Tuesday, July 15, 2014

From Earmarks (D.C.) to TIFs (I.C.): America's Fascist Economy

July 15, 2014, 3:55 p.m.
TIFs -- Therrre Back!!
"The people who own the country ought to govern it."

-- John Jay; Frank Monaghan, John Jay, chapter 15, p. 323 (1935).

I like Marc Moen -- including many of his architectural and other ideas for Iowa City.

What I don't like is the City Council's infiltration of the efforts of Iowa City's entrepreneurs, start-ups, established businesses, and capitalism generally by picking and choosing which for-profit enterprises they will infuse with taxpayers' money.

Today's Press-Citizen reports that the Council's latest give-away is going to Marc Moen in the amount of $14 million!! That's a little rich even for the members of Iowa City's City Council. Mitchell Schmidt, "Committee Approves Chauncey Funding Model; Recommends That City Council Back $14.1M TIF Request, Iowa City Press-Citizen, July 15, 2014, p. A1 [Credit for photo of proposed building: Iowa City Press-Citizen.]
Here are some relevant numbers. According to the 2010 census Iowa City contains 67,862 people, 27,657 households, and 11,743 families. Divide $14 million by those numbers and you get: $206.30 per person, $506.20 per household, or $1192.20 per family. Is there the remotest possibility that if the question of making those gifts to Moen from every Iowa City resident was put to a vote that it would ever muster a majority of support?
For nearly a decade I have been writing in newspaper articles and blog essays about the problems with TIFs, providing lists of the categories of their objectionable consequences -- why these transfers are bad for taxpayers, consumers, competitors of the recipients, the general economy, neighboring communities and governments, among other reasons. One column, from this past April, may be a useful summary: "Tussling Over TIFs: Pros and Cons."

A list of 39 of those prior columns and essays can be found in "TIFs: Links to Blog Essays."

Earlier this year I wrote a tongue-in-cheek column essentially throwing in the towel, revealing my misunderstanding regarding transfers of taxpayers' money to for-profit enterprises from earmarks in Washington to TIFs in Iowa City:
"Like 'Amazing Grace,' I was blind, but now I see: We don’t have a capitalist system. We probably never did. So how should we describe our economy? The word 'fascism' carries too much baggage from World War II -- dictators, suppression of opposition, aggressive nationalism, and even racism. 'Fascism' doesn’t describe America today. But from Washington, D.C., to cities, counties and states all across America, in terms of an economy, ours is the economy of fascism."
"TIF Apology."

Whether in Washington, Des Moines, or Iowa City, our elected officials, like Italy's Benito Mussolini 70 years ago, love to intertwine government and business into a kind of fascist economic whole within which, in our time, they can give our money to for-profit businesses. Who wouldn't like to get the credit (plus campaign contributions, and the virtually guaranteed re-election they make possible) for spending other people's money?

And the citizens, taxpayers and voters go along. They may support the idea of TIFs, they may not be paying attention, they may understand and oppose them but figure it's fruitless to protest, that the deck is stacked against them. The net result is the same: the officials are re-elected, and taxpayers' money continues to flow to the relatively wealthy and for-profit businesses.

To make matters worse, Iowa City's TIF-lovers now propose to add disrespectful insult to economic injury, by raising the sales tax (disproportionately borne by the poor and working poor), and shifting most of the income from this sales tax increase to property owners in the form of reduced property taxes -- thereby softening any possible political opposition from them to the TIF giveaways.

Council members' governing principle is similar to that of John Jay (1745-1829), as expressed in the quotation with which this blog summary began: "The people who own the country ought to govern it." Delete the "ought to" from that line and it pretty well describes governing in America today, whether nation, state -- or Iowa City. And those who own Iowa City are the members of the business community and, as in John Jay's time, the property owners.

But until the Council exercises the candor to place Jay's quote over the entrance to the City Hall, openly and candidly acknowledging what they are doing, I will continue to protest the hypocrisy of the community's TIF-funded fascism.
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