Letter to Mike Jerman of Utah Taxpayers Assoc.

[clarette]

Things that are irking me about this whole stadium fiasco:

a) Nobody's even put forth a concrete plan stating the exact costs and where the money is coming from (at least that we're privy to). There seems to be a lot of "we think it will cost this much to buy the land" and "Murray and Salt Lake both want the stadium" but nothing firm. Thus, it isn't easy to really opine on the actual costs.

b) Instead of beefing it on with the government officials and city leaders who are willing to give up city money to fund the stadium, people like the UTA and Radio From Hell are taking it to the media and making it more about the supporters. Fine, be opposed to the STADIUM and the public costs, but why make lame statements about the sport and the fans because you don't approve of public funding for the stadium?

c) We're finally getting a team that doesn't actually make me vomit, and everyone starts having kittens. Where was all this drama over the other stadia and the other teams? I'm sorry that lots of old people don't "get" soccer, but it's not going away anytime soon...

Okay. I feel much better now.

[clarette]

Well, I wrote the Regurgitation Machine, and this is what he wrote back:

"Thanks for your email.

Hopefully you understand that a one- or two-sentence comment in a newspaper article does not articulate our complete position on any issue, including taxpayer subsidies for a stadium. I encourage you to read our position on this issue at

http://www.utahtaxpayers.org/misc/2005_Soccer%20Stadium1.pdf

In addition to what we have posted at the above link, let me address some of your comments specfically.

1. RSL will divert existing spend from other types of existing entertainment-related consumption. I don't even recall mentioning existing spending on "other" sports specifically. Keep in mind the following

- Personal savings rates in the U.S. are near 0%.
- Utah's bankruptcy rate is the highest in the nation (double the national average) at 1 in 37 households per year, almost 1 in 4 per decade.

These economic facts demonstrate that Utahns as a whole are already spending as much as they are going to spend. Hopefully, you see the irony in raising taxes -- which reduces disposable income --- in order to get households to spend more money who are already spending nearly everything they earn. Are there individual exceptions to this? Certainly, but not nearly enough to justify increasing taxes by $30 to $50 million in a vain attempt to get Utah households to spend millions of dollars in addition to what they are spending right now.

2. RSL is asking for $30 to $50 million in public subsidies. The amount of money that you and other soccer fans are spending in other states due to Utah's lack of soccer is a small amount compared to the subsdiy that RSL is asking for, and there's no reason to assume that you and others will suddenly stop spending in other countries and other states simply because Utah now has soccer. I've been to a couple of soccer games in Europe (Leicester and Vienna), but that wasn't because Utah didn't have soccer. If I watch additional games in Europe, that will not depend on whether or not Utah has a soccer team.

As far as bringing tourist money into the state, this year the state will spend $10 million on promoting Utah to out-of-state residents. This $10 million will bring in more money than RSL will, the legislature did it without raising taxes.

3. I am suprised at your accusation that the Utah Taxpayers Association is mandating what sports you should be "allowed" to spend your money on, especially since you want to mandate that I and others -- through higher property taxes -- spend money on your sport. We don't care what money you spend on your sport, but you seem determined to make sure that I and other taxpayers spend money on your sport through a property tax increase.

4. $50 million is a lot to ask from taxpayers, especially considering the following

- Utah has the nation's third highest state/local tax and fee burden as a percent of personal income.
- Utah has pressing education, transportation, and public safety needs.

5. Any expenditure of public funds will have some positive impact, but we have to ask ourselves two questions:

- will the positive impact out weigh the taxpayer cost?
- could the same amount be spent elsewhere and achieve an even larger positive impact?

Bringing in a couple hundred fans from out of state a couple of times during the year does not justify spending $50 million in tax dollars. Not even close.

Experience in the U.S. and around the world clearly demonstrate that lower taxes -- not stadiums/stadia -- increase real, per capita economic growth. If high taxes caused higher economic growth, France and Germany would be experiencing more growth than comparatively low tax entities like the U.S., Ireland, Singapore, and Hong Kong. In fact, most high tax countries are struggling with unemployment rates that our double (or more) the unemployment rates in low tax countries.

