Republicans: Still searching for free lunch for levees and highways while shoveling tax money to private business | Arkansas Blog

Thursday, June 25, 2015

Republicans: Still searching for free lunch for levees and highways while shoveling tax money to private business

Posted By on Thu, Jun 25, 2015 at 12:35 PM

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Other topics stole my attention on my return from vacation this morning, but belated comments are in order on the continuing search for a free lunch by Arkansas Republican politicians.

Examples:

* Sen. Jason Rapert
says the state should do something now about inadequate levees. Gov. Asa Hutchinson urges a go-slower approach. Of course he does. The only complete solution to inadequate regulation and maintenance of levees is more money. Rapert, you may be sure, doesn't plan to volunteer that he and other affected landowners pay for all that protection themselves (as they do on, say, health care). A Republican state legislature or Congress appropriate more money to protect people who develop in flood-prone areas? Surely you jest. Sure, they might wreck Medicare or Social Security to get money to do it. But raise taxes? Assess sufficient fees on the people the levees protect? Not likely.

* Then there's highway funding. A lack of federal high money is reducing construction work. A "task force" is at work in one of Gov. Asa Hutchinson's patented decision-avoidance moves in hopes, I guess, that some manna will fall from the skies to keep the McGeorge construction crews at work at their customary level. Hutchinson whistled past the graveyard in remarks to reporters yesterday:

"My expectations are for the state of Arkansas to be creative in [coming up with] additional revenue streams for developing our highway infrastructure," he said.

He hopes, first, for federal salvation, where more efficient cars and a highway fuel tax that hasn't kept pace with inflation have depleted the mother lode of highway money. Fact: there is no "creative" solution to the state's share. It can either raise taxes — it should, and a fuel sales tax would be one good way to do it — or it can steal money from other needs — schools, colleges, prisons, health care, public safety, city and county government — to put it in the contractors' pockets. A tax increase is a non-starter with this legislature (except maybe on poor people), so the choice is stealing from others or spending less on highways (this might not be a bad idea, given where some state money has been spent in a state system with far too many miles under state care.).

Here's an idea on saving money. Stop giving it away to private enterprise.

I thought of Asa Hutchinson's big corporate welfare giveaway to Lockheed Martin today when I read Gayle Collins' column in the New York Times about the extortion schemes of companies in other states where Republican governors who hate taxes and fail to provide adequate public services have been shoveling tax money to private companies for dubious economic returns. Several have done what Arkansas and Little Rock just did, gave big sums to private outfits — the taekwondo association in Little Rock's case — to match a corporate welfare offer from another state. Not to create many, if any, new jobs, but to keep existing jobs. Articles on the taekwondo group's groundbreaking for a new building said it anticipated 15 to 20 new jobs for the $1.3 million or so in handouts the state and city are providing.

Louisiana has been all but bankrupted by its handouts to corporations. Some states are giving away millions to companies that promise to keep half of their jobs in the state — they actually paying to lose jobs. Collins says this extortion should be outlawed. Good idea. It's the only way to protect taxpayers from politicians happy to give away their money to private businesses but not to spend it on the welfare of citizens. All the while they are waiting for miraculous pennies from heaven for levees and highways.

Wrote Collins about themes I've also advanced before:

The great irony here is that finding the lowest taxes generally isn’t a top business priority. What companies really want is to be near suppliers and markets. Maybe occasionally the C.E.O.’s house. “As a part of business cost structure, state and local taxes are about 2 percent,” said Greg LeRoy, the executive director of Good Jobs First, a nonprofit that tracks these programs.

But tax cuts do help make friends. In Wisconsin, the State Economic Development Corporation board — which Scott Walker used to lead — approved a $6 million tax credit for Ashley Furniture Industries, whose owners forked over $20,000 to Walker’s re-election campaign. As The Wisconsin State Journal reported, in return for the tax credit, Ashley Furniture promised to expand the company headquarters and keep at least half of its current jobs in the state for the next five years. Doesn’t that sound like a kind of low bar?

Under Chris Christie, New Jersey has handed out $630 million to get companies to move jobs to the woebegone city of Camden. Which would seem like a worthy goal, except that most of the jobs in question were already in the state — in fact, frequently in an adjoining neighborhood. “Most of the jobs coming to Camden are filled by existing employees who currently work just a few miles away,” reported The Associated Press. “Nearly all the recipients boast notable political connections.”



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