Middle class moochers?

How tax exemptions and subsidies help pay for the American lifestyle.

Sarah Gardner: One of the biggest issues that seems to divide Republicans and Democrats is government -- how big should it be, what its purpose is, and just how much we should rely on it for our well-being. Well, Michael Grunwald's just written a very thought-provoking story for Time magazine that digs into all the many ways in which government subsidizes our lives -- both Democrats and Republicans. A lot of them that go unnoticed. Michael, thanks for joining us as you take a reporting break from covering the Democratic Convention.

Michael Grunwald: Thanks so much for having me.

Gardner: So Michael, what are you doing at the convention?

Grunwald: I'm covering it just like the other 15,000 reporters here.

Gardner: You decided to tackle this story partly by looking at all the things that are subsidized in your own life, you made it rather personal. So paint a picture for us.

Grunwald: Well, I had just written a book about the stimulus and had been sort of stunned by the way that it seemed perfectly logical to people that $800 billion would be completely wasted on people that had nothing to do with them. And I did realize that hey, government is in all of our lives. It's not like this is a maker and taker world. We're all makers and we're all takers. That my housing is subsidized because I have a mortgage interest deduction. That my savings are subsidized because the 401(k) has a tax exemption. That just about every part of our lives is subsidized in some way.

Gardner: So in your reporting was there any subsidy that actually really struck you as outrageous or really shocked you ?

Grunwald: Well I've banged my spoon on my high chair about farm subsidies for years. I think there are about $700 billion in spending that we do that's actually environmentally destructive, that's pretty crazy. And the mortgage deduction, in particular, which again it benefits homeowners over renters; it benefits wealthy homeowners over less wealthy homeowners. That's another one where it may have run its course.

Gardner: So Michael, in the end, what do you want both Republicans and Democrats to take away from your reporting?

Grunwald: It's interesting. There are some critiques from the left and the right that are pretty powerful and true. I think the right has made this case for years that government does weigh more than it needs to and I think that's really true. I live in Miami beach. Does government need to dump sand in South Beach so that tourists and my family can enjoy it more? I'm not sure about that. Certainly, does it need to be subsidizing farmers? Maybe not. At the same time, liberals have made the case that hey, we rely on government a lot more than we think. I think that's true, too. That government really does support us in many ways -- not just outrageous ways, but ways that are part of our everyday lives. I think if both sides could maybe recognize a little bit more that we are makers and we are takers. And the fact that the government does support and maybe it does support us more than we need.

Gardner: Michael Grunwald is the Time magazine's senior national correspondent and the author of "The New New Deal: The Hidden Story of Change in the Obama Era." Michael, thanks a lot.

Grunwald: Thanks so much for having me.

About the author

Sarah Gardner is a reporter on the Marketplace sustainability desk covering sustainability news spots and features.

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