Strange bedfellows in the fight against corporate welfare | Arkansas Blog

Monday, August 29, 2016

Strange bedfellows in the fight against corporate welfare

Posted By on Mon, Aug 29, 2016 at 11:02 AM

I find myself in league with some unusual allies, including Rep. Nate Bell, in opposition to the legislatively referred constitutional amendment that would pledge state revenues to support huge loans to private business and also legalize taxpayer subsidies of chambers of commerce.

And here I go linking with approval an essay against the issue by Conduit for Action, the ultra-conservative political lobby whose major issue has been fighting Obamacare, particularly the Arkansas private option version of the Medicaid expansion.

Conduit calls Issue 3 of 2016 the most financially irresponsible amendment in state history and there have been some bad ones. It notes that there'd be no limit on taxpayer-backed bonds for corporate giveaways if this amendment takes effect.

What happened to the concept of fiscal responsibility? How can you claim to be fiscally conservative while proposing an Amendment that has absolutely no limit on how much bonded indebtedness the state can undertake for big business super projects?

If a project flops and taxpayers have to repay the debt, a state budget could be wrecked, Conduit says.

Conduit also looks dimily on the provision inserted by chambers of commerce to negate the court ruling that enforced the state constitutional prohibition against taxpayer subsidies to private corporations like the chambers of commerce.  Conduit gets this issue exactly right.

The Chamber’s endorsement of politicians is important so it is no surprise the Chamber was able to get legislators to include a provision in Issue 3 to, in effect, reverse that decision.

Because of the court ruling against the cities giving money to the Chamber, the city of Bella Vista ended its contract with its local Chamber of Commerce. Even worse for the Chamber was the news that Bella Vista and possibly other cities were considering hiring someone as a city employee to do economic development work in-house instead of diverting money to the Chamber. If Bella Vista is successful, it means cities will be the competitor of Chambers and become the Chambers successors in economic development. Imagine that… cities controlling their own money.

Is diverting your local tax money to the Chamber all that bad of a deal? Not if you always agree with their positions on political issues and agree with who they endorse as candidates. Citizens in many cities have battled their local Chamber of Commerce on proposed tax increases and many citizens still disagree with the State Chamber’s support of Obamacare Medicaid Expansion.
Conduit might have less of an issue with chamber lobbying for many of things I view dimily — restricting workers compensation, fighting unions, stripping local control of schools, pushing highway construction to the detriment of neighborhoods. But the principle is the same. Taxpayers shouldn't be paying lobbyists for the business community. They can hire their own.

PS — Fiscal responsibility is situational with Republican administrations. For example, the Hutchinson administration is moving ahead at the urging of Insurance Commissioner Allen Kerr to build a vast new palatial office for Kerr across the street from the Capitol. It's unlikely even creative accounting can show how a land purchase and new construction can be more economical than existing rentals, at least not for many years. But Kerr wants a pleasure dome and Kerr shall get a pleasure dome, unless some of those budget hawks in the majority at the legislature decide a fancy office building is as wasteful as tax cuts for the working poor or no-cost medical care for the impoverished. The Legislative Council must approve the $10 million-plus building (with, of course, a free parking place for every one of the 300 people inside) Jan. 20, but since it has already approved the land purchase and Republicans control the Council, what do you think the vote will be?

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