YOU CAN SEE THIS LOGIC AT WORK IN
MANHATTAN, WHERE THE FATTEST FARM SUBSIDY CHECKS ARE MAILED TO THE RICHEST ZIP
CODES.
You can see this logic at work in Manhattan, where the fattest farm subsidy checks are mailed to the richest zip codes. Like the $825,346.56 addressed to Kent M. Klineman at ZIP code 10020, one of Manhattan’s wealthiest, with an average income of more than $500,000: 10 times higher than the rest of America. In fact, Klineman, who got the cash from 1995 to 2006 for growing wheat and sunflowers and raising livestock on a South Dakota cattle-breeding ranch called Eagle Pass Ranch, just might be the most subsidized farmer in Manhattan. But you probably wouldn’t have caught this 77-year-old Harvard Law School grad (this alma mater appears quite often among Manhattan’s subsidy queens) at the ranch, shoveling and trucking manure and inseminating the sows. Judging by SEC records, Klineman is more of a wheeling and dealing finance type, running venture capital companies, private investment funds and assorted dubious finance companies. Also keep in mind that in 1974, Klineman was among 13 people indicted on various fraud charges in a 100-million Madoff-style ponzi scheme that involved selling millionaires and movie stars fraudulent shares in an oil-drilling outfit called Home-Stake Production Co., by promising astronomical returns, which were paid out not from profits but from money put in by the newest round of sucker investors. Liza Minnelli, Barbra Streisand, Bob Dylan, Barbara Walters and Mike Nichols, among others, were purportedly bilked for hundreds of thousands of dollars. But it wasn’t just naive Hollywood entertainers that were scammed. The heads of some of America’s biggest corporations, including the president of American Express, the chairman of General Electric, and the chairman of Pepsi, were all caught up in the scam. In the end, the scam’s ringleader—Robert S. Trippett— got away with a scolding and a small fine, while charges against
Klineman were eventually dropped.
Farmers have come to expect preferential treatment
from the government. While the rest of us are constantly slapped with
new laws, regulations, taxes and fees, farmers have been left to do
their own thing because they are too fragile to be squeezed for cash
like the off-farm masses. Aside from being exempt from things like
zoning laws (a farmer’s property is taxed at a fraction of its market
value), they get tax breaks, tax credits, tax abatements and all sorts
of other perks that shrink their overall tax exposure to just about
nothing, regardless of their wealth. So not only do they milk taxpayers
for billions in subsidies, they do not even contribute their fair share.
Subsidies and tax
breaks? That’s free money times two. Naturally, the rich have been
exploiting America’s kindly treatment of its farmers from day one,
widening loopholes, relaxing restrictions and turning farms into
personal tax havens and petty cash machines that allowed them to give
less, while taking more.
Even a Capitalist Hall of Fame family like the
Rockefellers, known for their generous charities and contributions to
culture, turn out to receive government welfare.
Mark F. Rockefeller, a
fourth-generation industrialist, probably had taxes on his mind when he
purchased roughly 5,000 acres of farmland in Swan Valley, Idaho, and
started receiving subsidy checks at his capitalist lair in the
Rockefeller Plaza. Starting in 2001, the federal government has been
giving him $54,500 a year to not farm his land. That’s right: The
government gives your money to a member of the ultimate capitalist clan,
which has a combined worth of more than $200 billion, to just laze
around, not work and let his fields weed over. It’s what they call a
“conservation payment” program, in which the government pays farmers to
convert their land into something natural, like wetlands or whatever
other eco-friendly habitat might be appropriate for the environment.
It worked out well for
Rockefeller. By some strange coincidence, his farmland happened to be
right next to an upscale fly-fishing resort he opened up with his wife
in 1999. The place, called South Fork Lodge, plays host to groups of
rich, middle-aged men who pay $1,000 a day to fish in elegance and beauty
with a personal fly-fishing guide. According to its website, “South
Fork Lodge rests on a dramatic bend of eastern Idaho’s world famous
South Fork of the Snake River in scenic Swan Valley. As you prepare to
spend your day on one of the most scenic and majestic fly-fishing rivers
in America, you will marvel at the breathtaking views from your room or
the Lodge patio.”
What
their guests probably don’t know is that they’ll be paying for some of
those views twice: once to South Fork Lodge and once to Mark F.
Rockefeller himself.
Rockefeller gets double
the welfare by gaming the generous tax breaks built into agricultural
land. It appears that instead of having South Fork Lodge own the land
surrounding the resort and suffer the full force of a normal property
tax rate, Rockefeller has had the business buy up just enough property
to house the hotel’s various structures, while he purchased all the open
space the resort needed—riverfront real estate for fly-fishing, outdoor
activities and background scenery—in his own name and dedicated it to
farming.
It’s
win-win for Rockefeller’s business, allowing South Fork Lodge to offer
commercial services on land for which he pays almost no taxes. The lodge
charges $1,700 per night for its outdoor safaritype quarters, complete
with servants and a personal chef, which they offer to guests who want
to rough it in a “gorgeous wilderness retreat nestled in the cottonwoods
and aspens of the South Fork of the Snake River Canyon Section.”
Two of Rockefeller’s
spinoff businesses— which provide guided fly-fishing trips—also exploit
the tax-free property, using it for private boat-launches, riverfront
access and camping. If you were wondering why wealthy guys like him
would go all the way out to places like Idaho for a lousy couple of
grand in subsidies, do the math: He’s making a fortune off the land.
Rockefeller pays a pitiful property tax of roughly $10 per acre,
something like 1/60th of what it should be. Adding up the 5,000 acres or
so, he gets a massive tax break of $500,000 or more.
But rich subsidy queens
don’t need to travel far to filch their fair share of taxpayer wealth;
they can do it right where they live and work. Failed dot-com
entrepreneur Craig Winn lives in Albemarle, Va., and paid $1,000 in
taxes on a $3.5 million estate by converting its 50 acres into conserved
farmland. All his rich neighbors, including pop culture hacks Dave
Matthews and John Grisham, enrolled their land in the tax saver program,
too. Hell, even Walt Disney World became a farmer by putting some cows
to pasture on its land in Orlando to shave millions off its tax bill.
Hewlett-Packard opened up a Christmas tree farm on its massive Houston
campus, which saved it (and cost Houston) half a million dollars a year
in taxes.
No wonder
America is starting to feel like a third-world country. Fighting two
wars and bailing out banks is enough without having the rich plundering
our country right out from under us. It’s not just property taxes,
either. In the past decade, two-thirds of corporations doing business on
U.S. soil paid no income taxes. The rich aren’t just not paying their
fair share, they’re not paying anything at all.
http://nypress.com/the-making-of-manhattans-elite-welfare-farmers/