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Our View: Immoral corporate welfare

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  • | 5:00 a.m. February 29, 2012
  • Longboat Key
  • Opinion
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Maybe a good roundhouse to their proboscises might knock some sense into them.

We’re speaking of the Sarasota County Commission members. Over the past two years, they have confiscated $10 million of Sarasota County taxpayers’ money, and, in exchange for promises by business owners to create new jobs, the commissioners have passed taxpayers’ money into the hands of those business owners.

With that pig pot about dry, they voted last week to replenish it with another $6 million of Sarasota County residents’ money. The vote was 4-1, with Commissioner Nora Patterson dissenting. Instead of allocating $6 million, Patterson only wanted to take $3 million.

With this action, once again, the commissioners, along with their “economic development” experts — none of whom, by the way, has achieved any venture capitalist or business status of remarkable merit — have decided which companies among many have the best ideas, plans, products and services to be worthy of taxpayers’ money.

In the free market, they call this process “government picking winners and losers.” And always (i.e. Solyndra), the taxpayers are the losers.

There is no moral or economic justification whatsoever for government to take your wealth (by force of a gun, mind you, aka taxation) and transfer it to a privately owned enterprise that competes in the free marketplace.
People such as Commissioners Joe Barbetta and Christine Robinson and Mark Huey, president of the Economic Development Corp. of Sarasota County, see this as “economic development” — providing corporate welfare under the guise of “public policy” to improve the local economy. The idea, of course, is to hand out capital to companies so the businesses can expand and hire more people — obtaining an (alleged) advantage over their competitors. This in turn is expected to create a spillover effect that will result in the creation of more new local jobs.

The economic development experts say this process is executed under rigorous examinations and follow-up to make sure taxpayers are receiving the proper “return on investment.”

But as we have seen in Sarasota County, it’s a “learning” process. The expected ROI is often mythical. Our version of Solyndra was Sanborn Studios, one of the county’s more notorious economic development flubs. The county gave Sanborn $650,000 with the expectation that Sanborn would create 117 movie-production jobs in three years.

Sanborn outfitted a 20,000-square-foot studio in Lakewood Ranch, but has since abandoned it, laid off several employees and doesn’t exactly appear to be on its way to becoming the next MGM. When it applied for another $500,000 in taxpayer money, the county’s economic development officials had enough sense to turn it down.

There were other losers — Sunovia Energy Technologies, for one ($50,000). And the jobs created from 28 “grants” to various companies have totaled 1,039 compared to 2,323 promised (44%). It’s still early in some cases. Companies received their money in just the past few months.

But even if the jobs materialize — highly unlikely — there still is no justification for taxpayer money financing the expansions of businesses favored by commissioners and so-called “economic development” experts.
Taxpayers should be outraged by this stuff. Consider this one:

Commissioner Robinson is all excited about the $400,000 the county promised recently to an out-of-state medicall billing company that employs 148 people and “is expected” to hire another 215 more over the next two years, according to the Sarasota Herald-Tribune. The company was deciding between Sarasota and Hillsborough County.

Now let’s say you own a medical-billing company in Sarasota County; you’ve been operating here for more than a decade; you’ve paid property, tangible and intangible and corporate income taxes all that time; and you haven’t taken one dime of subsidies from the government.

How can Robinson, Barbetta and Huey possibly justify a handout to the out-of-state company?

There’s more:

With the typical arrogance of government do-gooders, Robinson, Barbetta & Co. are presuming they are smarter than all of us on how best to spend or invest the $16 million they are confiscating from taxpayers.
In effect, they are saying: “If we let you control your own money, you are not as smart as we are creating new business ventures that will generate as many jobs as we will or the kind of jobs we want when we take your money and invest in, say, Sanborn Studios.”

The commissioners can see the companies that come to them for a welfare check. But they cannot see the unknown entrepreneur, maybe even the next Steve Jobs, who is denied capital because of the taxation that occurs.

That may sound far-fetched. But it reminds us of the often told story by the late, great economist Milton Friedman. After Mercedes-Benz won a $350 million subsidy to build an auto plant in Tuscaloosa, Ala., from the Alabama Legislature, Friedman was asked whether this was a wise investment. Think of all the new jobs being created now and in the future, he was told.

Responded Friedman: “Think of all of the jobs not being created by the Alabama people who had to give Mercedes that $350 million. Ask the widow on the fixed income in little Chicasaw, Ala., on the Gulf Coast if she cares about the Mercedes jobs in Tuscaloosa.”

One more time: Stop the corporate welfare. It’s wrong. It’s immoral. Focus instead on reducing the burdens of taxation and regulation. Create a climate where it’s a joy and easy for all to do business.

+ Try using Longboat talent
Here’s one for the Town Hall suggestion box: Before the town of Longboat Key issues a request for bids from consultants to help the Town Commission decide whether and how to change the town’s comprehensive plan and zoning codes, how about looking for that guidance from among the smart residents who live on the Key?

Citizen committees are often disasters, but we would bet there are many individuals on the Key (i.e. Lenny Landau, chief among them) who would do a better job for a lot less money dissecting what needs to be revised than would so-called expert consultants.

Shame on us. Shame on all of the news media.

Feb. 19, 1945, was “D-Day” for the Battle of Iwo Jima against the Japanese in World War II, and Feb. 23, 1945, was the day U.S. Marines raised the American flag on Iwo’s Mount Suribachi — commemorated in that iconic photograph by photographer Joe Rosenthal.

Apparently, none of the news media commemorated either day (we plead guilty), and Longboat Key resident Martin Samowitz was disappointed.

Samowitz, 97, is the oldest surviving U.S. Marine from the Battle of Iwo Jima. A corporal then, he was among the second wave of Marines who stormed Iwo Jima’s beaches on the second day, “D-Day Plus One,” as he put it.

Samowitz recounted his days on Iwo Jima last Thursday, the 67th anniversary of the raising of the flag on Mount Suribachi, for the Longboat Key Kiwanis Club. He also talked about his subsequent years as the founder and owner of the famous Northeast retail chain, Marty’s Shoes.

Asked what it was like to “walk” to the top of Mount Suribachi, Samowitz snapped: “Walk!? He made it as most Marines did — on his knees, elbows and belly. — MW


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