Let free markets determine downtown Wichita’s viability

“Wichita’s been an east/west town for as long as I can remember. Obviously, we’re trying to change that,” says Tom Johnson, president of the upcoming downtown project, WaterWalk. (Wichita Business Journal, March 4, 2005)

A healthy community needs a healthy downtown. … In Downtown, public investment has a proven track record of generating new, private investment. Since 1990, the government’s investment of $165 million has stimulated $248 million in private investment. (Voteyea.com website.)

“Anything downtown seems to be off-limits for criticism or analysis. I don’t know why it is,” Lambke said. (Council member Phil Lambke, Wichita Eagle, November 14, 2004)

If you listen to local Wichita news media, our local politicians, and various community advocates, the desirability of downtown development over other development is accepted as a given. But what people actually do with their own money is different.

Free markets, since they represent people voluntarily entering into transactions that they believe will benefit them, lead to the most equitable and efficient allocation of scarce resources. When left to their own free will, most people and businesses in Wichita have decided to purchase property somewhere other than downtown. I don’t know why people have made this choice, and that’s really not important to me. What is important to me is that people and businesses make the choice of where to invest voluntarily. By investing in parts of town other than downtown, they are assigning a higher value to non-downtown property. As far as I know, no one is forcing this decision. People and businesses make it of their own free will.

As it happens, some people don’t agree with the choices that most people and businesses have made. They believe that people and businesses should have purchased property downtown. They are, in effect, telling us that we have made a poor decision. They propose, and are in the process of doing just this, to trump the decisions of individuals and businesses with their own. They do this through the political process and the tax system. They take tax money and give it to businesses to induce them to locate downtown.

Why don’t businesses voluntarily locate downtown, using their own money? There can only be one answer to this question: When spending their own money, most businesses have decided that the most productive use of it is to invest it somewhere other than downtown Wichita.

It is adding insult to injury when we realize that the tax money given away comes largely from people who have voted — with their own dollars — not to do what these tax dollars are used to promote. It is a further blow when we realize that the money given to downtown businesses in the form of incentives makes our town poorer as a whole. Why is that? It’s because that most people and businesses, when exercising their own best judgment, have decided that investing in downtown Wichita is not the most productive use of their resources. When the government, using its power to tax, makes a different decision for us, resources are not allocated as efficiently and productively. Therefore, we are poorer.

The result of all this is that we have the spectacle of the people of Wichita, voting with their own dollars, making one choice. Then the politicians and various quasi-public organizations say, “No, citizens of Wichita, you are wrong,” and impose their will on the people of Wichita through their power to tax. How arrogant is that?

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