Bacon's Rebellion

Democracy Thrives in Sunlight

Economy 4.0: Measuring Prosperity

—

by

James A. Bacon
in ,

Stop any 10 people on the street in Virginia and ask them, “Who has a higher standard of living — the inhabitants of Roanoke County or Loudoun County?” I would wage that all 10 of them (assuming you could find 10 who had actually heard of both counties) would say Loudoun County. Oh, sure, Roanoke is surrounded by beautiful mountains and all that, but the economy of the Roanoke Valley isn’t exactly setting the world on fire. By contrast, Northern Virginia is where the job creation is, the entrepreneurial success is, the material prosperity is. And Loudoun is at the epicenter of growth in Northern Virginia.

But let’s take a look at the numbers. According to the Bureau of Economic Analysis:

2005 Per Capita Income
Roanoke/Salem………….. $35,140
Loudoun/Leesburg………..$41,193

First impression confirmed. Loudoun County’s per capita income is 17 percent higher.

Now, do this: Go to the CNN cost of living calculator, and see what you have to earn in Loudoun County to get the same standard of living as Roanoke County. It’s $45, 695. In other words, adjusted for the cost of living, Roanokers are 10.9 percent better off than Loudounites! (The gap looks even worse if you take into account the highly progressive nature of the federal tax code that punishes regions, like Northern Virginia, with high nominal salaries and wages.)

That simple comparison leads me to the key insight of the second installation of “Economy 4.0: Measuring Prosperity“:

Thanks to the federal tax code, affluent Virginians are subject to high taxes on every extra dollar they earn. Strategies geared to increasing incomes are worthwhile, but they are pushing the rock up-hill. A more effective way to raise comparative living standards in Virginia may be to hold down living costs.

In “Measuring Prosperity,” I also discuss the implications of the “time famine” on living standards, the vulnerability of living standards to rising energy costs, and the impact of environmental degredation on the stock of Natural Capital.

Bottom line: Public policies that increase incomes are good. But public policies that increase incomes while simultaneously driving up living costs, consuming more energy and degrading the environment by perpetuating dysfunctional human settlement patterns are misguided and counter productive.

Can anyone say, “Fundamental Change?”

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32 responses to “Economy 4.0: Measuring Prosperity”

  1. Lyle Avatar
    Lyle

    Interesting. Targeting cost of living makes huge sense, I bet there would be a much larger ROI there. Even simple shifts in taxes would make a big difference in lowering cost of living. Taking taxes off of buildings and putting them on land would increase the supply of affordable housing and fight sprawl, reducing travel costs. Allowing our power companies to profit from efficiency like Idaho does would help keep energy costs low. Tax breaks for efficiency improvements would be a fine thing too. I’d love to see the numbers on these strategies.
    We could also work on lowering our state income, business, and sales tax and put them on pollution instead, rewarding efficiency again and encouraging business and earnings.
    Thank you for some good food for thought.

  2. Lyle Avatar
    Lyle

    That last idea I mention of shifting taxes from families and onto pollution was recently announced as a fundamental part of the Blueprint for a Green Economy by the Conservative Party of the United Kingdom. It is beautiful in its scope, principle, and reliance on effective market solutions. It warms my heart. This is the most exciting serious policy document that I have seen.

  3. Anonymous Avatar
    Anonymous

    OK Jim. Now go back and do the same analysis but pased on the percapita value of property assessments. This will give you an idea of how much wealth the people have captured as a result of their incomes.

    It is interesting to me that EMR would claim that the prices paid for housing and business space near the core prove that it is what is most valuable and what people desire the most. Your argument seems to agree with mine, that it is value that people seek the most: what you get for your money. Apparently you get 10.9% more in Roanoke, and I suggest we have more places like Roanoke.

    RH

  4. Anonymous Avatar
    Anonymous

    Lyle:

    We want government to provide needed services the most efficient way possible and at lowest cost.

    Certainly there are reasons to do some social engineering through the tax code, and we do it all the time. It is a major reason the tax code is so complex now.

    I’m not convinced that the ideas proposed in the articles you mention will make tax collection any more efficient or cheaper. I’m not convinced that those that ultimately pay the taxes will be the polluters.

