?
Phil Harvey 6:31
He gets a cash check just based on the fact that she owns property that is farmed or as farmable Hmm, there are dozens of these. Let me get a quick statistic here. 50 billionaire members of the Forbes 400 which pretty good about listing billionaires got $6.3 million in subsidies over A similar recent decade, for no good reason. I mean, the idea that very, very wealthy people who haven’t own farm property should be getting taxpayer money is nuts.
Jason Hartman 7:13
Well, you know, just Just let me play devil’s advocate for a moment on that. So I’m a real estate investor, and I teach people how to invest in real estate. We’ve been doing that for many years, almost 20 years now. And we’ve looked at farm deals. As you know, our investors have asked about, you know, what do you think about investing in farmland? And, you know, Phil, the returns aren’t very good. It seems like a good idea. Everybody needs food, sort of on the face of it. farmland seems like something that is just a staple, right? But the actual returns on on investment are just pretty miniscule. So is that designed to help incentivize farming of land and the ownership of that land? I mean, it’s got to be owned by somebody and financed by somebody, right? I don’t You know, maybe if they took that away, would there be less investment there? You know, the government everybody responds to government incentives. I’m not saying it’s, it’s right. It’s just true.
Phil Harvey 8:10
Well, certainly the fact that farmland may not be a found or a wise investment for an outsider, is no argument against the fact that that people who own farm property, quite probably for other reasons, are getting these free these free bonuses for no particular reason without deserving it in any way, shape or form.
Jason Hartman 8:35
Well, does he does the land have to be actively farmed to get the incentive, or cage just be dormant land that’s not being farmed that would remain?
Phil Harvey 8:44
Yeah, well, that that happens. There is a program under the farm bill that pays farmers to let certain acreage lifestyle for a period of time. This was well intentioned, but it does resolve on the fact that we’re paying some farmers not to grow anything. thing at all for extended periods, which is on its face, always say a little embarrassing. Yeah. But overall, this is simply picking the pockets of the American taxpayer to benefit very wealthy people, it makes no sense.
Jason Hartman 9:17
Do you address some of these tax schemes that companies like Apple and Amazon and Google are using to, you know, basically evade taxes? I mean, they’re not technically evading taxes, because they’re just taking advantage of the laws that are out there. But seems ridiculous to me, that these incredibly wealthy companies and incredibly wealthy executives or founders can get away with what they’re doing, you know, by setting up these entities in different states and in different countries. It’s just ridiculous.
Phil Harvey 9:50
Well, I won’t argue that i think i think you’re quite right. We do not go into the complexities of the tax code for those kinds of countries. is in the book but we do cover tax advantages of the sort that clearly involve taking taxpayer money and subsidizing non taxpayers. I favorite example of this is the Walt Disney Company, which owns some, some acreage in Florida. Resume somewhere near there, their entertainment sites, disneyland Disney World and and so on where they rent cows. They actually don’t. There’s like a rule in Texas where you can get a huge break on your property taxes. If you just put at least one cow on that land. Well, there you are, and that is farmland. We’re asking people to do something that’s not productive and stupid. It’s simply unjustified. That kind of thing happens. Great. We’ll
Jason Hartman 10:52
give us some more examples if you would. We talked about the Farm Bill. We talked about the wall, what else is happening and then let’s make sure we can cover what we can do about it before we wrap it up?
Phil Harvey 11:02
Okay, well, an area that is much less well known because the impact is harder to to evaluate at a glance is the zoning rules. This is particularly burdensome right now, in a country with a severe job shortage is facing great difficulties in getting people back to work and in the homes they can live in. zoning, particularly on both coasts, also, especially coastal cities in California have zoned their cities in such a way that housing is simply become unaffordable to the average person. You cannot move to San Francisco for example, and try to rent or or buy but usually rent a place to live unless you’re pretty rich, let’s start. Sure and the result the result is that we’re reducing the number of jobs are far People who go to cities like that, because there is work available and ending up 100 miles out in a suburb somewhere where they can afford housing and this is badly inhibiting the employability of many.
Jason Hartman 12:18
I agree with you. But the environmentalists would say, you know, we can’t have any more people, you know, it’s just, it’s too crowded. We see this all over these dedicated open spaces under the guise of it being for the environment. But what that really does is keep people out of the housing market. I call that environmental racism. And I had Thomas Sol on my show years ago. I coined that term actually, during that interview with Thomas Sol. And what what do you say to them, though, you know, it’s, you know, all this development is bad for the environment, right?
Phil Harvey 12:50
Well, it’s certainly fine to have open spaces, but you can’t have big open spaces in the places where the jobs are people will go to find out work that’s a universal, universal phenomenon. And if you make housing affordable at or near the places where the jobs are, you’re simply shooting yourself in the foot.
Jason Hartman 13:13
Well, so what what would San Francisco do? For example, would they build more high rises to help more people? What can be done?
Phil Harvey 13:21
Absolutely. They would build more high rises, they would build them multi family homes of various kinds. A lot of zoning is for single family homes online, which of course gobbles up enormous amounts of land per occupant,
Jason Hartman 13:34
right. But San Francisco is completely built out. I mean, there’s no vacant land in San Francisco. So what do you do?
Phil Harvey 13:42
One simple way of adding to the housing availability in San Francisco would be to allow all existing buildings to add one more story. This would make a significant difference. But there are rules in San Francisco against doing that.
