Please consider the following for inclusion in your letters section, or as a “Your Turn” essay:
It is exciting to think about the River Trails white water park that is proposed for the downtown portions of the Des Moines and Raccoon Rivers. It would be a nice addition to the amenities that help keep and attract people and businesses to the Des Moines area.
But I don’t believe the results of the economic impact study that was done by Johnson Consulting for Capital Crossroads. As reported in The Des Moines Register, the study estimates that the Water Trails project will generate $104 million of Total Direct Spending at restaurants, hotels, stores, and equipment rentals during its first five years of operation. (See link to Register article below.)
For example, the report assumes that there will be 78,068 paying active participants of the River and Adventure Park features during the first full year of operation – spending about $78 each on food, beverage, and equipment rental. If we assume the recreational and related opportunities are open 365 days per year, it means that an average of over 200 people would use the facilities every day. That doesn’t seem reasonable to me.
In addition to the 78,068 active participants, the report assumes the project will attract an additional 80,000 non-active visitors, plus 15,404 more visitors from the Iowa Events Center, for a total of 173,472 visitors who will contribute to the total economic impact of the project during the first year – spending about $100 each that they otherwise would not have spent.. (The estimated number of users increases about 6-7% per year after the first year.)
The projections include the assumption that 60,000 of the visitors will stay overnight during the first year. That equals an average of 164 overnight visitors every day who would not have otherwise stayed overnight if there weren’t a River Trails recreation project. The report includes other unrealistic estimates.
It is probably impossible to calculate the economic benefit of any new attraction that is added on top of all of those that already exist in our metropolitan area. I suppose it is expected that an economic impact study be conducted before spending $117 million on a recreational project like this. The consultants do make proper disclaimers and disclosures in their report to notify readers of how estimates were made, and that actual results may be significantly different.
It is important that we not fool ourselves into thinking that we can accurately quantify the future economic impact of such a project. My gut feeling is that the indirect benefits of the River Trails project might greatly exceed the costs, but that the directly measurable economic benefits will not.
Governor Brandstad said he is open to increasing the sales tax to improve water quality in Iowa. (Des Moines Register, 5/3/2016, “Branstad open to sales tax for water quality” – link below) Specifically, he wants to implement the Natural Resources and Outdoor Recreations Trust Fund. Under the Iowa Constitutional amendment passed in 2010, the next three-eights of a penny increase in the sales tax must go to the Trust Fund. He suggested offsetting the tax increase by a decrease in the income tax – to make the change revenue neutral.
We all want clean water and nice recreation opportunities. But, what I don’t want is to pay farmers rent to not pollute. It appears that up to 50% of the tax collected could go to farmers to entice them to not pollute. The Constitutional amendment was a mistake. People want clean water and good recreational opportunities, but the way the Consitutional amendment was structured was a mistake. I think most Iowans voted their emotions, but would really not agree with the structure of the amendment. We need to repeal this amendment.
Contrary to the Des Moines Sunday Register opinion essay on 12/14/2014, Iowans did not vote four years ago to increase the Iowa sales tax by 3/8ths of a percent to fund conservation and recreation. Instead, Iowa voters made the easy choice to show emotional support for recreation and the environment without having to actually pay anything. Iowa is already doing very well on the recreational front without increasing taxes. We also already have substantial subsidies and other incentives to promote conservation and reduce pollution. If we want more funding for recreation, establish user fees. If we need to take further steps to reduce pollution, we should assess fines against the polluters. We do not need to tax ourselves $150 million per year in perpetuity. We made a mistake by amending our Constitution to commit any future sales tax increase to specific, narrowly defined purposes. We will not be able to change how we use the proceeds of any future tax increase without an amendment to our Iowa Constitution. We should not compound our mistake now by increasing our sales tax.
Link to Register opinion essay: http://www.desmoinesregister.com/story/opinion/editorials/2014/12/13/editorial-pressure-lawmakers-outdoor-fund/20387043/
“Iowa has enjoyed tremendous economic benefits by being a leader in both wind power development and wind manufacturing.” So wrote Mike Prior, Milford, interim executive director, Iowa Wind Energy Association, in a letter to the editor on 2/4/2012, (“Wind energy is important jobs provider”) He went on to extol the many benefits that Iowans have enjoyed as a result of the funding that taxpayers have provided to those in the industry. He urged that we, “… continue to invest in Iowa’s future.”
