There’s a popular refrain in Missouri Republican circles right now, that of “we shouldn’t be picking winners and losers by giving tax credits to businesses.” And as a conservative, tea-party attending, independent-minded Missourian, I must wholeheartedly DISAGREE!
Yes, I completely disagree with the many people who are using this line. Many of whom I know personally, have voted for and will most likely vote for again, because they are right on so many other issues.
But on this one, I respectfully must disagree.
A good example of this is the recent debate over a China hub in St. Louis. Many Republican’s in Jefferson City were opposed to this and their argument was that we should not choose which companies will win in our state and we shouldn’t send money to China.
But, in sticking with a nice sound bite, they have missed the point. The China hub would create jobs in St. Louis, it would spur economic development and entrepreneurial startups, and it would cost way less in tax credits than it would generate in tax revenue. Simply put, the companies wouldn’t get a cent unless they grew the economy and generated more revenue than the credits would give them.
And yes, we would be making some money for companies in China, while we are making money for companies and employees here. This means incentive for Chinese investment and incentive for US investment–with benefits for both. If you can get an economic win-win, I think you should go for it.
I may be simple minded here, but when a tax policy attracts foreign investment that benefits our area way more than it costs us, it seems like a no-brainer.
Plus, if a state has underutilized strengths, such as an underutilized airport, with great river, road and rail transportation, then a state government should do whatever it can to ensure that in the competition for foreign direct investment we win out over the other 50 states who are also looking for that growth. Our state should be all about making sure the strong industries in our state win, and therefore generate economic growth all of us will benefit from.
I’ve also seen this “don’t pick winners and losers” applied to federal contracts. Once again, in the federal government buying something from a manufacturer they are actually picking winners and losers. That’s all they can do.
If they award a contract to Boeing, and not one to Lockheed-Martin, then the federal government has chosen a winner and a loser. And as a conservative, limited-government type, I’m quite OK with that. And as a resident of St. Louis, and someone who has fought to stay conscious in the backseat of an F/A-18, I’d prefer they choose Boeing every time.
So please friends, let’s get beyond the sound bite that seems to give conservatives what they ask for, while really not solving anything. Let’s actually apply sound, fiscally-conservative economic principles to our decisions in Jefferson City.
In the end, we’ll all win if we do.