Conservative, Yes. Sanctimonious, Probably. But Egomaniac? That’s a Bit Harsh.

by James A. Bacon

And now for another view…. John Fredericks, whose John Fredericks Show is heard in radio markets across Virginia, calls me a “sanctimonious conservative egomaniac” for asking questions about the use of the Governor’s Opportunity Fund to lure business investment to the City of Norfolk.

“It really irritates me,” said Fredericks on his show two days ago. “Any of these … 365 people in the Hampton Roads area that now have a job that didn’t have a full-time job, who can support their families, you know what, it’s a good deal for them, dude! … If you just got hired, and you got benefits, and you can now support your family, that’s a good thing. I’m for jobs. Period. … If you’re unemployed, and if Terry McAuliffe goes out and finds a business to hire you, he’s done a good thing.”

I’ve appeared on John’s show a couple of times, and I find him entertaining. (He refers to Governor Terry McAuliffe as “the Mackster,” which I do find amusing.) Indeed, because he is generally conservative in his views, I agree with a lot of what he says.

Believe it or not, John, I also agree that there are worse ways to spend government money than keeping jobs in Virginia. (If I have time this morning, I’ll post about some development expenditures in Virginia Beach that John might find questionable.) Job creation is the single best remedy for poverty and economic insecurity there is.

That said, given the resistance to paying higher taxes and the competing demands for state funds, Virginia has a finite amount of money that it can dedicate to economic development. We need to ensure that we spend these limited funds as cost effectively as possible. And when we spend money to shuffle jobs around the state — most of those “new” Norfolk jobs are coming from Roanoke and Virginia Beach — I don’t take it on McAuliffe’s say-so that we are getting the best deal possible, or for that matter that we’re getting jobs that we would have lost to other states. I’d like to see the proof.

Here’s what’s going on: Any time a corporation is ready to expand or relocate jobs, the top brass knows from experience that it has an opportunity to extract easy money from state and local governments by threatening to set up shop outside Virginia. They hire site-selection consultants to shop other locales and use that as leverage to extract subsidies and tax breaks. They almost always succeed in getting something. Once upon a time, the Governor’s Opportunity Fund was used to attract outside businesses to Virginia. Now it’s used extensively to keep Virginia businesses here.

Would Norfolk Southern and Movement Mortgage have made the decision to locate in Hampton Roads without the concessions? Economic developers don’t know, the governor doesn’t know, and the public doesn’t know. It’s a shake-down racket, and the only certain winners are the businesses in a position to negotiate special deals for themselves that other businesses don’t get.

The purpose of my original post, and this one, too, isn’t that McAuliffe should not have made the investment, it’s that we don’t know whether he made a good investment or not, and we will never know because there is insufficient transparency in the system. If corporations want to tap public funds, I argued, then they should waive any non-disclosure rights so citizens can evaluate the merits of the subsidy. Is that really so sanctimonious?

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7 responses to “Conservative, Yes. Sanctimonious, Probably. But Egomaniac? That’s a Bit Harsh.

  1. No, it’s not sanctimonious. Fear of not drawing the jobs leads to overpaying, just as fear skews other buying decisions. It is a lawful racket, like school proffers made by RE developers, sports arenas demanding public funding. Paying luring incentives has gone from perk to requirement. If the 365 jobs do not return sufficient revenue to the coffers, then the municipality overpaid. In the meantime, elected officials boost their job creation tally for the next election–no accountability.

    As for egomaniac, I can’t say having never met you 🙂

  2. I think I might be more on board with Jim if I was convinced he was, across the board in favor of more transparency and less inclined to selectively pick and choose – often with a partisan or philosophical axe to grind.

    I’m appalled at the lack of transparency in the General Assembly. More appalled at the GA-supported attacks on FOIA, the GA feckless approach to disclosure of money in politics , the fact that Dominion can give gifts to the DEQ regulators.. that schools do not have to account for discretionary spending and more while Jim seems to be focused on a more select subset that often involves a particular political or philosophical basis.

    So I see Jim’s interest not so much as a good public policy continuum… over several posts .. but rather directed attacks at implied wrongdoing…

    With these particular issues – jobs are paramount whether they come to us from the govt with deficit spending or via the private sector in which govt basically agrees to not tax them at the advertised rate – but rather lower rates – which Conservatives often argue is wrong to tax business to start with.

    so the complaint comes across as a little bit of a political double standard and really a little bit hypocritical.. but more than anything else – not a consistent across the board standard – regardless of whose political ox is involved.

    that’s my story and I’m sticking to it..

    • What’s wrong with arguing for a good policy outcome — greater transparency — loudest in situations that are particularly offensive to the arguer? That doesn’t mean transparency isn’t a good policy all the time, merely that you don’t have the time to demand it in every instance where it’s lacking. Like raising a teenager, you have to pick your fights! I don’t think the fact that McAuliffe was involved here makes Jim’s criticism of these deals involving the Governor’s Opportunity Fund either politically-motivated or sanctimonious!

      • Acbar – my perception is that the demands for “transparency” are spotty, and lack a generalized non-partisan, genuine public policy theme.

        The FOIA law is now under relentless attack by the GA – at the behest of localities and I see this as a far more important public policy issue that trying to ding some locality over some questionable economic development initiative – which you will find fairly numerous from those poor folks in Buena Vista , to Roanoke desperately trying to recover from losing NS and others to …. well you name it… localities, and the state ARE struggling for jobs – and they really don’t care too much about the how or why and that includes both GOP and Dem and yes most of them are pretty flaccid and not so good.

        so it’s a target-rich environment as they say… always good for a whack or two if BR runs out of something more cogent!

        Perhaps it’s time for a blog post that says ” The “right” way to do Economic Development using good old Conservative Principles”

        I’d like to see that one!

  3. I catch garbage because I question these overpaid yahoos. I don’t care – it means I’m doing my job as a citizen with the lacklaster and crap results we get out of most stuff.
    When I have to sue the govt. to get them to answer FOIA, you know people need to be booted out, so what this guy is yammering on, is beyond me.

  4. “Sanctimonious?” Egomaniac.”

    No.

    I’d just go with “Maniac.”

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