IPFS Dave Hodges

More About: Politics: General Activism

The Private Theft of Public Money

When you were a child peddling five and 10 cent drinks at your makeshift lemonade stand, did you ever consider asking the government for a publicly funded “incentive” to assist your business in its start up costs?

For those of us who have caught the entrepreneurial spirit, would we have ever considered asking our local city government for a series of publicly assisted benefits such as paying no property taxes for 10 years? Did you ever think to ask for and receive a sales tax exemption for the next 5 years? And if any of us “common folk” would have dared asked for these start-up business incentives, we would have been laughed out of the corridors of our local city hall. Why? Because the privilege of receiving corporate welfare is reserved for the big boys, such as the big box stores, in this increasing city government culture of one hand washing the other. Certainly, we all realize that nothing is really free as grateful corporations become eager campaign contributors in local elections. In the furtherance of supporting your local box stores, your local mayor is in effect actually raising the tax base of their respective communities without so much as a public vote, or a public debate taking place. What the city officials don’t tell you is that for part of our work day, the common man is laboring to support a global corporation’s entry into their community.   

Increasingly, Arizona ’s cities are luring businesses to their respective communities with the promises of incentive deals between the cities and high dollar retailers. Two years ago, the Arizona State House of Representatives attempted to curtail this private theft of public money. Unfortunately, for the state’s taxpayers, the measure was killed in committee by Representative John Nelson (R-District 12). Representative Nelson was quoted in the Arizona Republic as saying that “Such a measure is really unnecessary as I believe that the cities have finally learned their lesson.”  Well, apparently not, Mr. Nelson! Corporate welfare is rampant in our communities and is increasing each year.

I have to compliment the global corporations for their business ingenuity. First, they lobby the United States Congress into entering into free trade agreements (e.g., NAFTA, CAFTA) which allows them to unemploy millions of American workers in the name of relocating their manufacturing overseas and then these same corporate interests are allowed to sell these foreign made products back to the many of the same displaced Americans, through the removal of tariffs. Then, these same corporations convince Congress to passively ignore the illegal immigration problem in the name of acquiring even more cheap labor. Adding insult to injury, these same corporate interests are experiencing dramatic economic benefits through this new system of tax-supported corporate welfare. At least when the state and federal government raise taxes, it requires a public debate and vote. All too often, these political decisions which serve to benefit corporate interests at the expense of the taxpayer are executed by unelected bureaucrats such as the Town of Surprise ’s Economic Development Director, John Hagen who claims that this form of corporate welfare is needed. Hagen is quoted in the April 6th edition of the Surprise Republic , Section 5-Page 1, as stating “It is going to make it tougher for us to build some of our commercial developments here and support our population.” What? Mr. Hagen do you really expect us to believe that a city, whose population has raced passed the 100,000 mark, will not attract businesses who want to take advantage of the greatly increasing customer base? Who is Mr. Hagen kidding? In the unlikely event that Hagen ’s questionable warning would culminate in a wave of businesses forsaking Surprise as a retail outlet, at least the taxpayers of Hagen ’s community would get to make the conscious choice to spend the money to drive to an empty-headed community, gullible enough to grant incentives, in order to shop in the corporate welfare stores.

Fortunately, for Arizonans, two legislators, Representative, Ken Cheuvront (D- Phoenix ) and state Senator, Jack Harper (R-Surprise), are helping to lead the charge to put an end to this public theft of private money. SB 1350 and HB 2515 would allow the state to withhold a portion of the city-state revenue sharing in the exact dollar amount a city may award as an incentive to a private retailer. In the same Surprise Republic article, Jack Harper stated that commercial areas will infill on their own, and Surprise has a booming population.”  The common sense of Senator Harper’s statement should be apparent to every taxpayer. However, Harper’s statement is equally reprehensible to bureaucrats, such as John Hagen, who cannot seem to shake their modus operandi paradigm of supporting the corporate welfare state. Both the House and Senate version of this bill is currently in committee.

The cities lobbyists are scurrying around the buildings of the State House and the State Senate seeking to kill the two bills. Yes, fellow taxpayers, you are also funding the cities efforts to fight the reigning in of their corporate giveaways of our money. In fact, according to the Daily Reckoning, America ’s cities pay more for lobbying than do the oil companies! Isn’t it time to put an end to this excessive waste of our precious resources?

In this tax season, financial experts remind the public that it is not too late to purchase an IRA in order to lessen our tax load. I have a simpler solution if you really want to cut your personal tax burden: Do yourself and every Arizona taxpayer a favor during this tax season, pick up the phone and call your local legislators and request that they support HB 2515 and SB 1350.  In the meantime, I wonder if Mr. Hagen would mind getting Surprise to fund the canopy for my six year old son’s lemonade stand.


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Dave Hodges
State Party Chair
Constitution Party of Arizona


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