I finally found my way last week to see a game at the new Braves stadium in Cobb County.
The team stinks, but the stadium is first-class. The seats were comfortable, the lighting wasn’t harsh and the food was good.
And yet, sitting there, I had a difficult time getting beyond this thought: “The poor taxpayers of Cobb County got screwed!”
Indeed, the deal to abandon the “new” Turner Field downtown (a field one critic pointed out was not as old as Miley Cyrus) and decamp to Cobb was done in secret by that county’s board of commissioners chairman. The chairman — and eventually the entire county government — violated all kinds of government ethics, public meeting laws and transparency rules to do the deal for the stadium.
The county eventually put in over $400 million (yes, million) for the stadium and infrastructure, an amount that was never voted on by its citizens. If there was any justice, the chairman who led that debacle was booted out of office in the last county election.
But this wasn’t the first time a Georgia government pissed away taxpayer money to build a stadium. Gwinnett County spent $64 million for the Braves Triple-A team stadium deal a few years ago, a move that sent the county into a financial tailspin when all the promised “new development” that was supposed to follow didn’t happen.
And Atlanta has just finished building the new Mercedes-Benz football stadium for the Falcons, a move that will reportedly total over $700 million in public subsidies. All to abandon the young 25-year-old Georgia Dome.
This is nothing but corporate welfare and crony capitalism for the uber-wealthy.
The Braves are owned by a multi-billion-dollar company (Liberty Media valued at over $13 billion). Their highest paid player, Matt Kemp, makes over $21 million per year while player Freddie Freeman makes over $20 million. No Braves player makes less than $500,000 per year.
The Falcons are owned by Arthur Blank, owner of Home Depot, whose wealth is said to be over $3 billion. Quarterback Matt Ryan makes over $23 million per year while receiver Julio Jones makes nearly $14 million.
These aren’t poor people. These are extremely wealthy corporations that are having their businesses heavily subsidized by taxpayers through secretive, insider deals with local governments. (And tell me please, why didn’t people get just as upset about that abuse of the public trust as they are about NFL players taking a knee during the national anthem?)
None of this is new, of course. But it’s about to get even bigger.
Georgia leaders are getting ready to open the state’s checkbook — read taxpayer money — in a bid to lure Amazon’s second headquarters to Atlanta.
That project is “THE” economic development deal of the decade and every major city in the nation wants it. Georgia is believed to be in the running for the project because of Georgia Tech’s engineering programs and access to a major airport.
But to get such a large project, states will be throwing around millions, maybe billions, of taxpayer dollars. Amazon is promising to bring 50,000 high-paying tech jobs to wherever it decides to locate. That prospect has the political class salivating — what governor doesn’t want to be remembered as the guy who landed such a potentially game-changing development?
But all of that is still corporate welfare. It’s taking taxpayer money and giving it to a wealthy company in the form of special tax breaks and subsidies.
The political/corporate class doesn’t see it that way. The selling point for subsidizing stadiums, auto manufacturing plants or Amazon is that in doing so, new jobs will be created. Over time, the politicians argue that individual taxes paid by employees and the “multiplier effect” will generate more taxes and pay back that initial development.
But it doesn’t always work out that way. Look at the nation’s biggest recipient of corporate welfare, Boeing. In 2013, the mega aerospace firm pressured Washington state to give it a huge $8.7 billion tax incentive to stay in the state under the threat that it would move elsewhere if the politicians didn’t do the deal. But after Washington caved to Boeing, the firm turned around and laid off over 12,000 employees in Washington.
Maybe Washington state learned a bitter lesson, but other states and local governments, including Georgia, continue to dole out corporate welfare. Kia Motors got a $410 million subsidy to locate in Georgia. Shire, an Irish pharmaceutical company, got $211 million of our tax funds.
And that’s just the tip of the corporate welfare iceberg in Georgia. NCR and Engineered Floors both got over $110 million; Caterpillar got over $77 million; Toyo Tire got $71 million; and Anthem Insurance got $51 million. Dozens of other firms, including Coca-Cola, Blue Bird Body, AFLAC, Mitsubishi, Pilgrim’s Pride and a slew of real estate firms have gotten state grants, property tax abatements or tax increment financing from state and local governments.
But the corporate welfare dole doesn’t end with these big, wealthy Fortune 500 firms. Georgia also has special tax credits and incentives for the film and television business, too. Transferable tax credits for up to 30 percent of production costs subsidizes the film industry in the state. It’s an effort to make Georgia the next Hollywood. But as with professional sports teams, those credits subsidize an entertainment industry where million-dollar salaries are common.
For 2017, the Georgia film industry tax credits will cost an estimated $376 million, but despite that high amount of investment, the state has created no mechanism to measure the overall impact. In other words, despite handing out huge subsidies to the film industry, Georgia hasn’t done a cost-benefit analysis to see if the payback has been worth it.
Maybe some of these corporate welfare deals do have a return on investment (although I have serious doubts.) Even so, there’s something smarmy about the state’s “conservative” political leaders ranting about “welfare queens” and cutting back on food stamps while at the same time, they’re handing out billions of taxpayer dollars to wealthy corporations in the form of subsidies, tax breaks and grants.
That’s not a free market, that’s crony capitalism. It’s a system where the political class takes our money and gives it away to mega-rich firms under the guise that it’s an “investment.” (Amazon is worth $430 billion, twice as much as Walmart.)
Georgia taxpayers get ready — state leaders are poised to give millions, if not billions away to Amazon to lure that firm’s new mega-headquarters to Atlanta.
Let’s call that for what it really is: Corporate welfare that would make Amazon the biggest welfare king in the state, if not the nation.
Mike Buffington is co-publisher of Mainstreet Newspapers. He can be reached at email@example.com.