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Here We Go Again!

Louisville’s Galleria Deal Provides Over $16 Million of Taxpayer Money To Remedy Prior Screw-up

by Theresa Fritz Camoriano (7-16-01)

When will they ever learn?  What makes our politicians think they are experts in real estate development, health care, employment, and virtually everything else?  Certainly, their track record in any of these areas does not lead to such a conclusion.  In fact, virtually every time they meddle in something that could be handled by the free market, they screw things up and end up spending even more taxpayer money to try to straighten out the mess!  The Galleria in Louisville is just another example.

Just looking at the Galleria, we can see that some elected official bought the brilliant suggestion of some “urban planner” that the city would be better off if it were to close 4^th Street and create shops.  So here we are today with the Galleria being an unproductive, empty shell that is only minimally used.  Now, Mayor Armstrong has negotiated a deal by which he takes $16+ million of taxpayer money to subsidize the sale of the Galleria to a developer in the hopes that this new developer will turn the Galleria into a popular restaurant and entertainment spot.  So, the city’s previous brilliant plan of spending tax money to close off 4^th Street to create retail shops created a disaster that now is being replaced with a brilliant new plan of spending tax money to open up 4^th Street and create retail shops!  We can only hope that the latest brilliant idea actually works, but, given the degree of government involvement, I am not holding my breath.

In most cases, office buildings and shopping centers are built with private funds and no government involvement.  That is superior to government meddling for two reasons: 1.  First, the privately-funded projects do not involve plundering the taxpayers, and 2.  Second, people who are investing their own money are more careful, more savvy, and more likely to succeed than are politicians who are simply throwing around somebody else’s money.  However, our elected officials cannot resist the heady belief that they are ever-so-much wiser than the people who do this kind of risk-taking for a living.  And, since they have millions of dollars of our money handy to throw into these projects, they love to jump right in!

We can’t really blame the developers for being happy to take large chunks of taxpayer money to line their pockets and cushion their risks.  While we would wish that they had more pride and strength of character than to accept forced charity from hard-working taxpayers, it must be very hard to resist when elected officials offer to pour piles of tax money into your hands.  Who wouldn’t accept such a generous gift?  But these screwy political schemes don’t just result in turning buildings into unproductive empty shells and in lining the pockets of favored businesses.  They also harm the legitimate, non-subsidized businesses in the area.  How would you like to be the owner of a restaurant across the street from this new taxpayer-subsidized restaurant complex?  You have worked hard to build your place and make it successful, putting your own money and sweat into the project and paying taxes on your profits.  Would you enjoy seeing your tax money being used to subsidize new competition that might put you out of business? 

While a nearby hotel may benefit from this “investment”, a nearby restaurant will almost certainly be harmed.  Is it proper for our tax money to be used to subsidize some local businesses at the expense of others?  Should politicians be choosing which businesses will succeed and which will fail and using our tax money to do it?  Of course not.  This is not the proper role for elected officials and not the proper use of tax money.

The real blame lies with us voters who continue to re-elect politicians who recklessly throw our hard-earned money into these projects.  Of course, there is also plenty of blame for the news media, which blindly accepts the statements of politicians that these “investments” are good for the community, never questioning the politicians or reminding them of previous “investment” disasters.

No doubt we could do lots of good for the community if all those millions of dollars were left in our pockets for us to spend as we think best, rather than being in the hands of politicians to waste on another urban planning scheme or to benefit friends and harm enemies.  If we choose to spend our money on meals in downtown restaurants, then other restaurants will naturally be drawn into the area to satisfy that demand just as they have been in the Bardstown Road area.  However, it may be that we would prefer to spend our money on other things.  Shouldn’t we be free to make our own individual choices about which types of businesses we want to support?  And, while they would not make a big splash in the news, those freely-chosen investments would be much more likely to benefit the community and less likely to result in unproductive, empty shells like the Galleria.

It is time for us to tell our elected officials that we elect them to keep the streets in order (fill potholes and plow snow), to protect us from murderers, thieves, and rapists, and to enforce contracts.  We do not elect them to “invest” our money in real estate projects or other business “investments”.  We do not elect them to forcibly take money from taxpayers to line the pockets of friends at the expense of those who are not favored.  As long as voters and taxpayers accept the premise that elected officials have the right and duty to “invest” our hard-earned tax money in real estate development, business development, and other investment schemes, we can be sure that the elected officials will continue to make these reckless “investments”, which do great harm to the community.  While we certainly hope the Galleria project will turn out better this time, we also know it is time to demand that our elected officials stop this nonsense before the entire city becomes an empty, unproductive shell.