Questionable Economic Impact Claims

Wisconsin Department of Tourism claims $321 million economic impact from Republican National Convention. 

As Center Square clarified:

Economists who have studied the impact of national party conventions says a report from the marketing firm Tourism Economics does not accurately reflect the actual impact of the 2024 Republican National Convention in Milwaukee.

Economist Victor Matheson of College of the Holy Cross has studied and written on national conventions and large events, He called the release, which claims the event had a $321.5 million impact, a “promotional booklet/press release, not a serious economic impact study.”

Center Square, in other economic impact reporting, further noted:

Economists say the numbers produced by the marketing group do not follow economic study principals and are not reputable. The numbers are used by politicians and state tourism departments to justify spending.

“Viewing what ‘economic impact’ consultants do to be economics is like considering horoscopes to be astronomy,” economist J.C. Bradbury of Georgia’s Kennesaw State University recently wrote. “Newspapers are smart enough to put horoscopes next to the comics and Dear Abby, while economic impact ‘studies’ get banner headlines on the front page.”

Bradbury noted economic impact analysis is not something real economists do and there is a reason that work is not presented at conferences or published in journals.  

Economic impact is often claimed surrounding publicly funded sports stadium projects or sporting events.

The annual tourism reports are paid for by state tourism departments and national tourism agencies.

Urban Milwaukee reported:

But when the Common Council discussed the RNC in September, it wasn’t as favorable.

“It didn’t trickle into the neighborhoods,” said Ald. Marina Dimitrijevic of the economic impact.

In an email to Dimitrijevic, LuLu Cafe & Bar owner Cameryne Roberts said the RNC didn’t result in a business boom. “For what it’s worth, the RNC was a complete bust for us and most of the other Bay View business owners I spoke with, not to mention those in other parts of town.” 

Alderwoman Milele A. Coggs asked for the final report to include a geographic breakdown and diversity data. “I just want us, as a council, in case we’re asked again to sign on to anything like this, to be aware of its impact. And where things might not have been how we wanted it to be, or we might not have achieved the goals we were going to achieve, that we recognize that and that we work differently in the future to better achieve those goals,” said Coggs. The final report does not include the breakdown requested.

Reports during the convention highlighted how many businesses outside of the hard security perimeter were seeing lackluster business. Across the month of July, sales tax revenue in Milwaukee was actually down year over year. But the state, which collects the revenue, does not collect data by week.

Per usual, many of these economic-impact no-brainers (conventions, stadiums, Olympics, etc.) which are touted to be win-wins for cities and states are anything but.  

Trickling Down or Just Getting Pissed On

Socialism for the rich and capitalism for the poor. Milwaukee's new Economic Development Commissioner wants to double-down on corporate welfare.

Milwaukee officials consider higher incentives to bring businesses downtown

According to the new Commish, "The city is exploring more aggressive policies to incentivize job creation and investments in the downtown area. Those could come in the form of employment incentives using the city’s main economic development tool, tax incremental financing, for example. Or it could involve new ways the city could help growing companies recruit workers to fill new jobs."

There's no money for potholes, we can't fast-track lead pipe removal, workers can no longer have affordable health care or secure retirements, a living wage is too much to ask, we can't upgrade public infrastructure, but there's endless and increasing money to giveaway to corporations.

Improving the roads and transportation options, upgrading broadband, updating the electrical grid and sewer system, greening public buildings, along with numerous other public projects, would go much further toward growing Milwaukee's economy than simply giving "incentives" to already profitable corporations.

For Further Reading:

Open For Business?

Ticked Off About TIFs

Development Gone Astray

The Con That Is Foxconn or How Republicans Learned To Stop Worrying And Love Socialism For The Rich

Job Piracy

Privatizing The Profits, Socializing The Loses

There the "free" marketeers go again. Milwaukee real estate execs question Housing Authority's high-rise plan.

So, the City is booming. Development, jobs, tourism, new businesses...things are looking up.

As usual, when things start to gentrify, certain people are priced out of the market...yet those workers are still necessary for the booming economy to exist.

Enter affordable housing. Another policy answer to a society that doesn't pay a living-wage. If you're not going to pay a downtown-wage for a downtown-worker, public policy steps in to subsidize and correct the market.

It's as much a subsidy to the employer as it is to the worker. By subsidizing the housing of these workers, the government is allowing the employer to pay below-market wages.

Also, as usual, and wanting to have it both ways, local developers are complaining when the government steps in to correct the market. The Milwaukee Business Journal reported, "The Housing Authority in April introduced its plan, which calls for spending up to $150 million on a high-rise tower with 350 apartments, a mix of market-rate and affordable units."

Tim Gokhman, director of New Land Enterprises, told the Business Journal:

He said if the city has figured out how to generate a profit from a high-rise to subsidize affordable units, “teach the rest of the market how those profits can be attained.”

