By William O Sumner
Proponents of the proposed $31.5 billion transportation tax increase contend that it will more than pay for itself by stimulating economic growth. Figures as high as $7 gained for every dollar spent have been touted.
This is utter nonsense.
The $31.5 billion in taxes will be taken away from profitable uses in order to spend it on profitless transit. This will add an extra deadweight burden on the local economy.
It will lower standards of living below what could have been achieved if the money hadn’t been taxed away from its rightful owners.
It will decrease the number of job opportunities, as growing businesses lose resources they could have put into expanding and employing more workers.
Rather than pumping money into the economy, light rail will siphon tens of millions of dollars per year out of our economy in order to prop up deficit-ridden rail operations.
Sure, some people will get rich from this income transfer scheme. Construction firms that build the light rail will make money. Banks that float the loans to finance the upfront costs will earn millions in fees and interest. Real estate owners prescient enough to be located near rail stations will see a windfall return on their investment.
The big losers will be taxpayers who each will have to make do with less in order to fill the pockets of the fortunate minority who will benefit from this boondoggle.
Don’t fall for well-financed, slick arguments of the scam artists.