Ensuring We Rely On Politicians
Government is well on its way to ensuring a large segment of the private sector is no longer, well, entirely private.
You may have heard of the proposed new power plant in Marshall County. If built, it will use natural gas to produce about the same amount of electricity now generated at the old Kammer Plant.
But here’s the thing: If the plant is constructed, it will be owned by the Marshall County commissioners and leased to a private company. In addition, the firm will get millions of dollars in tax breaks. Developers say that’s the only way the plant can become a reality.
Remember the single biggest Ohio Valley economic development of the past 10 years? The Highlands in Ohio County could not have been established without a massive infusion of state funding.
Look at any number of stores and factories opened during the past decade – and in which tax increment financing was integral. TIF agreements give businesses tax breaks in exchange for locating in certain places.
Beginning to get the picture? Many – perhaps most – of the economic development during recent years has relied on financial help in some form from government.
Has it gotten to the point that government involvement is essential for new stores and factories?
We know that’s true in some industries. Wind and solar energy facilities rely on massive federal subsidies. Ethanol producers exist primarily because Washington insists gasoline refiners use ethanol.
Some big agriculture businesses are profitable (think sugar) only because of government action.
You’ve heard of “too big to fail” businesses, including some banks and industries such as car makers. Imagine the nice, warm feeling their executives have, knowing that Uncle Sam will bail them out if need be.
Now think about taxes and government regulations. What would the economy be like if businesses didn’t have to cope with that burden? Perhaps they wouldn’t need help from government.
It’ll never happen. And I suspect there’s more to it than revenue from taxes. Some politicians like it this way. It allows them to boast about new jobs they’ve allegedly produced. It makes them seem indispensable.
But are they? Really?
Myer can be reached at: email@example.com.