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HB 1230: Corporate Welfare Line Identical to Pro-Education Arguments

Last updated on 2011.06.07

Folks seeking to refer House Bill 1230 to a public vote in 2012 have until June 27th to gather signatures and submit petitions to Secretary of State Jason Gant.

The issue is not partisan; the issue is priorities. If money's tight, if we have to make choices, what comes first, kindergarten or corporate welfare?

Steve Willard of the South Dakota Electric Utility Companies supports the economic development grant fund to be created by HB 1230. His arguments on KELO make big business sound like a frail creature dependent on the state for its survival.

Let's have some fun: let's put some different words in Willard's mouth. Imagine he were an opponent of HB 1230, making the exact same arguments for education funding. Here's what Willard would have said in an alternative universe. My substitutions to the KELO text are emphasized:

"We thought we were pretty well poised to try and create jobs," Steve Willard, the executive director of the South Dakota Education Association, said.

Supporters of education funding, like Willard, say it's especially important to have education funding during an economic downturn.

"You've got families and teachers trying to figure out what to do in Illinois, what to do in California; you're trying to figure out what to do in Arizona (not to mention Brookings, Yankton, Worthington, Mankato...) and so it's the perfect time for us to be competitive," Willard said.

...Supporters of education funding say education funding will help generate new business and new construction and ultimately bring in more dollars, which means the amount that goes into the general fund won't take a big hit.

"In theory, keeping teachers on the job, building schools, and investing in children are going to drive an awful lot of that contractor's excise tax, so it makes it essentially self-funding," Willard said.

Willard says when more families, students, and teachers come to the state, it will also bring in more taxes that can go to education and economic development.

"If we sustain education funding, then it means congratulations; we're delivering a lot of growth. Well that's going to bring jobs. That's going to bring sales tax. That's going to bring property tax and those are all things that lend itself to education down the road, so it just seems short-sided [sic]," Willard said [text significantly modified as a hypothetical exericse, based on Ben Dunsmoor, "Funding Priorities," KELOLand.com, 2011.06.06].

Citizens seeking to refer and repeal the governor's corporate grant fund can make the same arguments about investing in growth and prosperity as defenders of HB 1230. Education does at least as good a job long-term of generating all the economic development benefits Willard touts for corporate welfare.

Plus, education is a public good that the state constitution requires and that the free market cannot and should not provide. Corporate welfare defies the logic and principles of the free market that Governor Daugaard and his corporate friends espouse.

South Dakota already goes the extra mile in providing low taxes, low wages, hard workers, low crime, cheap housing, easy traffic, fresh air, and pheasants, walleye, and water-skiing. When businesses tell us they need a government handout on top of all that to turn a profit here, we should tell them to examine their business model... and spend our money instead on a better investment in our future: our kids and our schools.

9 Comments

  1. troy jones 2011.06.08

    Cory, you didn't really make this argument and mean it did you?

    Reality #1: Government has limited resources.
    Reality #2: Demand for services will always exceed its resources.
    Reality #3: Every advocate for every government service believes their purpose is "critical."

    Thus, every advocate for every purpose could do the same thing. As a debate judge, you should grade this post as a big loser.

    I cant remember what the call this logic fallacy but it is fatal. For your reputation as a debate judge, delete this. Otherwise every debater will think if the can play on your "values/priorities" and substitute them as an argument.

  2. caheidelberger Post author | 2011.06.08

    Sure I meant it.

    If my argument using these words is invalid, then so is Willard's. The debate over HB 1230 is about priorities. Willard needs to show we should place a higher priority on handouts to private corporations than funding for public education. The arguments he makes in terms of jobs and economic development do not establish such a priority, since education advocates can argue quite reasonably that education is at least as essential to economic development as corporate welfare.

    If this were a formal HS policy debate, with Willard and Daugaard offering the Aff plan of HB 1230 and Neg offering a counterplan to spend the same money on education, my flow would look like this:

    Advantage 1—Jobs/Economy: a wash.

    Advantage 2—Free Market: Neg wins, showing education counterplan better satisfies Adam Smith's proper roles of government, while Aff plan skews and weakens free market.

    Advantage 3—Constitution: Neg wins, showing education counterplan directly satisfies state constitutional mandate. Aff does not rebut, makes no comparable claim for Aff plan.

    I think the policy kids would look at your Aff plan and your response and say you have no offense on the flow.

  3. LK 2011.06.08

    Cory,

    With all due respect, I think Troy is probably making an LD argument or a running a K.

    Troy writes,
    "Cory, you didn’t really make this argument and mean it did you?

