Economic Development = Corporate Welfare

Libertarians oppose grants of relief or exemption to taxation specifically designed to benefit particular politically favored businesses or individuals.

Corporate Welfare Archives

'Where is the government spending irresponsibly? "Corporate welfare," answered Brogdon as an immediate example. The governor's Opportunity Fund and EDGE Fund were specific examples he cited. "It's not right for the state government to spend money to handpick which companies are going to prosper...If I was governor and I was going to make that decision, I would set a level playing field and set up a free market."'
- Senator Randy Brogdon (R-Owasso) in The Urban Tulsa
The Oklahoma Supreme Court struck down the corporate welfare "Opportunity Fund". By allowing two legislative leaders to decide which companies will benefit from our taxpayer dollars, the law violates the constitutional separation of powers. "The extra-constitutional method by which the Legislature extends its tentacles of control over an appropriation measure beyond the time when the measure stands transformed into enacted law offends the constitutional concept of separated powers and becomes a usurpation of power," the court ruled.

Richard Robinson writes in the Gazette about the $557 million Crosstown Boondoggle: "You can reroute heavy trucks off onto Interstate 240 (which can handle the capacity) and re-deck the current bridge with state-of-the-art materials for a fraction, instead...[t]he corporate welfare leaches want this project because of the sheer amount it's going to cost, funded, of course, by us - the unsuspecting taxpayers."

Oklahoman taxpayers pay from $11,500 to $32,000 for each new new job (while current employees foot the bill).

According to Senator McCain (pdf),"Ethanol is a product that would not exist if Congress didn't create an artificial market for it. No one would be willing to buy it. Yet thanks to agricultural subsidies and ethanol producer subsidies, it is now a very big business -- tens of billions of dollars that have enriched a handful of corporate interests - primarily one big corporation, ADM. Ethanol does nothing to reduce fuel consumption, nothing to increase our energy independence, nothing to improve air quality."

And you thought there was no such thing as a free lunch...The Gazette's Best of Issue lists "Best Misuse of Tax Dollars".

Taxpayers will finally stop paying Great Lakes Airlines $231.71 per passenger to fly to Enid $338.81 to Ponca City. Story in the Enid News.

Kurt Hochenauer says that subsidizing professional teams with with taxpayer funded arenas is corporate welfare in a Gazette commentary. (Note: He uses "conservative" where "special interest" might better describe these redistributive policies in general.)

Oklahoma Senator Randy Brogdon says giving Tax Credits is Corporate Welfare.

Why are Tulsans paying for corporate welfare? See the Tulsa Libertarians Vision 2025 page. Richard Robinson thinks Oklahoma should stop subsidizing the trucking industry and make them pay their fair share.

Arena $30 million over budget and corporate welfare supports Shangri-La: This is Tulsa's Vision 2025. See Bateslines and Urban Tulsa.

If you build it they will come...Gov. Henry tries to stymie runaway tax credits. One more reason for a FairTax system, without all the special interest exemptions.

Another unfair Oklahoma income tax exemption for new residents was rejected by a Senate committee. A fairer plan was expressed by Bob Clark's suggestion to end the income tax altogether.

California Republicans Don't Want Competition: bowing to special interest groups, they say a successful program to make paying taxes more efficient "violates the proper role of government."

Robert Denny thinks spending public money on private roads is great...for special interests. (Rep. Terrill's House Bill 2807 applies only to new gated communities that keep gates open during the day.)

Senate rejects partially-private property: publicly funded gated roads measure fails.

Stage Center will lean on a city subsidy to stay open.

Dr. Robert Taylor questions America's economic future.

The latest Bad Deal for Taxpayers wrapped in Sheep's Clothing

On March 4th advocates of "personal responsibility" will ask us to vote on whether or not wealthy interests should have to pay to build their own facilities here in the city for the Sonics basketball team that is probably coming to town. I am, as you can imagine against this, and feel that it is time to quit playing nice and launch a serious offensive against these hypocrites. Next month The OMAA [Oklahoma Media Awareness Alliance, www.theomaa.org] is going to try and put on a large evening discussion event on the matter, with all sorts of speakers and ideas on how to make sure this vote does not pass. I could say a lot, but Dave Zirin has written a fabulous piece on the matter that I would love for everyone to read.

I am considering a door to door campaign, get volunteers to take literature to folks (including the Zirin piece) and talk to them about this.....let me know what you think!

-Steve H

Sports columnist DAVE ZIRIN reports from Washington, D.C., on how cities and states have been ripped off to build sports stadiums and arenas.

IN THE weeks before the state legislature's vote on funding for a new baseball stadium, the Minnesota Twins ran a TV commercial featuring a ballplayer visiting a boy in the hospital. A voiceover announced, "If the Twins leave Minnesota, an 8-year-old from Wilmer undergoing chemotherapy will never get a visit from [Twins infielder] Marty Cordova." It turned out that the boy had already died by the time the commercial aired. Whoops. But lying about a cancer-stricken child is small potatoes when it comes to the depths pro sports owners will sink in their drive for publicly funded stadiums.

