Many are temped to assume that money collected by the government goes to help the poor and downtrodden, however, much of that money ends up in the hands of the rich and politically connected, those who have the most resources and ability to lobby for it.

Once money is transferred from the taxpayer to the government, regardless of its intended appropriation, it’s up for grabs by anyone who has the know-how and funds to lobby for it. (Even Social Security taxes, which are supposedly specifically taken out of payroll to be used for Social Security, in reality are “borrowed” for the benefit of the government’s general pool of money and are not set aside for this purpose.) And who has the best abilities to lobby, wealthy interests or poor interests? (Answer: Wealthy)

Therefore, much of the money intended to help the poor, ends up benefiting wealthy and middle class special interests.

The Obama Administration’s attempt to keep stimulus money out of the hands of lobbyists is a prime example of how government hand-outs create a feeding frenzy for lobbyists and how powerless the socialists-in-charge are from stopping it.

On March 20, 2009, the Obama administration issued an order restricting lobby efforts for stimulus money.

The March 20 order bans federally registered lobbyists from requesting details about stimulus funds from government officials in person or by phone. Contacts must be in writing and posted online. But a month after the ban took effect, only a handful of contact reports appear on government Web sites — even though reports filed to Congress last week suggest that 2,500 entities lobbied on the bill last quarter.

However, lobbyists are working hard to find ways around the ban:

In the meantime, the rule has brought in a slew of work for nonregistered lawyers, who can call or meet with officials without submitting requests in writing, lawyers and lobbyists said. Business, public-interest and other advocates must register with the Senate if they spend more than 20% of their time lobbying members of Congress or federal officials.

“Where there’s any issue, it’s just easier to hand it off to somebody who’s not registered,” said Rich Gold, partner in the Washington office of law firm Holland & Knight, and a registered lobbyist. At his firm, “Certainly people are helping out who normally wouldn’t be engaged in this.”

The above excerpts are from an April 28, 2009 Wall Street Journal article by Elizabeth Williamson entitled “Some Lobbyists Try to Skirt Stimulus Ban“.

For more about how and why money intended for the poor ends up in the hands of special interests, please read this excerpt about the fallacy of the welfare state taken from Milton Friedman’s book Free to Choose.