Gentlemen (Dear Commissioners, July 12, 2012) | Eastern North Carolina Now

Gentlemen,

    Professor Sowell is not singling out president Obama's policies, other than to see them as a misguided continuation of programs which every administration has forced on American taxpayers and consumers in order to placate special interests. Although, seemingly politically attractive, Prof. Sowell argues that these measures are ethically flawed and economically harmful.

    We have implimented the same shortsighted policies in Beaufort County by not realizing that a dollar given to one favored firm is a dime taken from ten other not so fortunate businesses and consumers. The result is that those taxpaying businessmen and consumers collectively have less money to spend effectively in our county because their money has been given to businesses whose product lines cannot meet the competition of the market place. This export of our local resources is a drag on our local economy. It hampers sustainable net job creation.

    Subsidized businesses literally export money out of our local economy. When unprofitable companies are unable to sell enough output at margins high enough to replace their manufacturing expenses, they beg for subsidies from local taxpayers to make up the shortfall. Since most input items are ultimately purchased outside of Beaufort County local taxes are literally being sent to other communities, yet these tax outlays are not being returned to our county because the volume of product sales revenue in a failing business is insufficient to create a positive cash flow. It is wishful thinking to believe that subsidies will change poor management or unattractive product lines, so the subsidy cycle will need to be repeated and costs to taxpayers will be ongoing.

    Since it is obvious that there is no net benefit should every taxpayer receives a subsidy from every other tax payer, we create an ethical hurdle of requiring that only a chosen few recipients be selected to be subsidized by the not so favored many. Tax increases paid by all residents are used to fund inefficient, failing enterprises to the advantage of businesses in other communities who ship supplies to our favored firms.

    There is a place for economic development. We have all sent income tax checks to Raleigh. Economic development should target recapturing those dollars for local firms and community groups while avoiding any matching grants or guarantees of grants which serve only to increase local tax burdens for no good purpose.

    Source article:

    http://www.realclearpolitics.com/articles/2012/07/10/jobs_versus_net_jobs_114746.html

Warren Smith