Because the profits aren't high enough for private developers, because the returns on investment aren't elevated enough, because the government won't just give them the money to do it, private developers are complaining when the government enters the market to provide needed housing for citizens. (Privateers complain when the government does any of the many things the magic "free" market won't do.)

Developers can't have it both ways. They can't claim they're the experts - the "free" market and the private actors have all the answers and will provide as long as the government stays out of the way. But then, in the very next breath, they come to the public for giveaways, tax breaks and other hand-outs they claim the need for their projects.

If the public has to give tax cuts, subsidies and incentives to private actors to get them to do something, why shouldn't the public entity just complete the project?

The private sector does some things well. But it's time we re-realize the same can be said for the public sector.

How Corporate Welfare Hurts You

Amazippi

Scott Walker Screwed Wisconsin ... Again

Scott Walker and Wisconsin Republicans are just terrible, stupid, selfish, greedy and soulless people. Their policies (along with all other Republican policies) continue to waste taxpayers' dollars. Who are these people voting for Republicans that take citizens' tax dollars and give it to rich plutocrats? Why do people continue to support such an obvious transfer of wealth from the majority of citizens to the richest? 

The failure of Republicans policies has been persistent. What type of delusion or cognitive dissonance makes people continue to hope these Republican policy lies will finally help them? All of the empirical evidence from the last 50 years shows that the policies the Republicans are spouting hurt all but the richest Americans. 

And now we have another example from Scott Walker. Another failure in a long line of Scott Walker failures. 

As most everyone looking into the boondoggle that is Foxconn concluded, the chances of this corporate welfare working were slim to none. And now, Foxconn is changing their plans. The promised LCD manufacturing plant is now morphing into a smaller R&D technology hub. Yet another great example of Republican governance - funneling public dollars to private paymasters with no accountability or concern for the outcome. As opposed to the typical Democratic governance, whereby public investment actually generates public benefits - think schools, roads, airports, trains, health care, etc. 

For Further Reading:

Foxconn reconsidering plans to make LCD panels at Wisconsin plant

Foxconn may not build a factory in Wisconsin after all, says top company exec

Foxconn Shifts Focus From Wisconsin Manufacturing Plan
Foxconn changes focus of massive Wisconsin project
Foxconn scraps plan to build $10 billion Wisconsin factory Trump bragged about
Ruinous Walker's Downfall
Blasts From The (Deceptive) Past: Scott Walker Edition

For a more in-depth reading of all that was wrong with the Foxconn giveaway, see The Con That Is Foxconn or How Republicans Learned To Stop Worrying And Love Socialism For The Rich.

Scott Walker Is Bankrupting Wisconsin

The Governor of Giveaways:

Walker is using government to build the economy, and on a scale that has never been equaled in Wisconsin history. No governor in state history, Republican or Democrat, has come close to spending so much in taxpayer dollars to subsidize one business, with the total handout for Foxconn now at nearly $4.1 billion. In fact, no government in America has ever spent this much money to subsidize development by a foreign business. 

Under Walker, it’s almost as though the private sector can no longer function without government handouts. The state handed out subsidies to 59 companies in 2017 alone.

And the amount of subsidy keeps growing. Walker, is spending eight times more tax dollars per job created for Foxconn than he was previously spending, as the Journal Sentinel found. But the actual total of $315,000 per job spent on Foxconn’s promised 13,000 jobs is 12 times higher than Doyle spent per job (about $25,000) for Mercury Marine and 217 times higher than Republican Gov. Tommy Thompson spent ($8.25 million for 5,700 jobs) to subsidize General Motors In Janesville in 1988.

Go read the entire article. Walker and his Wisconsin Republican cronies have no clue regarding economic development or the economy. They are simply dutiful little soldiers using Wisconsin taxpayers' dollars to enrich their cronies and campaign contributors.

This is not leadership. This is not governance.

Class Warfare

If you do drugs and you're poor we'll throw you into the streets. Actually you will just lose your unemployment benefits. But if that's your only income, you'll probably end up in the streets.

But, if you're wealthy and you received subsidies, giveaways, tax breaks, low-interest loans and a host of other handouts from taxpayers; and your casino-type speculation helped bring down the world economy; don't worry about punishment or an end to the giveaways. In fact, we'll find ways to make the poor and working-class citizens sacrifice even more so that you can have more handouts from taxpayers.

If you smoke a joint you will no longer receive your less-than-$300 weekly unemployment check. Yet, if a corporation's greed and speculation (partially funded by taxpayers) happens to collapse the economy, it's perfectly OK for that CEO to spend $1.2 million to redecorate his office, while continuing to receive taxpayer dollars. This dichotomy perfectly illustrates the inequity of our public policies.

American "democracy" at its finest.