The Soft Bigotry of Low Expectations or: How I Learned To Stop Worrying and Love Scott Walker's Incompetence

Gov. Scott Walker Holds Down Gas Tax - And Growth

In violation of conservative "pro-market" economic principles, Gov. Scott Walker has once again decided that Wisconsin's gasoline tax will not be raised. Instead, to finance road maintenance and repair, he prefers to borrow $850 million, adding that amount to the state's debt. Since even this large amount of borrowing will not be sufficient to finance the projects being planned for the coming year, he says that some will have to be slowed down or not even begun.

Let Milwaukee Bucks Owners Pay Their Own Way

Under the current plan, private investors would own the team franchise (an appreciating asset with high upside potential) while taxpayers would support an arena (a depreciating asset with a considerable downside). A better deal for taxpayers would be to treat them like investors with an ownership share in proportion to their contribution, entitling them to gains and not just losses. In particular, they would share in the gains in franchise value if the team left town after they built an arena.  ...

It is time to pivot away from attempts to gain tax support for the depreciating asset of this business. The economic recovery has been very kind to the high-income owners; they should fund the entire business, both the franchise and the arena. [source]

Give Taxpayers Better Deal On Milwaukee Bucks Arena

Give taxpayers a better deal on Milwaukee Bucks arena

To break the logjam, here's a hybrid solution that does not require tax gimmicks or out-sized estimates of the public benefits of having a sports franchise: Let taxpayers be investors with a chance to gain, rather than be donors with a guaranteed financial loss. Offer them the opportunity to earn the same rate of return on their tax dollars as the private investors earn on their investment as the value of the franchise rises over time. Their share of the gains could easily be remitted back to the taxing authority and used for needed public purposes and/or tax cuts. 

The current NBA business model separates the franchise investment from the arena investment. The franchise is an appreciating asset, as demonstrated by the recent huge increases in franchise sale prices. In contrast, the arena is a depreciating fixed asset, as demonstrated by the claimed worthlessness of the BMO Harris Bradley Center after only 26 years. Under the taxpayer-as-investor proposal, the taxpayers would share in any future capital gains in proportion to their investment in the total value of the enterprise.