Good economic analysis must consider both what is seen and what is not seen. We see the jobs. We see the payments to farmers. What we don’t see are the other jobs that would have been created if people had been left to spend or invest their own money. Other jobs would have been created that would not be dependent on government handouts. Instead, we hear a never-ending story about how we must continue to provide taxpayer support or the investment and jobs will be lost. This is very typical when government creates new “incentives” and makes “investments” in what should be left to the private sector.
Welfare for wind energy producers is like all other special interest giveaways: the benefits are large and concentrated among the few who who are politically connected, and and costs are relatively small and disbursed among many taxpayers. This is a classic case in public choice theory. Those who directly benefit have a great incentive to lobby government to continue the subsidies, and those who pay the taxes don’t have a strong incentive to oppose any specific program.
We need legislators who will stand against political favors for special interest factions who press their political power for their own self interest.
Link to Register article: http://www.desmoinesregister.com/apps/pbcs.dll/article?AID=2014302040081
The Farm Bill should not pass until the following changes are made:
Separate the food stamp program (the SNAP program) from the rest of the farm bill. The huge size of the food stamp program dwarfs the farm subsidies and, in effect, hides them. Farm subsidies need to be exposed to a more open process. It would also help make the food stamp program more transparent.
Stop subsidizing crop insurance. Make farmers pay 100% of the cost. If that raises the price of food, so be it. If it reduces farmers’ incomes, so be it. Subsidizing crop insurance is not a proper role for our government. Today’s federally subsidized crop insurance not only covers losses due to unforeseen disasters, it also covers drops in revenues! If farmers had to pay the full price for their coverage, they might prefer higher deductibles and lower levels of coverage. But to add insult to injury,many farmer who receive subsidies are also very wealthy. There is no good reason why wealthy farmers should be subsidized, even for crop insurance. If our goal is to help poor farmers, then surely the subsidy should be phased out as a farmer’s wealth and income increase.
Establish a maximum amount of subsidy that can be received by any individual or commonly owned group of farms under all farm subsidy programs combined. Again, we shouldn’t be subsidizing big farmers or farm organizations.
Don’t place tariffs on imports unless the country of origin first places tariffs on our exports to that country. Free trade is beneficial to all. It is voluntary! It requires no intervention by government other than to resolve disputes. Free people should not be forced exchange or be prevented from voluntarily exchanging with another party. Amazingly, under the current Farm Bill, we pay Brazilian cotton farmers almost $150 million per year as compensation for the damage done to them by the subsidies we provide to our U.S. cotton farmers! Is that not insane trade policy?
Separate the “rural development” programs from farm subsidies. Again, the tens to hundreds of millions of dollars spent in this area are hidden within the much larger primary subsidy programs. It is questionable whether or not rural economic development is even a proper role of government. In any event, consideration of spending for rural economic development should not be mixed with farm subsidies.
Tie environmental practices to any subsidies granted. We shouldn’t expect perfectly clean water in our lakes and rivers. Wild animals have defecated in them forever. But, it reasonable to expect farmers to not fowl the water down stream from them, and to pay for damages when they can be reasonably determined. The idea of requiring minimum buffer strips between farms and rivers and lakes is reasonable.
It appears that our Earth is warming more quickly and is likely due, in part, to human action. Our climate has always changed and will always continue to change. The key question is: “What is the role of government?” I don’t think it is to try to stop climate change. Government has a proper role in regulating pollution of our common environment. But our air and water have never been perfectly clean. As our society has become more affluent, we have done much to clean up our environment. We still have work to do.
Government’s proper role is to help us adapt to the changes. Increasing the availability and lowering the cost of energy will improve our lives and our health more than government efforts to reduce carbon emissions to try to slow global warming. Taxing energy not only makes it less affordable, but Increasing the flow of money to Washington also has its own negative consequences.
We will be best able to adapt to climate changes if we are economically prosperous. People are more prosperous when energy costs are lower. Energy costs are lower when there is a truly free market in energy. Government policies that force us to be “energy independent” raise energy costs. Government should not prohibit free international trade in energy. We should stop subsidizing all forms of energy – treat them all equally. Government should regulate incrementally to continue to reduce pollution, but not make major changes that dramatically increase the cost of energy or that increase the flow of money to Washington.
Emotionally, I support the Water and Land Legacy bond proposal that Polk County, Iowa, voters will vote to approve or reject on election day. I want clean rivers and believe that it is a proper role of government to regulate our environment. But, if we feel that we should spend more on water quality and recreation, then we should pay today, not bind people in the future to pay the cost. As we have become more prosperous, we have done a better and better job of cleaning up our environment. We should continue our current path of spending what we can pay for today. Vote NO on the Water and Land Legacy bond proposal on the back side of your ballot.