But at least congressmen back in 1913 occasionally tried to do something beneficial for the country. Today's Washington is more interested in exploiting those good intentions. Take the yacht deduction.

The luxury sailing industry was able to buy its way into the mortgage break when Congress officially declared boats as homes. But not just any boat. The rules require they have sleeping quarters, a kitchen and toilet, leaving just 3 percent of U.S. boat owners to qualify.

"The mortgage deduction was never targeted for that," says Congressman Tim Walz, a Democrat from Minnesota. "It was meant to make home ownership more affordable for the middle class."

Facebook founder Mark Zuckerberg took advantage of a multibillion-dollar tax scam during his company's IPO.
Guillaume Paumier
Facebook founder Mark Zuckerberg took advantage of a multibillion-dollar tax scam during his company's IPO.
Thanks to the luxury-sailing industry, taxpayers helped subsidize Octopus, the $200 million yacht belonging to Microsoft cofounder Paul Allen.
Wikimedia Commons
Thanks to the luxury-sailing industry, taxpayers helped subsidize Octopus, the $200 million yacht belonging to Microsoft cofounder Paul Allen.

So Walz wrote the Ending Taxpayer Subsidies for Yachts Act, hoping to bar the über-wealthy from sponging off the mortgage deduction. Once again Congressman Dave Camp refuses to let it come up for a vote.

That leaves everyday taxpayers to subsidize toys such as Microsoft cofounder Paul Allen's $200 million yacht, which comes equipped with an indoor pool, basketball court and its own submarine.

"It's a loophole in the tax code that benefits a few people at the very top," says Walz, a sergeant major in the National Guard and former teacher. "I certainly feel if they want to grab their luxury liners, I'm glad they do. And I'm glad we have people making them. I'm just not certain we subsidize that."


5. Big Oil's Cadillac welfare.
In August, Mitt Romney traveled to Iowa, where wind energy has become an economic force, responsible for 7,000 jobs and 20 percent of the state's electricity.

The Republican nominee dodged questions about what he'd specifically do as president with the $3.3 billion in tax incentives that now go toward spurring development in wind energy. Romney's campaign aide was less evasive.

"He will allow the wind credit to expire, end the stimulus boondoggles and create a level playing field on which all sources of energy can compete on their merits," Romney spokesman Shawn McCoy told the Des Moines Register.

But Romney has announced no similar crackdown on a much older and larger welfare queen: Big Oil.

The five largest U.S. oil companies collect a spectacular $20 billion a year in tax breaks. And they'd prefer that wind farms not compete for that lucrative welfare dollar. During this year's presidential race, the industry has paid Romney $3.4 million to ensure wind goes away.

Technically, the oil giveaway is supposed to defray the cost of searching for new sources. But even George W. Bush realized the industry didn't need subsidies back in 2005, when the price of a barrel was at $55. "We don't need incentives to oil and gas companies to explore," he said at the time. "There are plenty of incentives."

These days the price of a barrel routinely hovers around $100. But the five biggest companies — BP, Chevron, ConocoPhillips, ExxonMobil and Shell — still get their breaks, despite collective record profits of $137 billion last year.

"The oil industry is doing fine," says Johnson, the University of Texas tax expert. "They don't need or deserve a dime of subsidy. It's all money thrown away to make shareholders richer. The private market will provide any subsidies by increasing the price. It's time to get the government out of the business of special subsidies. It's like Cadillac welfare."


4. A break for shipping your job to China.
In April 750 workers at a Kimberly-Clark paper mill in Everett, Washington, lost their jobs when the company shipped their work to a lower-cost facilities overseas.

Steelworkers in Stevens Point, Wisconsin, suffered the same fate. Their mill's owner, Joerns Healthcare, took away 150 jobs last month by moving operations to Mexico.

Another 170 people making auto sensors at a Sensata Technologies plant in Freeport, Illinois, will be out of work by year's end. Their jobs are being carted off to China.

In each case American taxpayers will subsidize the evacuation.

It's not just cheap labor that pushes work overseas. The U.S. tax code allows companies to expense every last cost of sending your job abroad.

At a time of 8 percent unemployment, one would think Congress would rush to kill a loophole that actually encourages economic misery. One would be wrong.

This summer Senate Democrats introduced the Bring Jobs Home Act, which would kill the loophole and offer a 20 percent tax credit to companies that bring work back to America.

Republicans filibustered the bill to death. Senator Orrin Hatch of Utah went so far as to call the measure "a joke."


3. The behaving-like-an-asshole deduction.
In 1989 third mate Gregory Cousins was negotiating the 986-foot Exxon Valdez through Bligh Reef in Alaska while Captain Joe Hazelwood slept off a bender below deck.

The vessel crashed, spilling upward of 25 million gallons of oil into Prince William Sound. The disaster could have been avoided if the ship's collision avoidance radar was working. It had broken a year before, but Exxon chose not to fix it owing to the cost of repair and operation.

Overnight, 1,300 miles of pristine shoreline turned into a gooey tar pit. The remote locale made cleanup difficult, and 23 years later fish stocks have yet to return to their pre-spill levels.

A court would eventually level $5 billion in punitive damages against Exxon — equal to a single year's profit at the time. The company appealed, chipping away at the sanction until the U.S. Supreme Court slashed that figure to $500 million in 2008.

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12 comments
fancypants
fancypants

@i #have @a hard time #understanding #what you idiots @are talking %about, $why can't *you write a thought !without hitting #shift@one$through*nine?

Mike_a_Mike
Mike_a_Mike

@BobJanz @CaptYonah and Obama has outsourced jobs as president.

Mike_a_Mike
Mike_a_Mike

@BobJanz @CaptYonah he released them. And the IRS would no better than a senator. They have no interest in his taxes.

egolterman
egolterman topcommenter

There are tax loopholes and Tax 'Grand Canyons'. Hundreds of millions a year pour into the Zoo and Museums and Science Center and Gardens for big tax write offs. The money grows and grows in their profit centers (parties, events, banquets) all tax-sheltered. On top of this, to promote and staff this, the taxpayers of St. Louis County layer on $70 million a year. End the Tax, they wont close, they wont charge admission, they wont miss a beat.  

BobJanz
BobJanz

@Mike_a_Mike @CaptYonah Really? Show me one! #Sensata. Trust this over #Fox #Koch Lies and Propaganda http://t.co/XJccE048 #tcot #TPP #GOP

jason1079
jason1079

 @egolterman Burn the museum!! Slaughter the zoo animals!! They are all dragging society down the drain!

mathmagician
mathmagician

 @egolterman

 Yep, Zoos are what is bankrupting this country. Hard hitting journalism... idiot.

Mike_a_Mike
Mike_a_Mike

@BobJanz @CaptYonah simply having an off shore account does mean tax evasion. If u know about the accounts, so does the IRS.

egolterman
egolterman topcommenter

 @jason1079

 No, end the corruption. That's all. End the corruption. Return money to the taxpayers. End the crooked deals. Actually take care of the animals at the Zoo not party guests. Go to the Museum but the Museum is not used to kill MUNY.

Just end the corruption.

 
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