The Twisted Logic of Stadium Construction
Wednesday, July 25, 2007
Filed under: Public Square, Culture, Government & Politics
For the past few years, there has been a movement to build a baseball stadium in Southern Maryland in hope of attracting a minor league franchise to the area. The community has a familiar mix of responses to this idea—some support the proposal on the grounds that it would increase tax revenue, while others are opposed because they're against population growth in a relatively rural area that's been developing steadily over the years.
But everyone seems to be missing the most important question: Who will pay for the new stadium? According to a 2003 report in the Baltimore Business Journal, a minor league baseball entrepreneur named Peter Kirk has been working with state and county officials to bring a franchise to Charles County. But like far too many other businessmen looking to build stadiums these days, he apparently expects taxpayers to help foot his bills. To wit [emphasis mine]:
Kirk said talks have been under way for months and said his Maryland Baseball group had signed a letter of intent to work with county officials to build a stadium and attract a team. He also said officials would be seeking seed money for the project in next year's state budget.
"Seed money”? According to the Maryland Department of Budget and Management, the state has cultivated this project by allocating $2.625 million between 2005 and today, and the state has already committed $4.7 million this year to stadium construction. At the local level, the Charles County board of commissioners has agreed to provide $1.5 million more than the previous board had for this new stadium construction, bringing the total county taxpayer commitment to $8.5 million (of the $25.65 million total cost so far).
What’s more, Charles County is financing Maryland Baseball’s one-third obligation with public bonds, which carry a lower (subsidized) interest rate than private bonds. That subsidy means taxpayers will take a hit in the event Maryland Baseball folds.
It is irrational to suggest that any for-profit business owner enters the marketplace for the benefit of “the people."
The question of whether or not Marylanders approve of a baseball stadium should be irrelevant. It frankly should be none of our concern because taxpayers shouldn't be expected to fund one in any case. Just like I didn't care what anyone else thought about my plans to build a house on a piece of land I purchased; just like it's none of my business what you do with your property so long as you cause no harm to mine. Sadly, however, irresponsible lawmakers have forced an otherwise private issue upon the public.
Much of the opposition today stems from a fear that the "big city" mentality (whatever that is) is going to tarnish the area's reputation for tranquil living; others are simply nostalgic for the "good old days" when farms and one-lane gravel roads ruled the day (along with the depressed economy). However, this is a problem of bigotry, not of the free market. How anyone can justify being "anti-growth" when he or she actually inhabits a particular area is beyond me—the "I can live here but you can't" attitude is more than hypocritical.
If an entrepreneur believes there's a market for a baseball stadium in Charles County, he can finance it with money he's procured privately, as he would be expected to do if he needed a loan for his daughter's tuition, a boat, a new car, or a restaurant business. And if he or his company doesn't want to own and operate the stadium, his team can rent from another company that does.
Why is Maryland Baseball seeking public subsidy in the first place? Is it because the company realizes it would be financially unwise to fully invest its own money? If this is the case, it follows that it is similarly unwise for taxpayers to invest theirs, not to mention immoral for anyone to expect (nay, force) them to—and it would explain why no private company has yet built a stadium in Southern Maryland.
Another possibility is that Mr. Kirk and state and local politicians believe it's the public's responsibility to pay for a stadium because it would ostensibly benefit from the tax revenues such a venue would produce. Such thinking encourages entrepreneurs in all walks of private industry to demand government subsidies, as it furthers the belief that producers and consumers have some manufactured obligation to one another. Nothing could be further from the truth.
It is irrational to suggest that any for-profit business owner enters the marketplace for the benefit of “the people." He only does so when he believes he can enrich himself by offering a good that others find valuable, which consequently tends to enrich those around him who benefit from his product. People who donate their own money and time are called philanthropists. They are not in the business of making money as a result of their generosity, but generally look to enrich the lives of others by donating their property.
That this is a bad "investment" is evident on its face, given that taxpayers will be collectively burdened with the expectation of paying for a venture many either may not want or realize is unsound. The only way anyone will ever know Southern Maryland is a viable location for a minor league baseball franchise is if it is paid for exclusively with private funds and turns out to be sustainable without support from coerced taxpayers.
Trevor Bothwell is a freelance writer living in Maryland. He maintains the Web log “Who’s Your Nanny?” and can be contacted at bothwelltj@yahoo.com.
Photograph © by Geren W. Mortensen, Jr.