Wednesday, June 11, 2014

City for Champions: Colorado Springs

Being from Colorado Springs my entire life, I wanted to find something that was close to home to focus on when dealing with issues in today's society. This city has always been a breeding ground for stubborn people it seems; I say that in somewhat of a good way. It takes something big in order for the citizens of Colorado Springs to approve measures or give the "ok" for big time infrastructure changes. If you're from the Springs, you know how many Republicans are here compared to how many Democrats there are in places like Denver and Pueblo. Political differences like this greatly effect changes in our society. One of the major goals of the city lately is to create this tourist destination known as the "City of Champions". In this proposal, they would create an Olympic museum downtown, a new sports and event center, a new Air Force Academy visitors center, a sports and medicine performance center integrated with the University of Colorado at Colorado Springs, and a few improvements to parking garages and bridges downtown near the America the Beautiful Park. 
Knowing this city and the people who live here, this proposal has been quite controversial. Back before I was born, it was a massive deal in this city to create the airport out east. Looking at the City of Champions project, it would cost around the ballpark of 250 million dollars. They expect things like the Regional Tourism Act and donations from private donors to help pay for some of the cost along with issuing bonds and increased sales tax. Considering the Springs is fairly conservative, any mention of taxes frightens people and creates anger among the masses. After reading the One Lesson by Hazlitt, I try to look at this issue differently. The immediate reaction people have is "I don't want to pay more taxes." The problem though is that people here expect things to get better magically. If we want better roads or anything improved it takes money that must be collected from taxes. When the founds are finally reached, people will still complain and want laws and taxes changed. Using the example of the broken window in Hazlitt's book, we see the use of money changing because of a certain action. Money that is supposed to go to one thing is instead sent to another location. The citizens here do not look at taxes or other things in this sort of light. All they see is maybe a few more cents gone and that makes them grumpy. That money that is collected to create things like the City of Champions has greater impacts then they could ever imagine. The new jobs that would be created spur growth in the city. The increase in tourism would lead to a stronger economy which would lead to improvements in smaller things like roads and maybe even donations from the new business that were created due to the increase in tourism. All of these things could be effected positively if the city comes together and looks at the big picture. 
I use the broken window example from Hazlett's One Lesson because it stood out to me. I hadn't looked at the big picture when it came to what happens economically in society from the action of using money on something else compared to what you initially wanted to use it on. Hazlett also focuses somewhat on the "need" for things in order to create job growth or economic growth. Money that is used to create things that people want compared to what they need may be inefficiently used.  I think when talking about the City of Champions this is the main focus of what the citizens of Colorado Springs focus on; want versus need. All in all, Colorado Springs will always be an issue driven city that looks to find a common interest whether it makes economic sense or not. 


Garrett Coon said...
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Garrett Coon said...

Hey Dustin, interesting post, but I wonder if you could help me with something. It seems to me that the lesson of the broken window wasn't so much about money being moved to different ends, but rather that people tend to focus only on the results of the mandated end, the purchase of the window, rather than on the lost alternative ends, the purchase of a suit plus the continued ownership of the original window. In the case of the City for Champions proposal it would seem that the particular things proposed in the plan, the stadium, the museum, the visitor's center, etc., would each be examples of "windows" that the citizens of the Springs are being compelled to purchase whereas the things they would otherwise choose to do such as invest in their businesses or purchase products from one another, are in fact the unseen alternatives taken via taxation. Am I missing something in my analysis?

DustinKosley said...

Hey Garrett, I guess what my intention was to show how blind citizens tend to be towards how money is spent in society. I can definitely agree to your point that they look at the end much more compared to what it takes to get to that point. It was hard getting the City of Champions focused on one exact point related to Hazlett I guess so i tried to be a bit broad when it came to his teachings in the book. Not being able to discuss this specific topic in class probably made it a bit more jumbled up for me than it should have been. haha I completely agree with your analysis. I just felt that, especially in this city, this was one of the major economic issues that came to mind.

Larry Eubanks said...

"That money that is collected to create things like the City of Champions has greater impacts then they could ever imagine. The new jobs that would be created spur growth in the city."

Can you identify a "new" job? Hazlitt's lesson suggests we should expect there to be no "new" jobs. Remember Hazlitt explains that when government spends it also must tax. So to spend money on Champions, which will require some expense to hire labor, government has to take money (I would prefer we not say government "collects" money). The money taken would have been spent (if it had not been taken), and Hazlitt wants us to see what most people don't see. More tax revenue means hiring labor for Champions, BUT IT ALSO means hiring less labor elsewhere because people have less disposable income to spend. On net, it is jobs there or jobs here, and that means 0 net new jobs.

Local governments often pursue "economic development policies" by seeking "new jobs." It turns out there are very few actions local governments can take that will result in "new jobs" and in economic development. The kinds of actions that support local economic development tend to involve reducing taxes, since this makes doing business in the community less expensive relative to doing business in other communities.