    "Reality #1: Government has limited resources.
    "Reality #2: Demand for services will always exceed its resources.
    "Reality #3: Every advocate for every government service believes their purpose is 'critical.'”

    He seems to be setting up a value/criterion premise here: limited resources means that government must make wise and just choices.

    Troy now has the burden of explaining why it's just to take sales taxes from the rich, poor, young, and elderly but reduce taxes on corporations who may produce any benefit for the state. I'm not sure how to illustrate that idea is just, but I'm not running that case.

    I would guess he needs some direct refutation of this Nathan Johnson article that you have blogged about.

    I guess one could make the case it's wise to ignore studies about the limited benefits of tax breaks for jobs and economic development. I wouldn't try it, but I'm kind of conservative that way.

    Finally, I'm not sure if I'm supposed to remember Troy's debate background. If I am, I apologize for not doing so. That being said, every debate coach and debater has a some sort of file that sums up what each debate judge claims to want to see and hear in a round. We all try to adapt. In the case of LD or critical policy debate, we all appeal to values. Cory hasn't lost any street cred with this post. I'll add it to our files. : )

  4. caheidelberger Post author | 2011.06.08

    Agreed: Adv2 and Adv3 are much more easily run as value contentions or justification. I can imagine spinning them into full-fledged policy disadvantages:

    DA2.1: use Nathan J's article to build an argument that bsuiness subsidies will lead to a race to the bottom, weaken tax revenues elsewhere, lead to collapse of infrastructure.
    2.2: Aff plan weakens businesses, makes them dependent on government; U.S. competitiveness declines; triple-dip recession; nuke war.

    DA3.1: Aff prioritizes extra-constitutional activity over direct constitutional obligations; plan pushes Tea Party grumpiness to open rebellion; Paul/Bachmann win 2012 pres. election; all liberals deported; nuke war.

    I've heard nuttier in rounds!

  5. Troy Jones 2011.06.08

    Maybe this exposes why I wasn't a great debater.

    My point is if after affirmative makes their point, negative regurgitates the same argument with the insertion of "not" (or in this case the "students/teachers" vs. "employers/employees" with nothing else, how would the negative be judged? Not very well.

    It is in the interest of a government to have both a good education system and jobs/economic development. If every argument/discussion is presented in a zero sum game, we will have neither and that is what Cory did.

    Willard made his case for the incentive. Cory just borrowed Willard's arguments and substituted his priority. He didn't argue they don't create jobs or improve economic development. If that is the depth of intellectual discussion, no wonder we can't solve problems and create opportunities. We just talk past each other.

  6. Guy 2011.06.08

    I will reiterate with less words what I have posted before: our government is funded to: 1) protect us from enemies wit in and outside our borders, 2) provided emergency services , and 3) provide vital services to those in our society who have fallen through the cracks. Our government was not funded to provide bailouts for any private enterprise.

  7. Guy 2011.06.08

    ...And enough with the "economic development" grants argument. If private enterprise wants to invest in our state, then, so be it with its own profit. In these times of fiscal deterioration and spending constraint, the government must save its funds for the three major priorities that I stated in the above post. The 3 major traditional and intended priorities established by the Founding Fathers.

  8. LK 2011.06.08

    Troy,

    Your second comment clarifies your point. Thanks.

    I think Cory is just trying to make a point about priorities with his post. Substituting "education" for "corporation" is a way to show that education should be a priority because the argument for corporations is relatively non-unique.

    You seem to put your finger on an important point, however, when you conclude ". . . no wonder we can’t solve problems and create opportunities. We just talk past each other." I wish I knew how to solve that problem.

  9. caheidelberger Post author | 2011.06.08

    Willard asserts that handouts to business promote economic growth. I borrow his words and asset education promotes economic growth.

    LK reminds us of the Johnson article pointing to evidence rebutting Willard's claim for biz handouts. I haven't heard any evidence rebutting my claim for prioritizing education funding.

    The National Conference of State Legislatures provides evidence that investment in early childhood education produces significant return on investment in economic development (not to mention being a good moral thing to do for little kids).

    I can tie at least 200 jobs lost to Governor Daugaard's education cuts. HB 1230 has to restore that many jobs just to break even.

    The economic development argument is non-unique, meaning it doesn't win the debate. Add the free market and constitution value positions, and the anti-HB 1230 position is winning. That's not just talking past each other: that's Neg showing that Aff hasn't met its prima facie burden (if we interpret this as a policy round) or that Aff has failed to demonstrate the superiority of its value or an ability to uphold its value better than Neg can (if we interpret this as an LD round).

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