Pro arenas paid for on the public dime now dot the country--monuments to corporate welfare. The process is outright extortion: A major sports owner threatens to move his or her team, and demands that city or state taxpayers put up hundreds of millions of dollars to build a stadium that would be owned not by the city, but by the team's owners. Imagine if you wanted to move to a new town and demanded that your neighbors build you a home for the privilege of having you move in, and you begin to see the insane logic.

Over the last 20 years, working people in this country have paid an average of more than $500 million a year in stadium construction and upkeep costs, for a total of more than $7 billion spent on new facilities by 2006. And this doesn't include the $600 million that Washington, D.C., just pledged to build a baseball stadium for the newly named Washington Nationals (formally the Montreal Expos).

D.C. just laid off 300 public school workers, closed its only public hospital and has an infant mortality rate that is worse than every country in the Western Hemisphere except Haiti. The proposed site is an impoverished section of the city called the Anacostia Waterfront. Building the stadium will involve destroying low-income housing and homeless shelters under what is called, without irony, "fair use."

The D.C. stadium swindle moved forward even though 70 percent of the city oppose the proposal, and more than half strongly oppose it. These numbers cross all ethnic and racial lines in this heavily segregated city. This opposition remained consistent even though Major League owners--and their shill, D.C. Mayor Anthony Williams--continue to sell the fiction that the stadium will provide major economic benefits. This is pure folly, not only in D.C. but around the country.

According to a report by the Brookings Institute, "No recent facility has earned anything approaching a reasonable return on investment. No recent facility has been self-financing in terms of its impact on net tax revenues...[T]he economic benefits of sports facilities are de minimus."

As Roger Noll, co-author of the book Sports, Jobs and Taxes: The Economic Impact of Sports Teams and Stadiums, put it, "Any independent study shows that as an investment, it's silly. If they're trying to sell it on the grounds of actually contributing to economic growth and employment in D.C., that's wrong. There's never been a publicly subsidized stadium anywhere in the United States that had the effect of increasing employment and economic growth in the city in which it was built."

Cleveland is another loser in the stadium swindle. This former industrial city was once used as an example for how publicly funded stadiums could turn cities around.

In 1990, Cleveland's Central Market Gateway Project promised in full-page newspaper ads that a new sports complex would generate "$15 million a year for schools for our children." Instead, the Cleveland Teachers Union has calculated that tax breaks given to the project drained $3.5 million a year from the Cleveland school system, which is now in receivership. Cleveland was also recently named the poorest big city in the U.S., with a poverty rate of 50 percent and unemployment hovering at 33 percent.

The truth is that stadiums help nobody but the sports bosses and their political cronies. When Baltimore Ravens owner Art Modell secured funding for his $300 million playpen, he commented--in a rare moment of candor--to reporters, "The pride and presence of a professional football team is more important than 30 libraries.” Maybe for Modell, but growing legions of people disagree.

The owners' friend in the White House THEY DIDN'T think he was good enough to be their commissioner, but Major League Baseball's cabal of billionaire owners ponied up the dough to keep George W. Bush in the White House. A recent Associated Press article found that Bush--a former co-owner of the Texas Rangers baseball team--had his palm greased by over half of the 30 major league teams. Seven owners even hold the distinction of being "Bush Rangers"--meaning they raised at least $200,000 each--and six are "Bush Pioneers," signifying $100,000 a piece.

Owners love Bush for a more complex reason than the usual ardor that billionaires have for their tax-cutter-in-chief. They all want to get taxpayers to pay the tab for new state-of-the-art stadiums--and no one ever fronted a stadium swindle better than George W. Bush.

Bush set the standard for large-scale extortion when his ownership group got the state of Texas to pay for the Ballpark in Arlington. After an adult life of professional incompetence, Dubya had finally gotten his dream job as a managing partner of the Rangers. For an initial investment of $600,000--borrowed, of course--the then-president's son endured the toil of attending home baseball games and smiling a lot for the cameras.

As Bush smirked his way through his forties, the owners behind him (think a dozen Dick Cheneys in ten-gallon hats) threatened to move the team if the city of Arlington didn't pay for a new park. The local government caved. In the fall of 1990, it guaranteed that the city would pay $135 million out of an estimated cost of $190 million. The remainder was raised through a ticket surcharge. In other words, local taxpayers and baseball fans footed the whole bill. This plan was sold to Arlington voters with Bush's glad-handing help.

At the end of the day, the owners of the Rangers, including Bush, got a stadium worth nearly $200 million without putting down a penny of their own money.

But the scam didn't end there. As part of the deal, the Rangers' ownership was granted a chunk of land in addition to the stadium--land that, of course, increased in value as a result of the stadium’s construction. To make this happen, Democratic Gov. Ann Richards signed into law an extraordinary measure setting up the Arlington Sports Facilities Development Authority (ASFDA), which had the power to seize privately owned land deemed necessary for stadium construction.

