The city of Georgetown has established an economic development corporation (GEDCO) with its own board or directors and budgets that grant economic development funds to selected organizations. In FY17, they plan on spending $6,235,967 on debt service and economic development projects.
Many call this corporate welfare. Government is not particularly good at picking economic winners and losers or knowing when to invest and when to stop investing. Don't expect our city officials to recognize when it is time to turn off the tap of taxpayer money.
The Texas Public Policy Foundation TPPF has recently completed a study of government sponsored economic development and relevant quotes follow:
"It is important to understand that corporate welfare has the same
corrosive effects as welfare for individuals and fails to live up to the core American
ideal of protecting “life, liberty, and the pursuit of happiness.”
For instance, if a large corporation used its expertise to break into the bank accounts
of Texans and transfer millions of dollars into its own account, everyone
would condemn this action as theft. Those who ordered and conducted the
raids would be prosecuted and locked in jail. However, let the government take
the money from Texans’ bank accounts and then give it to the same company
and it is called economic development.
Additionally, proponents of corporate welfare suffer from a false belief in
central planning. They believe that either they or government planners can
best determine what technology has the best chance of success, which jobs and
products best supply society’s needs, and where best to expend scarce supplies
of capital. They believe that they just can’t sit back and let the economy take care
of itself; they have to take money and property from citizens in order to solve
the citizens’ problems for them.
Recommendations
Texas is the national leader in increasing prosperity for its citizens. It has arrived
at this point because it has relied on the free market model of economic
development and protected the rights of its citizens while largely rejecting the
government approach. Building upon this approach, Texas should reduce or
eliminate current economic development programs, restrain growth in overall
government spending and regulation, and reduce taxes. Relying on markets is
the best way to promote liberty and boost the economy."
I am afraid that our current leadership does not understand the free enterprise system. Obama was the consummate picker of winners and losers. Here at home, I saw an article on the Georgetown plan for green energy. It is at least a year off schedule. Lets watch this boondoggle closely.
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