Thursday, November 29, 2012

Crazy Idea??

From yesterdays Crain's New York Business: Liu calls for ending tax subsidies for business

New York City Comptroller John Liu proposed a self-described "crazy idea" on Wednesday: get rid of all taxpayer-funded subsidies for private businesses and lower taxes for all businesses across-the-board. "That way we don't create unlevel playing fields even within our own city, where completely unsubsidized businesses have to continuously compete with their neighbors, some of them down the street, some of them a couple miles away, that are getting significant subsidies from taxpayers," Mr. Liu said. "Let's level the playing field for everybody."
The article identifies Mr. Liu as one of the Democratic contenders for Mayor.  And THAT's really the ONLY thing that seems crazy about this idea:  that it comes from a New York City Democrat!  

Other contenders quickly dismissed this idea, and the City administration jumped in to claim how its use of taxpayers dollars "leveraged" billions in private investments to create "tens of thousands" of jobs, and that "independent watchdog" groups held its IDA up as a "model" of "transparency" and "robust efforts to protect taxpayer dollars."  (The buzzwords and rhetoric from the economic development types gets tiring).

It's funny how the others totally missed or intentionally ignored the "create unlevel playing fields" argument.   But that's not unexpected because eliminating crony capitalism would eliminate the source of political power for many of these people.

Mr. Liu's position sharply contrasts with that of Governor Cuomo who toured the area yesterday Per the Governor (via WIBX)
“I want to make sure that we’re using taxpayer money wisely and we’re investing in the best plans that have a high likelihood of success,” Cuomo said. “This is about creating jobs, and I support taxpayer investment to create jobs. But, I want to make sure that we’re actually creating the jobs. That’s what the competition helps us do.”
Right! The "competition" between New York's regions can do no such thing because it is phony -- set up by Mr. Cuomo himself, rather than the marketplace.

Mr. Liu is on the right track.

The question for us Upstaters:  Can we get Mr. Liu to set his sights a hundred miles north of Gracie Mansion?   

11 comments:

Anonymous said...

Cuomo........what a phony do nothing ,talk alot windbag.I noticed that neither he or any of our local pols took him through west utica ,cornhill or they rest of our blighted areas. How about a visit to the county office building to see the faces of the "clients" endlessly passing through. Talk is cheap and Cuomo is the master of talk.

Anonymous said...

Good timing for the post. Cuomo was in promoting all of his business investments. The history of the state's business investments which it has been using taxpayer money for as long as I can recall which is decades, is marked by business, job and population loss. That proves beyond a doubt that Cuomo is wrong when he states that the state can create jobs. I'd love to know the billions of our money his father, Pataki and all the rest spent on creating jobs while the state declined. It's all plitics being played with our money. Cut government and cut taxes. Then you'll see private job creation.

Strikeslip said...

Interesting reading about Mr. Liu. There may be a skeleton or two rattling around in his closet per Wikipedia. Does not change the common sense of his point, however.

Anonymous said...

Keep in mind that Liu is not the choice of the NYC political establishment and is considering running for Mayor. That means they will sully him and his reputation with anything they can find to discredit him.

That's why I always judge politicians based on their record and platform, not the personal stuff. They're people, too. Unfortunately, society has made us believe that politicians are super human and supposed to be almost God like in their personal life. Even our founding fathers were FAR from perfect men.

With that said, unless there's something much more serious about Liu that I don't know, he is exactly the kind of NEW DEMOCRAT that we need. But that's also why his chances are likely a long shot. How dare someone think outside the box and challenge the status quo. Surely they must be mentally unstable to do so. (insert sarcasm)

Jr.

Anonymous said...

Have we not noticed that certain voting groups tear down the messanger at first opportunity and never address the message? That is precisely why our nation and State are in the condition they are in.

Dave said...

I'd be careful about getting the government totally out of the business of stimulating business. It can be a useful tool that benefits many people, IF DONE WELL. I'll admit it does not appear to be anything more than "friends and family" sometimes, or pandering for votes from groups like labor, etc. In fact, New York State may have perfected that art. NY invented backdoor borrowing, so the state is perfectly capable of finding ways around the law to dole out taxpayer dollars to favorite parties. But small businesses can benefit from special considerations when they have to compete with multi-national corporations with stables of specialists and lawyers. Such ideas as business incubators, small business loans and tax incentives can help a small business to grow, hire more employees and get a chance to survive in the shark tank of Korporate America.

Anonymous said...

The problem with the government business loan, grant and tax programs is that they have evolved from beingh secondary sources of investment to primary sources. They also expanded to include retail ventures which are secondary employers. And, as the government role has grown larger, the political/crony capitalism feature has started to dominate. Sorry, Dave, but a true accounting of the government subsidy business results in the inescapble conclussion that it cannot "be doen well,"

Dave said...

Anon., you could be right. I wish I could find some hard data on the net results of government involvement. All I can find in a quick Google search are one set of articles for it and an equal number against.

As we know it, government subsidization is probably a loser.
How we could fashion it so the net was positive I don't know.

But I'm still not convinced a total ban on government involvement is a good thing. I'm sitting here on a PC connected to the Internet that might not exist if the feds hadn't underwritten large-scale-integrated circuits, ostensibly to "conquer" space, by creating a market for the R&D.

Frank Elias said...

Here is a link to a NYT Series being run this week.

Tells about governmnet subsidies of business throughout the US

http://www.nytimes.com/interactive/2012/12/01/us/government-incentives.html?hp

Frank Elias said...

The NYT is running a series on Government subsidies for business. Here is the first article in the series.

http://www.nytimes.com/2012/12/02/us/how-local-taxpayers-bankroll-corporations.html?hp

Strikeslip said...

Thanks, Frank. BTW You & Mark are doing a great job developing a lot of our local issues. Keep up the good work!