Jason Hartman 13:57
Well, that’s because they want to keep they don’t want The density to be any higher, you know, they don’t want it to affect people’s views and all kinds of you know, you’ve got all these conflicting interests, right?
Phil Harvey 14:09
Sure. Certainly you do and and a lot of it comes from the NIMBY folks. They’re not in my backyard right phenomenon where that backyard
Jason Hartman 14:18
is becoming bigger and bigger, by the way for us.
Phil Harvey 14:21
Yeah. Yeah. And then the value of those those homes that exists there Now, of course, a shot up so that the people, the people who own those single family homes have done extremely well.
Jason Hartman 14:34
Yeah. But I mean, say you just keep building and building. I mean, everybody will just keep coming. You know, I’m a big fan of john Denver’s music and he has this lyric in one of his songs where he’s talking about Colorado and the lyric is more people, more scars upon the land. So how do you weigh these interests, their opposing interest? I mean, if if you consider people to be scars
Phil Harvey 14:57
upon the land, I don’t
Jason Hartman 15:00
I don’t I think people listen, I’m not an alpha Museum, but I’m just I’m parroting their arguments. I mean, you know, the left argues against development. They argue against providing housing to people and they argue for open spaces. You can’t have both. You have to choose their directly opposing interest, right?
Phil Harvey 15:20
They often are. I completely agree. And if you want people to be able to work and thrive and prosper, you have to allow housing to be built. I’m all for open spaces, but they don’t need to be in places where they compete with with housing for work.
Jason Hartman 15:38
Yeah. But you know, I’m from I don’t live there now, but I’m from Southern California. And so I lived in Newport Beach for many years. One of the things in Newport Beach and also in neighboring Irvine. I don’t know if you’re familiar with those cities. You know, Irvine is a very masterplan city and, you know, they’ve got all these dedicated open spaces and you There’s a vibrant economy there. I mean, you know, it’s a, it’s a high end area, all these open spaces just simply served to create a housing shortage, but it’s beautiful. I mean, you know, I remember all my friends, circulating fliers save Crystal Cove State Beach, don’t let them develop it. You know, they were so against it. And I thought, you know, basically, your whole argument is, you’ve already got yours. So don’t share with anybody else. Right, keep other people out and prop up your housing prices. It’s like that old old riddle, right. What do you call a developer? Someone who wants to build a house at the beach or in the woods? What do you call it environmentalist? Someone who already has a house at the beach or in the woods? Yeah. So what do you do about it? Right?
Phil Harvey 16:48
That’s exactly right. Well, I mean, there are compromises that have to be made. I would not suggest that. Cities feed entirely without parks. For example, we need to make living isn’t working and cities reasonably attractive? I’m all for that. But you don’t have to zone people out of affordable housing. I mean, the city of Houston, for example, has no zoning of any kind. And people, you know, say with great horror, imagine having no zoning. Well, Houston has no zoning. they brag about it.
Jason Hartman 17:20
But Houston Houston is rather nice. I mean, we you know, I own property. I know. Yeah, it’s quite nice. Yeah.
Phil Harvey 17:27
You don’t need zoning to have a nice livable city. In any event, I certainly agree with your term racial zoning and is has has
Jason Hartman 17:36
been the result of higher mental racism. Yeah, environmental. The word spread the word Yeah. Now really, people have to know about it, because it’s a it’s really unfair. It really is. You know, you’ve got a couple other maybe touch points. Just before we wrap it up, that I want to ask you about, you know, you talked about housing, we’ve got, you know, food steps, missteps with women and children. You know, we disabled The disabled. Do you want to touch on any of those as we wrap it up?
Phil Harvey 18:03
Well, I would I would mention just one more program related to agriculture but it’s a it’s a basically a different program. And that’s the sugar program because it’s one of the most egregious of government subsidy efforts. Everybody pays about twice as much for sugar and sugar containing products every time they go to the supermarket twice as much as they should have to pay because sugar in America costs double the world price. This is done for the benefit of really a very small number of very wealthy sugar barons who grow sugar cane primarily in Florida, man and pay fine who is another billionaire benefiting from government policies, and even people who are too poor to be paying any kind of federal income tax or below The tax level still have to buy groceries. So, virtually everyone in America is subsidizing vape a fundable and his billionaire ness, one of the most obscenely unfair programs that the government takes part in. Should we eliminate lobbyists? I mean, a lot. A lot of this is a result of lobbying, of course, we can’t eliminate lobbyists because the First Amendment to the Constitution specifies that one can represent one’s case in front of the government. It’s a very fundamental American, right. There are ways of making lobbying, a little less intense. But it’s a it’s an uphill battle and one that requires an alarm citizenry, I think, an extent that we may have difficulty achieving.
Jason Hartman 19:55
Yeah, I agree with you. give out your website and tell people where they can find out
Phil Harvey 20:00
Well, welfare for the rich has its own website called welfare for the rich.org. And you can find out a lot about the book there. It is available on Amazon, and a great many other places. And we hope you’ll have a look at it and learn just how much of your money is going to how many very, very wealthy parties.
Jason Hartman 20:23
Excellent. Phil Harvey, thank you so much for joining us.
Phil Harvey 20:26
My pleasure. I enjoyed it.
Jason Hartman 20:32
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