Your Opinion: Regressive tax will aid boondoggle
Sunday, February 5, 2012
The Transformation project has two main things wrong with it.
First, the plan is to increase the city sales tax. Sales taxes are regressive, that is, they are most burdensome on those least able to pay. That is wrong. In these hard times sales taxes should be lowered, not raised.
Second, the project proposes a $17 million boondoggle that will benefit the few at the expense of the many. I am referring to the conference center. Conference centers are typically money-losers.
Gus Wagner, campaign manager for Transformation, said in this newspaper, “Conference centers traditionally do not make money themselves, which is why they are built by municipal governments. What does make money are the hotels, restaurants, gas stations and coffee shops.” (News Tribune, Jan. 22, p. A15) The Wall Street Journal confirmed this view — “Have We Got a Convention Center to Sell You!” (WSJ, Dec. 23, 2011)
If the real point is to help the downtown restaurants and hotels, it would be much less expensive and much simpler for the city just to give them direct subsidies rather than build a $17 million white elephant.
Aside from the restaurants and hotels, the ones who will make a lot of money on this project are the brokers and bankers who will manage the bond issue, which will likely be needed to raise immediate cash for the construction of the conference center, and, of course, some big outof-town construction firm.
We should not be raising a regressive tax to finance a boondoggle designed to help only a few people.