Voice For Liberty

At Wichita City Council, why are some doors open, and others closed?

Bob Weeks

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Steve Compton, owner of the Eaton Steakhouse in downtown Wichita, spoke to the Wichita city council on the public agenda at its February 3, 2009 meeting.

(The public agenda is where anyone can speak about any topic for up to five minutes.)

Mr. Compton said he chose a bad time to start a business a year and a half ago. His business is just as important as others, he said, and he wants the city council to consider small business when making their plans as to which businesses to help. He said his business has 28 employees. He asked the city council for its support and consideration, without asking for anything specific.

Readers of the Voice For Liberty in Wichita know that I oppose subsidy to business. Therefore, I oppose Mr. Compton’s efforts. His request, however, illustrates the problems that arise when government chooses to subsidize some firms at the expense of others. This request is sort of the opposite case of the warning that Wichita Interim City Manager Ed Flentje issued to the council last summer regarding a loan interest subsidy made to the Warren Theater: “There are in this community much larger businesses with much larger employment who may see this opening as something that will open a door for those businesses to come and say, ‘You’ve done it before, you can do it for us.’”

Mr. Compton didn’t ask for a subsidy, but he must want something from the city. The problem is that the city — assuming it wants to — will have a hard time finding a basis on which to decline this request. That is, a basis that springs from any sense of equity, as it seems that Mr. Compton’s business doesn’t fall into any of the categories of economic development incentives Wichita has to offer.

The city dishes out economic favors at nearly every council meeting. For example, at today’s meeting the council is granting three Wichita companies a big favor, forgiving them from paying property tax on some of their property. These actions are being taken without any discussion except for the presentation made by Allen Bell, the city’s economic development director.

So why is the door open for some companies, but not others?

Comments

5 responses to “At Wichita City Council, why are some doors open, and others closed?”

  1. Ben

    Good luck Mr. Compton! You have to pay to play. The Mayor and Council members do not care that you are downtown or that you have 28 employees. You are not one of the chosen few. It is interesting to note that the Eaton Hotel with out of state owners received incentives totaling millions of dollars in addition to the mitigation of their debt.

  2. Todd

    I hope things turn around for Mr. Compton’s business. Consumers can be a fickle group to please – especially when your product or service is in oversupply (like Wichita sit-down restaurants).

    This oversupply will cause greater competition for consumers, and only those who best serve their customers’ needs will survive. Those who fall short will close their doors, sacrificing their market share to those who are better serving their customers.

    If there is any silver lining to this process, it is that the best companies (as chosen by the consumer) are the winners, and the worst companies are the losers.

    When the government intervenes, as Mr. Compton suggested, they get to hand pick the winners and losers. Some of these winners will be those who create the most value for their customers. Other chosen winners will be the companies that fail to do so, but remain profitable due to the crutch of public assistance.

    While it is unfortunate that anyone will have to go out of business, we’re fortunate that the everyday consumer gets to decide who does.

  3. In Wichita, Let’s Have Economic Development for All

    […] Consider the case of Steve Compton, owner of the Eaton Steakhouse in downtown Wichita, as described in my post (with video) At Wichita City Council, Why Are Some Doors Open, and Others Closed? […]

  4. Vyen

    For Ben, Todd & many of you – Wichitan, Kansasan, if you’re one of the locals, sad to said that you dare to pass your judgements without understand the whole issue such as Mr. Compton has with the local city goverment and what he’s trying to fight for the local small businesses. You should support your own locals vs the outsiders or the big corporates! Support the small businesses vs the big business or out of state corporations. Value the Comptons’ effort of renovating one of the landmark of Wichita without asking for any hand-outs from the goverment. Without their efforts of saving & preserving the Eaton Hotel lobby & its’ original grand ballroom and opening it to the public to enjoy, you, the locals will be missing such a grand tour of this historical place. So Go & Support the Eaton Steakhouse for the sake of the city and your locals instead of passing “your Jake’ as.. wind” ! The losers would be you without good folks like the Compton and many other local small business owners who tried their very best to do it right to help to developed the economic and growth of this city by providing jobs, goods and services to the locals and keep their spending power locally instead of out. Go & Support your locals !

  5. Public Effort Should Benefit All Taxpayers, Not a Select Few

    […] as large businesses and corporations when deciding who will receive economic assistance. My post At Wichita City Council, why are some doors open, and others closed? holds Mr. Compton’s remarks. The post In Wichita, let’s have economic development for all […]

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