…..Semper Fi
Posted on 10/30/2003 10:35:48 AM PST by North Coast Conservative
VOTE “NO” ON ISSUE 1
Ohioans have the opportunity to vote against the expansion of Governor Taft’s transforming economic development plan, Issue 1, also known as the Third Frontier.
A frontier, according to Webster, is a new field for exploitive or developmental activity. The first frontier was taming the wilderness, the second, the industrial frontier according to some, or the exploration of outer space according to others.
For central planners to put the transformation of our economy on par with those frontiers is fair warning that Issue 1 is a big deal.
Proponents say it will create jobs (as though that was a legitimate function of government), but research indicates otherwise. A study of 366 Ohio companies that launched major expansions between 1993 and 1995 reveals that economic development incentives have very little (or even a negative) effect on actual job growth. Findings suggest that companies that receive tax incentives overestimate the potential of new jobs more than those companies that do not get incentives (Journal of Regional Science, Issue 4, 2002).
Issue 1 is definitely an incentive – an incentive for the chosen few but at the expense of the many. It calls for passage of a 10-year, $500 million bond issue backed by the full faith and credit of the state – meaning our tax dollars. Issue 1 is an end-run around Ohio’s constitutional 5% cap on debt service. That cap limits state borrowing. Current exceptions to the cap include justifiable spending for critical needs, such as to repel invasion, suppress insurrection, or defend the state during war.
The precise amount of the Issue 1 related debt is unknown, but taxpayers already spend $1B on state-generated debt service each year. If Issue 1 passes, that figure will jump even higher. If the interest rate is 4%, interest payments will total $225M, for a total cost of $725M - money that will be due after the so-called temporary sales tax expires. Policy Matters in Ohio reports that “substantial increases in debt will be difficult to sustain if the recent increase in the sales tax is allowed to expire as planned, and no alternative revenues are found.” Accordingly, to imply that taxes won’t be raised is disingenuous. It’s also important to remember that because payment of debt service takes precedence over spending for discretionary programs, many deserving programs are apt to get displaced.
Ohio’s Third Frontier is a multi-phase plan to link businesses with universities. One of the stated goals is to pay operating expenses such as salaries and expenses for research activities, secretarial support, conferences, meetings, and related travel.
It is fully expected that universities, researchers, professors, and businesses which have had their work underwritten by taxpayers will “commercialize” their products. That means they will make a profit when their subsidized products hit the market, giving them an unfair competitive advantage in the marketplace. The Third Frontier is a slick plan to funnel corporate welfare to the chosen few. The obvious question is: How will non-subsidized companies be able to compete?
Proponents budgeted $3M to persuade voters to support Issue 1. Where is the “get-out-the-vote” money coming from? Well, there is no prohibition on donations to the campaign from corporations that may later receive Third Frontier money, so it is conceivable that wanna-be recipients of tax credits and grants are ponying up the money.
Our economy is based on a free-market system. Economic decisions are supposed to be made by producers and consumers, not the government. Any transforming move away from capitalism is, by default, a move toward some other ism – for example, socialism, a planned economy where economic decisions are made by those affiliated with the government; in the case of Issue 1, three governor appointees.
Passage will abolish a 156-year-old ban against government being a stockholder in private businesses. Yes, the state already gives grants to businesses (a topic for another day), but those grants are not for operating expenses. In addition, the money comes from existing revenue and it is generally limited to capital improvements.
Be forewarned, Issue 1 is a vehicle to lift the cap on excessive state borrowing, promote unfair competition, transform our economic system, and lift the ban on government being a stockholder in private businesses.
Certainly there is no merit in saddling ourselves or our children with debt for the next 29 years (when the last payment comes due) especially when there will be nothing concrete to show for it. I encourage you to join me in voting “No” on Issue 1.
------------ Diana Fessler represents Miami County and a portion of Darke County. E-mail: diana.fessler@ohr.state.oh.us
…..Semper Fi
Everybody is going to the polls on Tuesday, right?
In God We Trust…..Semper Fi
Yes sir, I am. Anything that is for "economic development" is a definite NO vote for me.
Yeah, it’s the old bate and switch routine. Except you usually get this type of con job from the dims.
The precise amount of the Issue 1 related debt is unknown, but taxpayers already spend $1B on state-generated debt service each year. If Issue 1 passes, that figure will jump even higher. If the interest rate is 4%, interest payments will total $225M, for a total cost of $725M - money that will be due after the so-called temporary sales tax expires.
It will take an a lot of new high paying jobs to generate enough money to pay off that kind of debt.
Why is it that politician love to spend other people’s money so much that they so easily are willing to sell their honor for the pleasure?
Is it some kind of addiction?
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