It is not surprising that the Iowa Chamber Alliance advocates that the State of Iowa should provide more money to provide economic incentives for businesses to expand or locate in Iowa. (See The Des Moines Register, “Study: Iowa is losing its edge on incentives” 3/7/2013.) The economic incentives paid by States and municipalities to businesses have become obscene.
Our governments should not be in the business of trying to figure out which businesses or industries might be successful in adding good jobs in Iowa. When governments subsidize businesses, including farmers, we taxpayers take the risks and private individuals reap the benefits. This is not free-market capitalism, this is crony capitalism – where businesses that have political power are given special favors by governments.
It would be ideal if our U.S. Congress, using their Constitutionally granted Commerce Clause powers – to regulate commerce among the States, would prohibit the States from making any payments, or providing any subsidies that are not generally available to all businesses in the State. States would still be allowed offer general incentives, like lower taxes, but they would be prohibited from competing based on special incentive given to individual businesses.