Friday, February 22, 2008

Corporate Blackmail or How Taxpayers Pockets Are Being Looted in the Name of Economic Development

Here the Journal Sentinel's editorial page goes again on Feb. 22, 2008 pontificating about Oconomowoc's proposed interchange and shopping mall wonderland. The Journal-Sentinel is just so happy to be boosters for taxpayer dollars being spent on private developments. If this such a crucial development and such a can't-miss project, if the market is speaking and telling these wise private developers that they can't go wrong with this plan, why does the public have to pay for it?

This is economic development. We hear so much about how great the free market is and how government needs to get out of the way. Yet every project that a private company moves forward with is in part funded with taxpayers dollars. They have their hand out every time. This form of legalized bribery, what some call employment maintenance and retention policies, where companies play state versus state and city versus city to see who will bid up the subsidy to fatten the blackmail bounty for the company. "Give us money to build here, or someone else will give us money to build there." When is the Journal-Sentinel going to do a multi-part series on this corporate welfare, this looting of public dollars which happens across every city and state?

The editors claim, "Actually, the original expectation for some was that Pabst Farms was going to be a national model for a comprehensive planned development, with commercial, residential and amenities all balanced in green harmony. That dream has fallen by the wayside and is unlikely to be revived to its full extent." Green harmony? Next to an interchange? Alongside shopping malls? This is the comprehensive plan intended to be a national model for how we ought to live?

An even more laughable quote, "Pabst Farms is a critical development for the region. Although plans have been scaled back, it still needs to be done right." I still haven't heard why Pabst Farms is a critical development for the region. It seems that repairing and maintaining the infrastructure we already have, injecting much-needed funds into our schools, rehabilitating blighted buildings and brownfields, and bolstering our public transportation systems are much more important to our regional health and sustainability. These types of development simply mirror the entertainment options we already have in the region. Such developments simply add more sewer lines, more roads to patrol and plow, and merely act as substitutes for identical development elsewhere in the region. This isn't growth. This is a zero-sum game.

People that go shopping at this proposed development are going to be people that are not shopping at Mayfair, the Grand Avenue, or Southridge. People from all over the state and the country are not coming to Oconomowoc to shop. This will lead to a realignment of leisure spending, but no growth will occur. Retail is not economic development. There is a fixed amount of disposable income people have to spend. Retail simply moves this money around. It shuts down competing stores and it does not create jobs. The only location where retail could possibly be implied to be a development catalyst is if it were to take place in an older, disinvested, blighted neighborhood.

Another issues to consider is the pay of the types of jobs created by such development. The jobs will not pay enough for the workers to even afford to live in the homes in the residential part of this plan. It will merely create more seasonal, part-time, substandard or nonexistent health-care benefit, low-wage jobs.

[For a better look at the schemes of General Growth Properties and their ilk, check out Good Jobs First's report Growing At Whose Expense?]

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