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JP Morgan Chase & Co. will receive over $750 million dollars in rent subsidies from New York City and state authorities as an incentive to relocate its offices from Midtown Manhattan to ground zero.
Each year for the next 15 years, the banking giant will be granted $50 million in rent subsidies, as well as tax breaks
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JP Morgan Chase is ranked 11th on the Fortune 500 list of the largest U.S. companies. It is the third largest commercial bank. The company has assets of $1.4 trillion and its annual revenue is $100 billion. In 2006, JP Morgan Chase reported $14 billion in profits.
Government officials justified this outrageous “corporate welfare” package as a way to reestablish lower Manhattan as a world financial center in the wake of Sept. 11, 2001.
In 2005, another banking giant, Goldman Sachs, received $650 million in subsidies from New York City officials to build its headquarters Battery Park City.
Meanwhile, New York City’s poverty rate has averaged 1.7 times the overall United States rate for over the last 25 years. Nearly one-third of the city’s children officially live in poverty. In reality, the number is much higher.
Since the late 1990s, earnings for New York City working families at the lower rung of the pay scale have fallen by 14.3 percent. (Community Service Society, 2006)
Monstrous disparities like these are inherent under capitalism. While billion-dollar corporations enjoy subsidized rent, discounted electricity and tax breaks, working-class people are left to fend for themselves. As Karl Marx stated in “Capital,” “[I]n proportion as capital accumulates, the lot of the laborer, be his payment high or low, must grow worse.”
Capitalism encourages a society in which the richest two percent of the world own half the world’s wealth. In the United States, the richest 20 percent own 84 percent of wealth, leaving 80 percent of the population to scramble to get a piece of the remaining 16 percent.
This is why capitalism must be overturned. Only then can society be reorganized to meet human needs, rather than for corporate giveaways and maximizing profits.
