City doesn't need jobs ‘slush fund'

I agree with Jerry Biggs' recent column, "JOBS referendum would give city means to promote job growth," on one point: "Colorado Springs is at a crossroads." Where we differ is on which path the city should take to achieve long-term economic health.

He and other supporters of measure 1A want to take shortcuts, by putting roughly $50 million in taxpayer money into a honey pot (one member of City Council called it a "slush fund") and handing it out to supposedly needy companies at the discretion of City Hall. City officials want to play venture capitalist, using other people's money, by making the rest of us partners in "investments" they probably wouldn't make with their own money.

1A is an invitation to mischief, and to the misuse of tax dollars, which will leave the city vulnerable to endless shakedowns by companies promising to create jobs in exchange for cash, or threatening to take jobs away if we don't pay up. And the fact that it's on the ballot, at a time when the city is slashing services and average folks are pinching pennies, shows that our political and business leaders don't have their priorities straight.

We all want a thriving local economy. But before we start handing out cash to companies as a means of influencing business decisions - which is wrong on principle and questionable in practice - let's ask ourselves hard questions. Have Colorado Springs and El Paso County done everything in their power to create an optimal business climate by reducing barriers to entry, streamlining the regulatory and permitting process, overhauling antiquated codes and zoning laws, addressing infrastructure challenges and educating the workforce of tomorrow? Do we consistently work as a community to serve as an incubator for entrepreneurship, and strive to make Colorado Springs nationally known as a great place to do business? Is our tax and regulatory climate calibrated to attract and grow businesses? Are area schools uniformly excellent?

Until we can answer "yes" to these questions, the subject of paying cash incentives shouldn't even be debated, because we haven't done the things we must do to ensure the long-term health and competitiveness of the local economy.

There are many pitfalls to playing "the incentives game." Once a honey pot becomes available, the demands for more money are bound to grow. The jury is still out on whether incentives "create" new jobs, or just move them around the map, depending on who pays more.

Companies that demand "incentives" have no loyalty, and are here only until the next high bidder comes along.

Cities quickly reach a point of diminishing returns, where they're paying out more in incentives than they're taking in in related revenue. The practice is unfair to the 99 percent of businesses that don't ask for handouts and special favors.

Any time politics and business mix, there's the potential for ethical lapses, bed-feathering, conflicts of interest and outright corruption. Could that happen here? Who can say? But the surest way to avoid such situations is to turn our backs on the temptations.

Biggs and other backers of 1A congratulate City Council on its "vision" and "leadership" for putting this on the ballot, but trying to hitch the city to the corporate welfare bandwagon actually shows a bankruptcy of both. Our political and business leaders evidently aren't willing to do the hard work required to improve the city's overall business climate - like doing away with the city's business personal property tax, for starters - so they want to cut corners instead. They offer vague promises that a "dedicated" fund for economic development will boost a local economy held down by factors beyond the control of a few deal-makers. But this contradicts common sense and experience.

"Creating jobs" isn't the responsibility of government; nor is it government's forte.

Government "job creation" can only occur by taking money from some people, and some businesses, and handing it out to other people and businesses, at the politician's discretion. Government and business need not be adversaries; but they shouldn't be in bed together, either. Aren't events in Washington proof enough of the dangers that arise?

And those dangers exist at the local level, too.

Instead of looking for ways to expand government's role in economic development, let's recognize government's role in hindering job creation and redouble our efforts to clear away the barriers it erects to opportunity and prosperity. That's a far more fruitful place to "invest" our effort than the lazy-city's shortcuts offered by 1A.

There are no shortcuts to long-term economic vitality. Vote "no" on 1A.

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Paige is executive director of Local Liberty Action and the editor of LocalLibertyOnline.org, where a more complete critique of 1A can be found. Write to him at SeanPaige@msn.com.