The Futility of Economic Development Efforts
Yesterday Rob did a story on Fargo and Cass county’s idea that a NEW sales tax should be imposed on the public in order to pay for economic development. That got me to thinking what exactly is the justification for these programs.
Let’s not talk about the morality of forcing someone to pay a tax and giving it to another person who didn’t earn it. Let’s also leave the discussion of why so many of these programs fail. Let’s talk about the reason why the proponents say they’re worried.
It seems that these folks try to sell these things with the idea that if the community grows than everyone will be better off. If there’s more people paying the tab then everyone’s tax bills should go down, right?
But if history shows us anything that after the people sink tons of money into economic development their taxes just never seem to go down. Fargo has been very successful, or so I hear, with their economic development efforts. But if that’s the case then why do they want a new tax? If they haven’t been successful then why would you throw more good money after bad.
Another example is my home town of Grand Forks. The Industrial Park is nearly filled up. City council member Doug Christianson said that they need to raise taxes to pay to buy more land. But when did taxes ever go down because of the businesses moving into the Industrial Park. If it’s going to cost us more and more money for economic development then why do it?
In today’s Grand Forks Herald the subject was the competition between Grand Forks and East Grand Forks about who could subsidize new home builders to build in town. Isn’t that something just crazy to be fighting about. I mean if we get a new good neighbor who cares if they live across the river.
For the average Joe, this economic development stuff just doesn’t make sense. So why is there so much pressure to do it. I think a lot if not most of it is the egos of the various city leaders. For some reason they aren’t satisfied in just running a good city. They feel they have to meddle in areas beyond their expertise. Then if the city grows they can take credit for it. (I don’t remember them taking the blame when these same companies leave for the next better deal.) I think they also look to the towns that do play this game with a bit of ec-dev envy. If another town is growing they think we’re doing something wrong. I disagree that we have to be the biggest, I think we should work on being the best.
And the city employees are all gung ho for more people, more tax revenue, more pay and more workers so they have less work. Why wouldn’t they be? The thing is do we run the city for the people that work for the city? Do we run it to stoke the egos of the elected officials? No we should be running the cities for the benefit of the people that work there. And you know what, if you do the job right then there won’t be a problem with growth because it will come.












