Interventionism

Swamp refilling itself
08
Sep
By Bob Weeks

Swamp refilling itself

Although there has been progress, cronyism and the swamp may be renewed in Washington. Right under the nose of a president who promised to drain the swamp, one of the government’s shadiest handouts to large banks and big companies looks like it will be renewed for another 25 years. It will not get adequate oversight and congressional review. All it will take is the approval of two out of three U.S. Export-Import Bank directors, who are political appointees. That entity is called the Private Export Funding Corporation, or PEFCO. Veronique de Rugy is a Senior Research Fellow at the Mercatus…
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More Wichita planning on tap
05
May
By Bob Weeks

More Wichita planning on tap

We should be wary of government planning in general. But when those who have been managing and planning the foundering Wichita-area economy want to step up their management of resources, we risk compounding our problems. As announced by the City of Wichita, "In response to recent recommendations from Project Wichita and the Century II Citizens Advisory Committee, community organizations and their leadership are stepping forward to take the next step to create a comprehensive master plan and vision that connects projects and both banks of the Arkansas River." The city says these organizations will be involved: Downtown Wichita Greater Wichita…
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More TIF spending in Wichita
10
Sep
By Bob Weeks

More TIF spending in Wichita

The Wichita City Council will consider approval of a redevelopment plan in a tax increment financing (TIF) district. This week the Wichita City Council will hold a public hearing considering approval of more tax increment financing (TIF) spending in downtown Wichita. The spending is for the second phase of redevelopment of the Union Station property on East Douglas. According to city documents, the total cost of this phase is $31,000,000, with TIF paying for $2,954,734. [1. Wichita city council agenda packet for September 11, 2018.] This is a pay-as-you-go form of TIF, which means the city does not borrow funds…
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Tax benefits for education don’t increase education
27
Apr
By Bob Weeks

Tax benefits for education don’t increase education

Here's evidence of a government program that, undoubtedly, was started with good intentions, but hasn't produced the intended results. Tax season ended last week. Taxpayers have filed for over $30 billion in credits and deductions for college expenses they paid in 2017. Evidence now clearly shows that these credits have zero effect on college attendance. The tax credits surely make those who get them better off, but they do nothing to increase education. If their intent is to increase schooling, they are a failure. Continue reading at The Brookings Institution article The tax benefits for education don’t increase education.
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PEAK, or Promoting Employment Across Kansas
17
Nov
By Bob Weeks

PEAK, or Promoting Employment Across Kansas

PEAK, a Kansas economic development incentive program, redirects employee income taxes back to the employing company. An economic development incentive program in Kansas is PEAK, or Promoting Employment Across Kansas. This program allows companies to retain 95 percent of the payroll withholding tax of employees. PEAK incentive payments can be a substantial sum. Tables available at the Kansas Department of Revenue indicate that for a single person with no exemptions who earns $40,000 annually, the withholding would be $27 per week (for weekly payroll), or $1,404 annually. For a married person with two children earning the same salary, withholding would…
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Rich States, Poor States, 2107 edition
25
Apr
By Bob Weeks

Rich States, Poor States, 2107 edition

In Rich States, Poor States, Kansas improves its middle-of-the-pack performance, but continues with a mediocre forward-looking forecast. In the 2017 edition of Rich States, Poor States, Utah continues its streak at the top of Economic Outlook Ranking, meaning that the state is poised for growth and prosperity. Kansas continues with middle-of-the-pack performance rankings, and after falling sharply in the forward-looking forecast, continues at the same level. Rich States, Poor States is produced by American Legislative Exchange Council. The authors are economist Dr. Arthur B. Laffer, Stephen Moore, who is Distinguished Visiting Fellow, Project for Economic Growth at The Heritage Foundation,…
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Kansas economic development programs
08
May
By Bob Weeks

Kansas economic development programs

Explaining common economic development programs in Kansas. TIF projects: Some background Tax increment financing disrupts the usual flow of tax dollars, routing funds away from cash-strapped cities, counties, and schools back to the TIF-financed development. TIF creates distortions in the way cities develop, and researchers find that the use of TIF means lower economic growth. Click here. Tax increment financing (TIF) resources Resources on tax increment financing (TIF) districts. Click here. STAR bonds in Kansas The Kansas STAR bonds program provides a mechanism for spending by autopilot, without specific appropriation by the legislature. Click here. Industrial Revenue Bonds in Kansas…
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Rich States, Poor States, 2106 edition
12
Apr
By Bob Weeks

Rich States, Poor States, 2106 edition

In Rich States, Poor States, Kansas continues with middle-of-the-pack performance, and fell sharply in the forward-looking forecast. In the 2016 edition of Rich States, Poor States, Utah continues its streak at the top of Economic Outlook Ranking, meaning that the state is poised for growth and prosperity. Kansas continues with middle-of-the-pack performance rankings, and fell sharply in the forward-looking forecast. Rich States, Poor States is produced by American Legislative Exchange Council. The authors are economist Dr. Arthur B. Laffer, Stephen Moore, who is Distinguished Visiting Fellow, Project for Economic Growth at The Heritage Foundation, and Jonathan Williams, who is vice…
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Wichita TIF district disbands; taxpayers on the hook
14
Mar
By Bob Weeks

Wichita TIF district disbands; taxpayers on the hook

A real estate development in College Hill was not successful. What does this mean for city taxpayers? Seeking to promote the redevelopment of land northeast of Douglas and Hillside, the City of Wichita entered into agreements with Loveland Properties, LLC, College Hill Urban Village LLC, and CHUV Inc. The original plans were grand: A Northeast Brownstone Complex located at the northeast corner of Victor and Rutan, a Condominium Tower and Brownstone Complex, a West Brownstone Complex, and the South Retail/Residential Complex. A city analysis in 2007 projected that by 2010 the value of these projects would be $61,817,932. Unfortunately, this…
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Bombardier can be a learning experience
29
Oct
By Bob Weeks