"Never before had a municipal authority in Texas been given license to seize the property of a private citizen for the benefit of other private citizens," wrote investigative journalist Joe Conason. "On November 8, 1993, with the stadium being readied to open the following spring, Bush announced that he would be running for governor. He didn’t blush when he proclaimed that his campaign theme would demand self-reliance and personal responsibility rather than dependence on government."

Bush held onto his stake of the team as governor, and by the time he cashed out in 1998 for $15 million, Bush's return on his original $600,000 "investment" was 2,400 percent.

So the next time someone complains about the "greed" of pro athletes, tell them that if they want to get bent out of shape about someone's undeserved wealth, they should take a detour to the upper deck and boo outside the owner’s box.

Organizing against these rip-offs WHEN SPORTS owners and their media prizefighters are confronted with the mountains of statistics showing that publicly funded stadiums are fool's gold, they say, "People want their sports, and we're just giving it to them." True, sports are insanely popular in the U.S. But ordinary people have shown time and again that they can distinguish between loving a team and not wanting to be taken to the cleaners by the billionaire bosses.

Polls show that up to 80 percent of people oppose public subsidies for stadiums. Stadium funding referendums have been defeated in both "red" and "blue" states, from California to Minnesota to Virginia. But since polls and public opinion haven’t been enough to shut the gaping maw of the ravenous stadium beast, organizations--ranging from lobbying operations to grassroots protest movements--have popped up around the country to fight against these temples of corporate greed. The groups (courtesy of the Web site fieldofschemes.com) include: Save Fenway Park! (Boston); People for Fair Development and Develop Don’t Destroy (Brooklyn); No Jones Tax (Dallas); No Stadium Tax Coalition (Minnesota); Taxpayers Against an Anoka County Vikings Stadium (Minnesota); hellskitchen.net (New York); Hell’s Kitchen/Hudson Yards Alliance (New York); New York Association for Better Choices (New York); Coalition Against Public Funding for Stadiums (St. Louis); and No D.C. Taxes for Baseball (Washington, D.C.).

Fighting stadium giveaways can raise big questions for people about the priorities of a system that will spit shine sports arenas while schools and hospitals crumble. All people who believe in human need over corporate greed should join the fight.

Read the Edge of Sports You can read Dave Zirin's weekly column on sports at www.edgeofsports.com on the Web. And look out for his upcoming collection of sports writing, What's My Name, Fool: Sports and Resistance in the United States, to be published by Haymarket Books.

About 800 jobs may be created across state

By Paul Monies
The Oklahoman

Businesses stand to receive millions in payroll rebates through program A Tulsa technology company on the verge of a major announcement and an Enid call-center product manufacturer are among the latest companies to qualify for the state's Quality Jobs program, the Commerce Department said Monday. OnviSource Inc. of Enid plans to add more than 225 jobs in the next 10 years and could qualify for quarterly cash rebates totaling $2.6 million during that period, the department said.

The company has more than 100 employees who make call-center technology and work at a call center in Enid. Jon McNaught, the company's general counsel, said OnviSource intends to use its position providing both people and products to grow its client list.

Internet technology company Vidoop LLC in Tulsa intends to add more than 500 employees in the next 10 years. If all those jobs are created, the company could qualify for more than $8.35 million in Quality Job rebates.

Joel Norvell, Vidoop's president and chief executive officer, said the company is poised to announce its plans in the next few weeks.

Vidoop has been in development for 13 months.

Norvell said various confidentiality agreements prohibited him from describing the company's product other than it deals with Internet security.

Also qualifying for rebates was Ventura Refining and Transmission LLC in Thomas. The company intends to create 42 jobs and could qualify for up to $1.35 million in Quality Jobs payments.

Ventura Refining's product line will include gas oil, diesel, kerosene and jet fuel. Ada's Tornado Alley Turbo Inc. qualified under the Small Employer Quality Jobs program, the Commerce Department said.

The company, which has more than 50 employees, expects new work from turbo modifications to the engine for the Cirrus SR-22 plane.

Tornado Alley Turbo could create more than 25 jobs in the seven-year life of the contract and be eligible for cash rebates of more than $290,000 during that period.

Quality Jobs provides quarterly rebates of up to 5 percent of payroll for companies that create or expand employment.

The Gazette's "Best Misuse of Tax Dollars" Winners 2006

Tax Credits - A tax incentive program was suspended this year after investors used it to bilk the state. State costs to the program shot up form $2 million a year to $62 million. What were these investors doing? Oklahoma Tax Commission spokesman Tony Mastin told the Tulsa World that "investors can put up as ittle as $1 million, then borrow an additional $9 million for a total investment of $10 million. Based on the figure, investors can receive tax credits worth $3 million. They pay off the $9 million loan and end up with tax credits worth three times as much as their initial investment." Money for nothing.

#2 Best Misuse of Tax Dollars: Interstate 40 Crosstown location
#3 Best Misuse of Tax Dollars: Brad Henry's Vegas vacation