Even though you may not have realized it. And I’m talking about stadiums, not small businesses. There’s a form of corporate welfare going on everywhere in the country that’s discussed from time to time, but seldom resolved: sports franchise owners regularly and unashamedly avail themselves of tax benefits and other financial perks in order to build privately-owned stadia across the country. And while this has been going on for years now, the total cost to you, the taxpayer, is $4 billion.
Using tax free debt issuances to finance venue construction began long, long ago using tax laws that were originally intended to help cities and municipalities fund the new roads, sewers and other vital infrastructure projects. But, as it turns out, the way that the laws were written didn’t prevent anyone from using them to help out wealthy sports team owners who threatened to pull up their roots and move elsewhere.
So what to make of it? Having major league sports teams do indeed bring jobs, though they’re not great jobs. It brings favorable media coverage to a city. And it also serves as a draw to the city itself, usually bringing other people into the cities in which the subsidized stadiums are constructed. The price tag of $4 billion, in the grand scheme of things, really isn’t a whole hell of a lot. So while in financial terms, it isn’t that big of a deal, and probably only represents a modest loss on the total initial investment, why do I even bring it up?
I do so because the entire undertaking is an abuse of a law that was intended to do other things, and it’s being done on the behalf of already staggeringly wealthy individuals who can afford to finance these projects on their own. The benefits, if there are any, are modest, at best, if not a minor loss for the taxpayer. All of us are helping to fund vanity projects that could otherwise be finance, which puts more money in the pockets of those that already have a ton. And if we were to take seriously the situations of Americans who truly need it, this money would be far better spent on a plethora of other projects.
But my main gripe is that we’re giving special tax treatment to those that don’t need it. If you’re a major league sports team owner, you’re doing just fine. We’ve made a tacit bargain with these guys, and it’s played out, again and again, in our tax code from agribusiness to oil to finance. We have written so many loopholes in our tax codes that give out advantageous tax deals to those that don’t need, and publicly financed stadiums are probably only the most visible of these taxpayer subsidies.
Our budget is a disaster. And while there’s going to be plenty of pain to share in the coming years when we do eventually bring our costs in line with revenues, I would argue that preferential tax treatments for those that don’t need it to begin with is a very easy way to start balancing our books.