A Bolt of Sanity from the Eco-Devo Blue

March 26, 2020

IN THE MIDST OF CRISIS, with pretense stripped away, the truth can strike like a lightening bolt.

That was the case at a recent meeting of my City Council. When the governor shut down restaurants and bars in advance of the Wuhan flu it was made clear that what we had been told was economic development had precious little to do with developing anything — rather, that it was about who could crony what capital and how much.

First some background: The rationale behind the local food and beverage tax was that the money would be used in ways (enhancing entertainment venues, building sports stadiums, shopping attractions and such) that on the drawing board at least would increase business for those working in food and beverage. It was one of those win-wins that politicians love to pull out of their hat.

So the tax was gathered into a special fund to be used as seed money for the grand restoration of an old manufacturing plant near the so-called economic-development corridor.

The Capital improvement Board committed $45 million to the never-got-off-the-ground project, some of that to have been bonded but a good hunk of it from the food and beverage tax. The total local commitment was a whopping $65 Million, including $10 million from a municipal legacy fund and the remainder from county and city economic development budgets.

Boom. Now comes the lighting bolt. A former councilman, Mitch Harper, broached an idea in casual conversation — hold on to your seat — of returning the money to the restaurants and bars that now need it to stay alive. Yes, returning tax money, their own money that had been unwisely entrusted to the care of local government.

Harper’s successor, Jason Arp, introduced the novel concept to the Council this week. Here is his thinking:

“Last night, in the council members comments segment of our meeting, I put forward the idea of a council resolution that would ask the administration to work with the Capital Improvement Board to take the unallocated balance in the Food and Beverage Tax fund, a fund that had been reserved for the ill-fated Electric Works project, and return it to the restaurants and bars that paid it into the government coffers. At this time of extraordinary hardship for dining and entertainment venues, it seems that we, their local government, could return to them the money that they could sorely use to weather this storm.”

Thud. The local newspaper squelched the idea for 24 hours, finally tucking it in a political gossip column. The electronic media never picked it up, so the idea in effect is a public policy secret.

Nonetheless, Arp plans to formally propose the measure after the Easter recess. It will fail miserably. By then, the other councilmen will have been briefed on how the world works by the gang of lawyers, bankers, architects, engineers and other rent-seeking political donors with their fortunes linked to the $65 million.

These are men and women, please know, who will work devilishly hard to funnel those millions in their own direction, whatever project they must use as justification. The restaurateurs and bar owners, however, even with justice and logic on their side, will have been too busy keeping their businesses afloat to write so much as a letter to the editor.

It is a reminder of an economic principle: The few who have great sums to gain by rerouting public money will be more politically effective than the many from whom only small amounts are rerouted. Once the multi-million-dollar fund was created, and its specific use and management obscured in the eco-devo labyrinth of appointed commissions and extraordinary fiscal arrangements, the outcome was certain: It would be squandered on high-cost schemes related to the general good only in the imagination of the promoters.

We will never know how many actual, existing restaurants and bars would have been saved by Harper’s idea — saved, of course, with their own money. Nor will we know how many would have gone on to prosper, adding branches and employees in true and natural economic development.

But again, that isn’t the point. It hasn’t been the point for some time. — tcl



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