RALEIGH – There’s been a lot of bad news lately for taxpayers, so it comes as a welcome sign that the House rebuffed a bill today (see here: http://www.herald-sun.com/state/6-271040.html) that would offer generous tax breaks for tourism-related developments around the state. The legislation is not completely dead, but with the end of the 2002 session not far off its chances of passage are fading fast.
How can the defeat of a tax-reduction bill be good news for taxpayers? The primary reason is that if lawmakers keep junking up the tax code with corporate welfare items disguised as tax cuts (this bill is essentially a gift to the coming NBA franchise in Charlotte plus some other special interests associated with sports stadiums and convention centers) it will become increasingly impossible to reform the tax code and reduce the tax burden for everyone.
Government officials, no matter how wise and well-informed (feel free to insert your favorite joke here), simply do not have the information required to guess what businesses or industries will succeed or fail. Economic development doesn’t consist of making such guesses and then backing them up with taxpayer money – or the provision of government services to new enterprises without collecting the requisite taxes from such enterprises, which is essentially the same thing. Economic development should mean the development of our economic base through proper state functions such as maintaining a system of courts and building roads.
It’s time for lawmakers across the political and ideological spectrum to show some leadership here. They know that these incentive policies are wrong. Too many of them, however, think that they have no choice but to follow the crowd on this and do whatever everyone else is doing.
Trust your instincts on this one, ladies and gentlemen. If a piece of legislation pops up at the end of a session and it makes little sense, confuses even its sponsors, and makes you distinctly uncomfortable, then it is very likely a BAD IDEA. Try a little leadership – you may come to like it.