By Paul Henry:
How does our economy operate? It depends upon whom you ask. Some believe that opening a business is a matter of having an idea for a good or service, obtaining private financing if needed, and putting that idea to work. Others think the above is not possible without help from the government- especially if you are an already established business. Last night, I spoke at my local county commission’s budget workshop. Out of four “economic development” quasi-government groups, three out of the four received a funding increase. Only one commissioner newly-elected in 2012 opposed this idea- and that fortunately is one more than has done so in the past. This is not the typical Democrat vs Republican issue, as the majority of my commissioners are Democrats and a friend in another nearby county sees the same thing with a majority of Republicans. As you’ll learn, tax dollar giveaways began under a Democrat Governor and were greatly enhanced under two Republicans.
Most people have seen the boondoggles at the federal level such as Solyndra, which cost taxpayers $535 million. Likewise, most people are aware of the federal bank bailouts. Did you know the same thing is happening in Florida for banks as well as other large corporations? The state’s Department of Economic Opportunity (DEO) has an “economic development” portal where you can track state spending. I put together several spreadsheets based upon this info- one for completed projects, and two for active projects. These numbers are for where tax money has actually been spent.
For the completed list, there were 106 completed entries (click for spreadsheet) totaling $49,881,209.61. Entries include:
- $7.8 million for Fidelity National Financial
- $4.2 million for Lockheed Martin
- $3.0 million for Wal-Mart
Grocer Publix was rather frugal, taking “only” $364,375.
For the active list, there are 193 active entries (click for spreadsheet) where over $1 has been spent totaling $567,748,755.31. Entries include:
- $137 million for the Sanford Burnham Medical Research Institute
- $94 million for the Max Planck Florida Corporation (this is a neuroscience institute)
- $60 million to VGTI Florida, a vaccine research firm with 50-99 employees.
- $7.4 million for Fidelity Nationl Financial- a repeat customer from above
- $4.9 million for Lockheed Martin (remember them from the $4.2 million above?)
- $4.0 million to the Navy Federal Credit Union
- $3.6 million to the German Deutsche bank
- $3.0 million to Fidelity Global Brokerage- which places Fidelity over $18 million in total.
There are in fact 490 active entries (click for spreadsheet), the 297 others are awaiting funding approval. They include $5.4 million for Bank of America.
The totals for just the mentioned banks or financial institutions is $31 million. Remember when we used to go to the bank to get money? The situation is now reversed.
Math is difficult- analysis such as this takes time and effort. Can you help us to continue this work by making a monthly donation? We are one of the few organizations working against this corporate welfare in Florida.
What does the law say about this? Again, it depends upon where you look. In Florida’s Constitution, under Article 7 Section 10, it prohibits nearly all use of tax money for the private sector. Yet under Florida Statute 125.045, this practice has been authorized since 1995 when Democrat Lawton Chiles was Governor- it was greatly expanded in 2010 under former Republican Governor Crist and expanded yet again under current Republican Governor Rick Scott. Since there is no supremacy clause in Florida’s Constitution, there exists a conflict that would have to be resolved by a court. Since most Floridians don’t have an extra $50,000 laying around, it’s difficult to file such a suit.
When politicians are questioned on this topic, a common response (albeit rather childish) is that everyone else is doing it. What happens when governments compete for business using our tax dollars? I read an interesting analysis of this situation here from November 2013. The writer correctly found that it turns into a bidding war, and ironically calls for more government (federal laws) to stop it. The point is, it’s easy to spend other people’s money, and as the author noted in his opening line “Tax incentives and other giveaways to business don’t create prosperity.”