If there’s one thing that makes it difficult for small businesses to compete with large corporations it’s corporate welfare. This is money corporations receive in the form of bailouts, secured loans, and tax incentives to engage in what often ends up being risky business practices. Studies show that corporations that know the government considers them “too big to fail” will make business decisions based on the knowledge that the government will bail them out if they get into trouble. Meanwhile small and medium businesses have to make decisions based on the knowledge that they are their own support system, and oftentimes it means they can’t compete.
There are some arguments in support of corporate welfare. It is very likely that auto and banking industry bailouts averted a complete global economic collapse back in 2008, and a lot of that money loaned at least to the auto industry has been repaid with interest. It also sometimes helps out those in need, as it has with the Affordable Care Act supplements that have helped millions of people afford health insurance.
Learn more about corporate welfare from this infographic. Can your company compete with corporations that have seemingly endless help from the government?
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