BuckeyeBlog

Your tax dollars are being used to give a little welfare to Warren Buffett:

NetJets Aviation and sister company FlightSafety International were formally awarded state job-creation tax credits valued at $26.4 million yesterday.

The credits were part of $67 million worth of incentives offered in March to persuade NetJets to keep its base in Columbus. …

Retaining the two companies, both controlled by billionaire Warren Buffett, is expected to save 2,000 jobs in Ohio and generate more than 800 jobs in the next several years.

This kind of thing puts Mr. Buffett’s opposition to the repeal of the estate tax in perspective: if the government was confiscating less of your money it wouldn’t be able to give these cushy tax breaks to companies he owns.

Governor Strickland wants the state to review whether an agreement between DHL and UPS would violate anti-trust laws. It seems that his main issue is not whether the agreement would be good for consumers or whether it would really be anti-competitive, but instead is aimed at pressuring DHL to keep using facilities in the Wilmington area that employ around 6,000 people. And how does Strickland justify this move? “I think DHL has an obligation to the community and to the state, because we have tried to work in such a way as to be good partners,” he says.

He is referring to this:

The Dayton-Montgomery County Port Authority in March 2007 sold $270 million in bonds to support DHL’s expansion and upgrading of the Wilmington hub in recent years. That requires DHL to repay the bonds over 40 years, which would put pressure on the company to find a new use for the one-million-square-foot Wilmington sorting facility and airport if jobs are lost there and it generates less revenue, said Ron Parker, the port authority’s executive director.

So the port authority gave some welfare to DHL and now the Governor is using that to justify pressuring DHL into keeping a (possibly) unaffordable and inefficient cargo operation open? While I deplore the governor’s use of his office’s power to strong-arm DHL or any company, I have a little less sympathy for DHL because of its acceptance of a government handout to fund its expansion. After all, he who pays the piper calls the tune. Companies that seek handouts from the government (financed using your tax dollars) should expect opportunistic government officials to meddle even more in their affairs than is normal.

The Lima News has a great editorial taking on corporate welfare for Chuck E. Cheese:

Beth Granger, a project manager for the West Central Development Corp., last week told Allen County commissioners an application for a $500,000 Community Development Block Grant is apparently to bring a Chuck E. Cheese restaurant. The county would get the grant and then fund Smiles Food and Fun of Lima LLC through the revolving loan program. The $2.1 million project would create 30 jobs. We’re guessing they won’t be the high-paying manufacturing jobs that development officials use to justify spending tax money on private enterprise.

Such an eatery already exists here, and just down the street from the Elida Road location where Chuck E. Cheese will open. But, government assisting the one business gives it a taxpayer-provided advantage. Such is the joy of Community Development Blockhead Grants.

Buckeye Institute advisor James Stotter wrote about the folly of government economic development here.

NBC4 reports Gov. Strickland defended the loss of taxpayer dollars in the Skybus failure thusly:

“We should not stop trying to move Ohio’s economy forward and take the risk necessary to do that. That’s a part of our free enterprise system,” said Ohio Governor Ted Strickland.

Actually, Governor, the phrase ‘free enterprise’ system refers to a system free from government interference such as the picking and choosing of winners and losers in the economy because of their political value to politicians instead of their economic value to citizens. Government entanglement in private enterprise to the tune of millions of taxpayer dollars is state socialism, pure and simple, and not the ‘free enterprise’ you repeatedly pretend it to be.

Please stop giving the engine of our state’s and country’s prosperity today a bad name by confusing it with the failed policies better suited to the tastes of people living less free lives, more dependent on government, than do Ohioans and Americans.

We’ve written before about Skybus, a low-cost, low-fare start-up airline based in Columbus. Skybus ceased operations last Friday evening.

A number of investors voluntarily risked much on the Skybus and lost their bet.

A lot of local and state taxpayers and Port Columbus service users similarly risked much, but the difference lies in our motivation. We were compelled to bet on the Skybus business plan and general economic conditions through taxes and fees that we had no choice but to pay.

Remember, our bets were placed by politicians spending someone else’s money. This would be politicians seeking not the best possible balance between risk and reward (and how can they possibly know the aggregate of all our individual preferences in this regard), but politicians seeking what rewards them, namely photo-ops and contributions and other perks of power.