Special tax breaks like those proposed for Revel caused Atlantic City to fail
By Seth Grossman, Political Columnist
(Reprinted from February 3, 2010 Current-Gazette Newspapers of Atlantic and Cape May Counties, http://www.shorenewstoday.com/news.php?id=7078)
“Insanity: Doing the same thing over and over again and expecting different results.” Albert Einstein (1879-1955)
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Republican politicians Frank LoBiondo, Dennis Levinson, Vince Polistina, and John Amodeo all want taxpayers to give $350 million in special state, county, and local tax breaks to the Wall Street and Chinese investors of the Morgan-Stanley-Revel casino project in Atlantic City. (Local taxpayers already gave $52 million last summer.) So do our daily newspaper, the construction worker unions, and Democrat State Senators Jim Whelan (Atlantic) and Ray Lesniak (Union & Middlesex). The Trump Organization and Greater Atlantic City Chamber of Commerce also support this deal. (Since New Jersey politicians whacked the Tropicana for not playing their game, even top casino executives now know their place!)
The only opponents are former Republican Governor candidate Steve Lonegan, we, the “Tea Party” people at Liberty and Prosperity, and Bob McDevitt’s union of restaurant and hotel employees, including those in four shaky casinos that may go under, if the Revel opens.
This is nothing new. For the past 35 years, career politicians and the big unions and big corporations who keep them in office for life told us that the key to economic growth is more government borrowing, spending, and taxes–then special breaks only for insiders when government gets too expensive.
But instead of admitting that this is what destroyed our economy, they still demand that we do the same thing over again.
In 1993 big corporations and big unions got big government to borrow $268 million for a new Atlantic City Convention Center far from the Boardwalk. In 1998 big government borrowed $90 million to fix the old Boardwalk Hall for Miss America and a new pro hockey team – both long gone. Then $170 million for an “eminent domain” based “corridor” to connect the two projects, followed by millions more in tax breaks, free parking garages, etc … to a private shopping mall developer.
The government borrowed $100 million to improve privately owned stores on the Boardwalk and $14.5 million for a baseball stadium. It “persuaded” three casinos to add $19 million to $11.8 million of taxpayer money for the ACES train fiasco that lost $6 million in just five months.
The baseball stadium is like an old Roman ruin, while the two new Convention Halls lose millions each year, and together have fewer events than the old one. Only the “corridor” stores at The Walk are a “success” – until you realize that all their business came from all the now dead shopping malls in the rest of the county.
These projects not only failed, but they caused Atlantic City to fail. The 1.25% CRDA “skim” on all casino winnings that paid for these failures could have cut taxes for everyone in the county. But even this money wasn’t enough. Republicans and Democrats hit Atlantic City tourists with a bunch of new “Casino Redevelopment” taxes that even I can’t follow. They include a 13% tax on hotel rooms, an extra 3% liquor tax, a $3 casino garage parking tax, a 9% luxury tax on other stuff, another $3 casino hotel tax, etc.
Many travel web-sites now warn tourists of these Atlantic City “rip-offs” – another unintended consequence when politicians borrow and tax to “create jobs”.
Atlantic City is in big trouble. Nobody can afford to build anything new. But this is because construction worker unions are too greedy, government permits are too expensive and hard to get, and state and local taxes are too high.
If you believe New Jersey’s motto, that liberty brings prosperity, and that liberty is one thing that cannot be enjoyed by anybody, unless it is shared equally with everybody, you would deal with the problem this way.
Cut construction costs by protecting the right of reputable non-union construction companies to fairly compete for casino work. Only competition with non-union companies and UAW give-backs made Ford profitable again. Make zoning and environmental laws simple, easy to understand, and realistic – then apply them to everyone equally. Don’t make ridiculous laws that nobody can afford–and then make exceptions for developers with the “right” attorneys, lobbyists and connections.
Cut taxes for everyone, not just a favored few. That can only be done by cutting the cost of government. Hire, fire, and pay “public” employees the same as everyone else. Refuse to pay any and all junk bonds that taxpayers are not legally obligated to pay.
Or make another special deal for Morgan-Stanley-Revel at the expense of everyone else–and expect a different result!
Somers Point attorney Seth Grossman appears live on WVLT-92.1FM heard throughout South Jersey 8to 9 am every Saturday. For information, see www.libertyandprosperity.org, e-mail grossman@snip.net, or call (609) 927-7333. Breakfast discussions every Saturday from 9:30 to 10:30 a.m. at the Athena Diner, 1515 New Road, Northfield.