Sunday, December 23, 2007

Politics, Money, & Growing through Houses

marjorie says...

Regarding the increasingly serious mortgage crisis our nation faces comes this pretty straightforward, and on it's face pretty simple, analysis:

"We have the fundamental problem that we built too many houses and we charged too high a price for them," says David Wyss, chief economist at Standard & Poor's in New York. "We have to stop building houses for a while and the prices have to come down. We are trying to make sure that process doesn't derail the rest of the economy."

We live in an economy that measures it's success through "growth", which is largely measured through such indicators as the unemployment rate, job growth, and something called "housing starts." In the debate raging right now over Tax Increment Development Districts (TIDDs), those of us who think it's a bad idea to hand over large tax revenue streams to developers are labeled "anti-growth." But, frankly, I don't know how anyone with a modicum of sense could be "anti-growth" given the economic collapse that would surely follow if we stopped creating jobs. We live in a capitalist economy, after all, and the health of our community relies majorly on the existence of jobs. This of course is the reason tax subsidies are given to large corporations, and why we have other government sponsored initiatives and programs to help smaller companies succeed. In reality, having no government intervention in our capitalist economy would lead to a world of unsupportable dichotomies: beggars and kings, masters and slaves. You can catch a glimpse of what that world looks like in both the history books and the current affairs of this country--check out American slavery, the period of the industrial revolution, or the unprotected wage labor in our agricultural sector right up to today.

Obviously I'm not against public intervention in the economy. But, whenever it involves the use of public money to incentivize job creation there are serious issues that arise around accountability and transparency. These are big words that essentially are about not allowing a small group of people to enrich themselves at the public's expense. The question of how politics and profit intersect is a huge one, and not just in Albuquerque. This is the essential problem behind our push as a nation to find a way to eliminate private money from electoral campaigns. Then there's the revolving employment door...go out one side and you're a lobbying hack for big business, go out the other and you get to run campaigns or develop goverment policy. Get bored? Just step back in the doorway and come out on the flip side. We see it at the national level, and we most certainly see it in New Mexico. In fact we've seen it up close and personal when it comes to TIDDs in just the past couple of weeks. Is Marty Chavez in the pocket of developers? Is Mark Fleisher all about the money? Who knows, really? I don't know them. But that $5000 from SunCal is a lot of money. And Fleisher certainly likes that revolving door doesn't he? And what about Tim Cummins? There he is standing to profit enormously from the SunCal development, and he has no qualms about using his County Commission seat to push forward a massive tax subsidy to make it happen. Is there anything unique about any of this? I don't think so. This is a huge problem for us as a society, and I have to bugs me even more than the fact that we're balkanizing our tax base for the next couple of generations to bolster the bottom line of SunCal and Mesa del Sol.

On that point, despite what Cummins says, it isn't misinformation or lies when we point out that these TIDDs are, in fact, bolstering these companies' bottom lines. Our tax revenues are going to pay for infrastructure that these corporations are building. We're paying them directly, through a complicated shell game. And on top of that infrastructure will be built their profit making ventures: houses. And the houses will be sold at whatever price the market will bear. The city and county will use all those new houses to declare that Albuquerque is a "growth city"...a vibrant and thriving economy. But within the simplicity of those indicators lies a lot of consequences, some unintended, some completely obscured but with long-range impacts. These include in the case of TIDDs the negative impact on the State's general fund, not to mention the hit locally. But beyond this, there are all kinds of social and environmental issues with growth for the sake of growth measured in houses and their attendant highways.

Right now we're facing a real national economic crisis that derives from the unchecked housing starts growth machine. And if my memory serves me correctly, many of the same people who sounded a warning bell about the out-of-control housing market are the same people today who are labeled "anti-growth" in the face of Albuquerque's launch headfirst into incentivizing massive housing development on our west side. Rhetoric is fun. But frankly, it would be much wiser to instead take the blinders off and reconsider how growth is defined in the first place. Not to mention, we need to continue our efforts to take the money out of politics.