6. Real economic growth is not about getting families to spend more money. Economic growth occurs when

- money and wealth are imported into the state. This happens when Utah companies export goods and services to customers out of state and when tourists visit Utah. Of course, if money is going to be spent bringing tourists into Utah, the number expected tourists would determine that amount of tax dollars to be spent. For $30 to $50 million dollars, Utah would have to bring in far more tourists than RSL will bring.

- worker productivity is increased, usually through increased/improved automation (computer hardware/software, machines, etc.) and worker training.

Finally, we are not anti-soccer. We would take the same position on a(n) (American) football stadium or baseball stadium.

Thanks again for your comments. Feel free to contact us again.

Mike Jerman
Vice President
Utah Taxpayers Association"

Dude, why didn't anybody TELL me I called up the Legislature and whoever else and demanded tax money? I mean, I must have been sleepwalking when I did that, because I certainly don't remember it...

[bordelais7]

Aside from his very condescending and accusatory tone, he did make some valid points. But it became obvious very quickly that he's picking and choosing statistics to support his point.

So, I'll do the same.

Regarding "Zero-sum economy", or "Substitution effect":

- Utah's bankruptcy rate is the highest in the nation (double the national average) at 1 in 37 households per year, almost 1 in 4 per decade.

Using this progressive mathematical logic, everyone one of you reading this, without exception, will declare bankruptcy in the next 40 years. Sorry to break it to you.

- Personal savings rates in the U.S. are near 0%.

...and my house is "near" Kentucky. Well, it is, when you look at how far away it is from other places.

Personal savings rates hit all time low rates of 1.1% (which, last time I checked, was MORE than zero) in recent years (2001-2004), dropping off from a previous 10-year average of about 8%. Bankruptcies increased dramatically during that time, jobs were lost, etc. All of this at rates that hadn't been reached since the depression (when personal savings rates hit negative 1.7 percent). And, as we all learned from our history classes, the Great Depression still rages on today. Oh wait, no it doesn't. I'm surprised that Mr. Jerman didn't just go ahead and use numbers from 1931.

The last indices for the first couple of months of 2005 already have personal savings rates hitting 3.5%. And rising.

Even still, would you rather have zero percent of a billion dollars, or 1.1% of a billion dollars?

In short, "Fuzzy Math", to borrow a recently popularized term.

So, take his comments for what they're worth. It's cool that he wrote back, but both sides on this argument are going to start throwing out numbers like this.

I think I'm just going to hide in my basement. Call me when the stadium is done.

[clarette]

I was so pissed off by his consistent use of "you", like I personally called up Gov. Huntsman and said, "hey, let's spend a gazillion dollars on a stadium" that I couldn't even look at the numbers.

Needless to say, I fired off another missive asking him when I, or the Loyalists, or any other RSL fan demanded taxpayer money and told him to go after Mayors Anderson or Snarr, or after Dave and Dean themselves, but to leave me out of it...

[DadOf8]

Maybe Utah wouldn't be first in bankruptcy and lowest in personal savings if we weren't the highest taxed state in the Western U.S. Even Californians pay less in taxes than Utahns do. I am encouraged by Governor Huntsman's support of the soccer team and the stadium. Let not your hearts be troubled.

[bordelais7]

Well, if it makes you feel any better...

http://moneycentral.msn.com/content/Common/Flash/P111507.asp?special=0502tax

Still want to move to CA? 🙂

[Deuce]

Cheese and Rice...!

I think I am going to be moving to Alaska...

:D

Originally Posted by bordelais7

Well, if it makes you feel any better...

http://moneycentral.msn.com/content/Common/Flash/P111507.asp?special=0502tax

Still want to move to CA? 🙂

[Jim Umber]

Originally Posted by Deuce

Cheese and Rice...!

I think I am going to be moving to Alaska...

:D

Yeah, but they don't have an MLS team. And it's a very LOOOOONG drive for a road trip.😉

[DadOf8]

I think I'll move to Preston, Idaho. I'll still be close enough that I can drive to the games. The tax burden on Idaho is far less than it is on Utah. Idaho has some great fishing too!

[bordelais7]

My solution is just to become Libertarian and not pay any taxes.

Might only be a short-term solution, though.