Wednesday, July 13, 2005

Can the Govt. Pick the Winners

The Dems who run the N.C. govt. have come to rely more and more on targeted incentives to lure business to the state or to keep business in the state. Using targeted incentives reveals an underlying belief that, despite all evidence to the contrary, the government is good at picking the winners in business. The N&O today reveals the latest incentive scheme by the Dems to lure a Cheesecake Factory bakery to the state.

Now the govt. can intervene with taxpayer money to help certain people or small groups of people succeed in the short run. Those who make the decisions of where the taxpayer money goes may reap the short-term benefits of campaign contributions or trips to various locales from those who receive the largesse. But in the long run the best way for states to attract business is to create an environment where taxes are fair and low, regulations are not onerous and the threat of large liability lawsuits from folks like John Edwards are limited. Those rules should apply to all businesses equally and not to the chosen few.