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Opinion
Palm Coast Monday, Feb. 13, 2017 8 months ago

Why government incentives don't work, and why Enterprise Florida should be cut from the state budget

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Government should not pick winners and losers. Let's spend tax dollars on our top priorities, no corporate welfare.

Paul Renner

Guest Writer

As your state representative, I intend to fight for policies that promote prosperity and opportunity for everyone. There is no better example of the battle between your interests and special interests than the current debate over Enterprise Florida, which is giving away hundreds of millions of our tax dollars to a handful of already profitable businesses.

I am sponsoring a bill that would end these programs, which pick winners and losers among competing businesses through “economic incentives,” in which the state essentially pays companies to come to or stay in Florida. These so-called incentives violate several fundamental principles on which we all agree:

  • Incentives are unfair to taxpayers. They take from the many to give to the few. We have no choice whether to pay taxes, and every dollar you pay is a dollar you cannot spend on your own priorities. Everyone in our community is paying the bill, but the vast majority of us will never see one dime of this corporate welfare. We are willing to pay taxes based on government’s implicit promise that our money will be used to benefit everyone. Spending on public safety, education and infrastructure is consistent with that promise. Taking from the many to give to a few violates this most basic promise between government and its citizens.
  • Incentives take money away from truly critical priorities. Ask yourself and others in our community to name the top priorities on which government should focus. It is almost certain that Enterprise Florida will not make the list. In a world of limited budgets, the hundreds of millions that Florida is now spending on a handful of private companies represent money not available for public safety, infrastructure, education or other critical needs. As long as we have crime in our communities, roads to repair and students who are not ready for the workforce, we should not give away your tax dollars to businesses with healthy balance sheets.
  • Incentives ignore the small businesses that are Florida’s true job creators. We know that small business is the engine of the economy and accounts for the vast majority of new jobs in our state. Yet incentives include money given to out-of-state companies to come to Florida and compete against our small businesses. The majority of economic incentive money in Florida goes to businesses with more than 1,000 employees. If our goal is broad prosperity for our community, then we should eliminate Enterprise Florida and provide broad-based tax relief that benefits a broader group of businesses in this community. For example, Florida is the only state in the nation that taxes a business on the rent it pays. In fact, we even impose sales taxes on the payment of real estate taxes! Reducing this horrible tax would help all businesses, small, medium and large.
  • Government is incapable of beating the free market when it comes to choosing what businesses deserve support. Consumers reward businesses that best meet their needs and avoid businesses that don’t. If you provide great quality and a good price, your business grows. If not, it doesn’t. A government run incentive program ignores the consumer opinion of 19 million Floridians because it allows a business to take taxpayer money without proving its real value to you and me.
  • Funneling millions of dollars through government “decision-makers” inevitably leads to problems of improper influence and self-dealing. We recently learned that $9.1 million of your money was directed to a company led by the former head of Visit Florida. Apparently, before he left, he hired the new agency executive, and the new executive then awarded successive contracts to the man who hired him. A reporter’s request for details was met with a claim of confidentiality. These problems are systemic when government controls large sums of money and gets into the business of business where it does not belong.

This legislative session, we have the opportunity to end special incentives and promote economic development that benefits every business and every resident in our community. This effort will have bipartisan support, including fiscal conservatives like me, as well as principled liberals who share a distaste for corporate welfare.

Voters of every political persuasion want an end to favoritism and special deals. Stop spending our money to favor a privileged few. Instead, government should focus its resources on our most important priorities and get those right.

The best incentives for our economy are policies that broadly benefit all Floridians and expand the economic freedom on which real prosperity is based. We should promote reforms that spur economic growth and job creation, provide excellent education for a talented workforce, and strengthen the rule of law.

If government focuses on these foundational areas and stops picking winners and losers, Florida will become an even greater place of opportunity and prosperity — for everyone. That is my top priority, and I will never back down from that fight.

Paul Renner represents Flagler County and all of District 24 in the Florida House of Representatives.

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