Two weeks ago I wrote about a future discussion in the Legislature between those who believe Oklahoma can improve economically by reducing the size of government and lowering taxes, and those who feel that Oklahoma should continue to develop a wide array of giveaways in the name of economic development.
As State Representative, I have observed that whenever a new problem crops up, it takes very little time for people to look to government to provide a solution. All too often they fail to account for the fact that if government expands to provide the solution, it will make politicians more powerful, and better enable those who wish to use this power for inappropriate or counterproductive purposes.
In the case of economic development, those who advocate for giveaways to incentivize business will point to the problem of economic blight and ask for the government to take away our taxpayers dollars, give that money to politicians or bureaucrats to control, and then give them the power to determine who receives the benefit.
A prominent example of this type of abuse has been alleged in the state of Illinois. Illinois Governor Rod Blagojevich is accused of trying to strong-arm the Chicago Tribune into firing critical editorial writers by leveraging his power to help give the Tribune millions of dollars.
Formed in 2003 by Governor Blagojevich, the Illinois Finance Authority is probably similar to any number of Oklahoma boards and commissions. Basically, the Illinois Finance Authority can act on behalf of the government, but it functions much like a private enterprise. Their goal appears to have been to issue taxable and tax-exempt bonds, make loans and invest capital to help local government, businesses, education, health care, not-for-profit organizations, agri-industry, etc. via market-specific financial services.
The Chicago Tribune owned an asset that it needed to sell: Wrigley Field in Chicago. The governor is accused of advocating for the Illinois Finance Authority to take control of the stadium's title so the Tribune would not have to pay capital gains tax on the sale. This would potentially save the company about $100 million. Because of these savings, there would be more incentive for the Tribune to sell the stadium to the government instead of a private enterprise.
On the surface, the Finance Authority appeared to be able to meet any number of needs that its supporters felt should be met by the government acting in this capacity. In reality, however, it appears the Finance Authority was the governor's tool to wield an enormous amount of inappropriate influence over the people.
I feel the people are much better served by a smaller government which enacts low taxes that are fair to everyone. Keeping taxes high allows the politicians to create these complicated entities that can do much more harm than good. In this case, it appears that the Finance Authority may not only have enabled an allegedly corrupt politician, but may also have warped the free market process. It appears to have promoted an environment in which corruption could flourish. How many other examples of this type of abuse are occurring across the nation but are simply not being exposed?
This reaffirms my opposition to efforts in Oklahoma to extend power and money to these types of organizations in the name of economic development.