Call it a coincidence or a sign from above, but on the same evening the Minnesota I-35W bridge collapsed, elected officials were gathering with the Minnesota Twins to dedicate construction of a new ballpark with $392 million of taxA tax is a mandatory payment or charge collected by local, state, and national governments from individuals or businesses to cover the costs of general government services, goods, and activities. payer money.
The Twins canceled the dedication, but there have unfortunately been no calls to halt construction of the new stadium and spend that money—extracted from Hennepin County residents with a sales taxA sales tax is levied on retail sales of goods and services and, ideally, should apply to all final consumption with few exemptions. Many governments exempt goods like groceries; base broadening, such as including groceries, could keep rates lower. A sales tax should exempt business-to-business transactions which, when taxed, cause tax pyramiding. hike—to repair the bridge. Instead, all we hear are calls from pro-tax pundits for more tax hikes or “emergency spending” by Congress.
New York Senator Charles Schumer analyzed the situation best: “The bottom line is that routine but important things like maintenance always get shortchanged because it’s nice for somebody to cut a ribbon on a new structure.”
Was it just a fluke that Twins billionaire owner Carl Pohlad, (ranked 107th richest person in America by Forbes) was able to extract almost $400 million from the taxpayers?
Unfortunately, it’s no fluke. This corruption of proper public finance is rampant at all levels of government. Politically left and right agree, Ralph Nader and Milton Friedman agree: corporate welfare is wrong, and stadium giveaways are the most egregious example. Benefits flow to millionaire athletes, billionaire owners, and high-income customers. The losers are residents who don’t like sports, taxpayers and the local economy as a whole.
And it’s not just baseball. Minnesota’s public officials have “touched ’em all”:
1995:
• Minneapolis forgives $74 million loan it made to the Timberwolves basketball team for the Target Center. Franchise asking for more aid.
2000:
• Xcel Energy Center built for the Wild hockey team with $65 million in city bonds and a $48 million interest-free state loan, plus a $17 million payment for state high school hockey tournaments to be held there. Franchise now asking that loan be forgiven, citing Timberwolves example.
2006:
• Legislature approves $392 million of taxpayer money for new Twins baseball stadium next to the Target Center, funded by sales tax hike in Hennepin County.• State approves $136 million for new Univ. of Minnesota football stadium.
• After failed move to Anoka County, Vikings pro football team proposes a $1 billion stadium in downtown Minneapolis. Then-NFL Commissioner Paul Tagliabue lobbies for public funding. Team could threaten to move to Los Angeles.
This waste hasn’t gotten much press since the bridge collapse. Instead, the hounds are sniffing Gov. Tim Pawlenty, who vetoed a gas taxA gas tax is commonly used to describe the variety of taxes levied on gasoline at both the federal and state levels, to provide funds for highway repair and maintenance, as well as for other government infrastructure projects. These taxes are levied in a few ways, including per-gallon excise taxes, excise taxes imposed on wholesalers, and general sales taxes that apply to the purchase of gasoline. increase. The governor should stand up and defend his veto as Minnesota already spends more than most states on roads. But instead he’s backtracking fast, possibly because the most recent sports boondoggles have occurred on his watch.
Minnesota’s sports moguls have had outside help extracting these enormous sums. Baseball Commissioner and Pohlad pal Bud Selig hinted after the 2004 season that Major League Baseball might disband the Twins. Pohlad had managed to break his lease with the Metrodome and threatened to leave Minnesota. Politicians couldn’t stand up to these titans and forced public funding through, against the clear will of the people, whose referendum process was ignored.
If the Vikings’ owners have their way and get a new stadium, the Twin Cities’ four major sports teams will each have its own stadium with major public financing thanks to compliant state-local officials. No other metropolitan area has caved in so completely.
In the meantime, President Bush (who himself received stadium handouts as owner of the Texas Rangers) and Congress have called for millions of dollars to help re-build the bridge.
Rather than looking to Uncle Sam for money to build a new bridge, Minnesota’s state-local officials should get their own financial priorities in order. Tell the Twins and other franchises that public money has a more important purpose than the construction of sports palaces. Tell them that the public would rather pay for a new bridge by reducing corporate welfare than by raising taxes on all drivers. If the billionaire takes his team and leaves over the new bridge, then so be it.
The author is an economist and sports fan at the Tax Foundation in Washington, DC.
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