And speaking of people who will be speaking at this week’s sports economics conference and the Casino Night Fallacy, J.C. Bradbury had an op-ed in the Arizona Mirror yesterday on the proposed Arizona Diamondbacks tax-redirection bill, and didn’t mince words, as he never does:
The funding mechanism being proposed to benefit the Diamondbacks relies upon what public finance economists call “fiscal illusion.” The tax mechanism was selected to understate the public cost. By drawing funds from the district around the stadium, it gives the appearance of a use tax, being paid for only by customers.
This is not correct. What it is doing is taking tax dollars that are scheduled to be allocated to other public purposes and instead redirecting them to underwrite this special-interest project. Even though the hundreds-of-millions of dollars figures being discussed would be collected from the geographic area, the revenue has the opportunity cost of funding other public projects or simply cutting taxes to put the money back in taxpayers’ pockets.
If the government is devoting public dollars to a stadium project, then the public must be out that same amount of money. You cannot pull this money out of thin air; otherwise, we would fund all public projects like this. It’s important to remember: THERE IS NO SUCH THING AS A FREE STADIUM.
Siphoning off $500 million worth of future tax revenues and delivering them to the Diamondbacks’ billionaire owner, concludes Bradbury, “is a wealth transfer from general taxpayers, many of whom can’t afford to go to a game, to the most well-to-do members of the community. Democrats and Republicans should be joining hands in opposition to this indefensible subsidy rather than making bipartisan toasts over cocktails in the owner’s suite.”
The D-Backs stadium subsidy bill was set to hit the Arizona senate appropriations committee today, but was removed from the agenda at the last minute. We’ll have to see whether this was because it didn’t have the votes to pass, and if so what the bill’s proponents do next; we should find out soon enough what state legislators plan on doing with their hands.
If the Arizona politicians were smart, they’d tell the D-Backs ownership to pound sand. Anyone with a brain that looks at the ballpark floundering of the A’s and Rays (and Royals, for that matter) can see that no one in another place is going to give the D-Backs owners a free ballpark.
Of course “if the Arizona politicians were smart…” is kind of like “if pigs had wings, they would fly”.