Bombardier can be a learning experience

The unfortunate news of the cancellation of a new aircraft program can be a learning opportunity for Wichita. As Wichita seeks to grow its economy, the loss of a new aircraft program at one of the city's major employers is unwelcome news. Now it is important that our leaders and officials seek to learn lessons from this loss. But first, we must acknowledge the loss. Wichita economic development officials are quick to trumpet successes, but so far there is no mention of this loss from the city or its economic development agencies. The project received state, local and federal incentives.…
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12
Oct
By Bob Weeks

Export-Import Bank threatens a revival

Last week members of the United States House of Representatives successfully executed a maneuver that will force a vote on the reauthorization of the Export-Import Bank of the United States. The method used, a discharge petition, was signed by well over a majority of House members, including perhaps 42 Republicans. If the petition signers vote the same way, the bill to reauthorize the Ex-Im Bank will pass the House. It will then move to the Senate for consideration. No members of the House of Representatives from Kansas signed the discharge petition. In July a vote on an amendment in favor…
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WichitaLiberty.TV: Jeffrey Tucker and ‘Bit by Bit: How P2P Is Freeing the World’
05
Oct
By Bob Weeks

WichitaLiberty.TV: Jeffrey Tucker and ‘Bit by Bit: How P2P Is Freeing the World’

In this episode of WichitaLiberty.TV: Jeffrey Tucker talks about his most recent book “Bit by Bit: How P2P Is Freeing the World” and how Bitcoin and other distributed technologies are affecting the world. View below, or click here to watch in high definition at YouTube. Episode 97, broadcast October 4, 2015. Tucker's website is www.jeffreytucker.me. The book's page at Amazon is Bit by Bit: How P2P Is Freeing the World. Liberty.me is here.
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30
Sep
By Bob Weeks

Does Kansas have its own Solyndra?

Does Kansas have its own version of Solyndra, the politically-connected firm that failed and cost taxpayers some $535 million? We don't know. But the Abengoa cellulosic ethanol plant near Hugoton received a $132.4 million loan guarantee under the same program that benefited Solyndra. In January I requested documents regarding the Abengoa loan guarantee and risk assessment from the United States Department of Energy. I had several conversations and emails with a records clerk. We came to agreement as to what I would receive, or at least what I am requesting to receive. But I’ve received nothing so far. I don’t…
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Another week in Wichita, more CID sprawl
04
Sep
By Bob Weeks

Another week in Wichita, more CID sprawl

Shoppers in west Wichita should prepare to pay higher taxes, if the city approves a Community Improvement District at Kellogg and West Streets. Next week the Wichita City Council will consider the formation of a Community Improvement District (CID) surrounding the intersection of Kellogg and West Streets. CIDs are a relatively recent creation of the Kansas Legislature. In a CID, merchants may charge additional sales tax, up to an extra two cents per dollar. For more about their mechanism, see Community improvement districts in Kansas. In the present case, the developer proposes to charge an extra one cent per dollar…
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Wichita CID illustrates pitfalls of government intervention
31
Aug
By Bob Weeks

Wichita CID illustrates pitfalls of government intervention

A proposed special tax district in Wichita holds the potential to harm consumers, the city's reputation, and the business prospects of competitors. Besides, we shouldn't let private parties use a government function for their exclusive benefit. This week the Wichita City Council will consider the formation of a Community Improvement Districts to benefit a proposed hotel in west Wichita. CIDs are a relatively recent creation of the Kansas Legislature. In a CID, merchants may charge additional sales tax, up to an extra two cents per dollar. For more about their mechanism, see Community improvement districts in Kansas. In the present…
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Federal rules serve as ‘worms’ buried in promises of ‘free money’
05
Aug
By Guest Author

Federal rules serve as ‘worms’ buried in promises of ‘free money’

An often unappreciated mechanism throughout the Kansas budget severely limits the ability of legislators and governors to adapt to changing state priorities. A new paper from Kansas Policy Institute explains. Federal Rules Serve as "Worms" Buried in Promises of "Free Money" Mandates remove state control of budgets, exemplify increasing federal overreach July 30, 2015 -- Wichita -- An often unappreciated mechanism throughout the Kansas budget severely limits the ability of legislators and governors to adapt to changing state priorities. These Maintenance of Effort (MOE) requirements are highlighted in a new paper by Kansas Policy Institute and is authored by former…
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Friedman: Laws that do harm
24
Jul
By Bob Weeks

Friedman: Laws that do harm

As we approach another birthday of Milton Friedman, here's his column from Newsweek in 1982 that explains that despite good intentions, the result of government intervention often harms those it is intended to help. There is a sure-fire way to predict the consequences of a government social program adopted to achieve worthy ends. Find out what the well-meaning, public-interested persons who advocated its adoption expected it to accomplish. Then reverse those expectations. You will have an accurate prediction of actual results. To illustrate on the broadest level, idealists from Marx to Lenin and the subsequent fellow travelers claimed that communism…
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Friedman: The fallacy of the welfare state
22
Jul
By Bob Weeks

Friedman: The fallacy of the welfare state

As we approach another birthday of Milton Friedman, here's an insightful passage from the book he wrote with his wife Rose: Free to Choose: A Personal Statement. It explains why government spending is wasteful, how it leads to corruption, how it often does not benefit the people it was intended, and how the pressure for more spending is always present. A simple classification of spending shows why that process leads to undesirable results. When you spend, you may spend your own money or someone else's; and you may spend for the benefit of yourself or someone else. Combining these two…
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