Either We Believe In Capitalism Or We Don't

Capitalism Has Become A Dirty Word

Tallest Lehigh Valley building proposed for Allentown
Rudy Miller | The Express-Times

"Mayor Ed Pawlowski confirmed plans have been submitted by Salisbury Township developer Bruce Loch for a 33-story high rise at Ninth and Walnut streets in the city’s Neighborhood Improvement Zone."Will you be able to see the former Martin Tower from the top floors?

Just seems to me that NIZ is the 'redistribution of wealth on steroids?

I entitled this post for a reason. Here's Why...
Under 'capitalism' (private investment) the Empire State Building was originally financed by John J. Raskob and Pierre S. du Pont. Other iconic buildings in New York like the Chrysler, Woolworth, Grand Central Station, Rockefeller Center, GE, Met Life and dozens more too numerous to name were all built by private developers with their own money or through the sale of stocks.

Here in Lehigh Valley the Lehigh Valley Transit Company, Lehigh Valley Railroad, the 8th street bridge (built by the 'Allentown Bridge Company'), the three former anchor department stores on Hamilton Street were all built by private investors.

Private investment is the bedrock of what has made the United States like no other nation for nearly two centuries. Investors saw an opportunity to supply a demand. Developers using investors' money are near certain they can bring a 'return on investment' for the stakeholders. This is how 'capitalism' is supposed to work.

Lo these many years later taxpayers are picking up the tab for the former transit company buses, new office, business and sports centers. In short taxpayer money is being used to go where developers fear to tread. Which brings us to the biggest reason of all why 'capitalism' has served us well. When someone uses their own money they are 100% vested in the outcome. On the other hand when taxpayers foot the risks not one dime of any board member or politician is risking their own capital. It just goes against everything we ever learned from past history.

Anyone ever question why sports teams don't build their own venues?
Ever question why no investor today would even consider buying shares of stock to form a railroad?

Could it be they know, with almost complete certainty, there's little to no possibility for a return on their investment? Why then is this acceptable use via forced investment through our taxes at no risk to those who make those decisions for us?

Plain and simple: either we believe and trust in capitalism or we don't.


A couple of other thoughtsIf Pennsylvania can give up what will most likely end up being $1 billion (over 30 years of Allentown's NIZ) in tax revenue, it seems to me it could have came up with less then a fraction of that amount to solve Allentown's pension dilemma. Keep in mind much of that would have produced an economic return from pensioners as well. It also would come back to them in the form of various taxes. Perhaps then Allentown wouldn't privatize our water for the next 30 years.

In the United States it always amazes me how we are always too broke to afford money for the average Joe Citizen, but we're never too broke to...* Afford rail, oil and the like subsidies.

* Provide for Hundreds of 'Foreign Trade Zones' that shelter billions of dollars to go untaxed for various companies. There are 7 in Pennsylvania including 1 right here in the Lehigh Valley. Many of which oil companies use to export American oil & gas from in Alaska and in the Gulf states.

* Spend more on defense than the next 13 nations combined.

* Spend over $56 billion on foreign aid.Think about that next time the U.S. government talks about cutting Social Security, Medicare and the pensions most of us have already paid into.

I think of it this way. Allentown represents a microcosm of a this nation's underlying problem. That being, politicians at all levels spend money they themselves would not otherwise if it were coming out of their own pockets. I tend to think of this as a disease that eating away at our core economic principles based on sound investments with a reasonable expectation to see some sort of return. If indeed these taxpayer investments over these many years are of any value, why are we still seeing our taxes raised and our federal, state and local budgets spinning out of control?

I think the answer is obvious.