    What happens if you put a pollution tax on fine particles, and then you find out that because of the monitoring and lawsuits involved tht it costs you four times as much to raise the same money?

    We now have significant safeguards to make sure that those who simply do not have enough to pay their share of taxes don’t starve to death trying. If we focus only on taxing the polluters we may lose the possibility of ensuring a reasonbly fair progressive tax base. Or, if we build in all the present sfegurads on top of the polluters taxes, we could wind up with a tax code that is far worse.

    Then there is the possibility that if you put extremely high taxes on sin that people will stop sinning and we can go to fiscal insolvency in a state of purity.

    Don’t get me wrong. I support the ideas proposed, but I think they are being hugely oversold and oversimplified. We have a better chance of getting waht we want by being more realistic about the results, and the costs of getting therre.

    RH

  5. Lyle Avatar
    Lyle

    RH:

    Agreed, there will be some implementation challenges with some cost of living strategies. The way to move forward is to get all the information on the table, hash out what works and phase that in. If it doesn’t pass muster (like if the costs are higher than the return), it doesn’t fly.
    Imagine if NoVa had a higher quality of life and lower cost of living, in addition to a hot job market. I’m not sure I can yet.

  6. Jim Bacon Avatar
    Jim Bacon

    I am posting this observation from Doug Koelemay with his permission. I thought his 9.5-percent rule of thumb would contribute to a calculation of whether the VW relocation will pay for itself or not. Jim Bacon.

    Good discussion of the assumptions behind the VW deal.

    I know tax committee staff members at the General Assembly use a rule of thumb measurement – historically 9.5 to 9.6 percent of wages paid end up as state and local taxes. So the “ROI” to public funds committed would be at least $4.75 million annually.

    I also understand that Fairfax County resisted local tax incentives, such as a request to waive the personal property tax on VW employee vehicles.

  7. Anonymous Avatar
    Anonymous

    “The way to move forward is to get all the information on the table, hash out what works and phase that in.”

    Thank you. I agree.

  8. Anonymous Avatar
    Anonymous

    I beleive that using per capita income is a misleading number. The median household income would be a more accurate measure of wages. There are lots of children in Loudoun county that don’t have any earnings thus bringing down the per capita figure.

    Median household income in Loudoun is approx. 100k second in the nation to Fairfax among large counties. The quality of education and employment opportunities in Loudoun far exceed that of Southern VA including Roanoke.

    Cost of living is undoubtedly higher in Loudoun. Household wealth in Loudoun is also artificial because of the current housing bubble.

    Even so, I think it is flawed methodology that comes up with the conclusion Roanokers are 10.9% better off economically. Traditional standard of living metrics such as # of consumer goods per household, access to quality health care, and education will all favor Loudoun.

    If you want to make a quality of life arguement about dealing with less trafic etc. then you may have some valid points but from a purely economic standpoint Loudoun is going to trounce Southern VA.

    As for taxes I agree that Northern VA pays more than its share of state taxes and its needs are not met by the state government.

  9. Larry Gross Avatar
    Larry Gross

    re: …” I suggest we have more places like Roanoke”

    if you like Roanoke.. you’ll love Petersburg, WVa or Podunk, Ohio, etc.

    only trouble is.. VW has no interest in any of those locations, nor do 99% of the other companies that would choose NoVa over Podunk, Ohio.

    every time I hear the “more places” mantra… and especially from those who fret about the Goverment “restricting” them… I have to wonder … about just exactly how.. say Fairfax and the State of Va would “sell” this idea to .. say a company like VW.

    How about we start telling people that want to live in Spotsylvania that it would be better.. if they did not and to think long and hard about getting their butts down to Roanoke…where VW has been also directed to go….

    I have a proposal… let’s put a stake in the “more places” and drive it in so deep.. that we never hear the phrase again…

    🙂

  10. Anonymous Avatar
    Anonymous

    Since you are not listening anyway, you shouldn’t have to worry about hearing it.

    All I’m saying is that as long as we cram more stuff into the same places, the same places will continue to have more and more problems, and complexity means they will be harder and more expensive to fix.

    One place is as good as any other, or can be, so why is it, exactly, that VW wouldn’t find something charming about Roanoke?

    Anyway, aren’t you the one that said that government should not restrict anyone who is willing to pay the government costs associated with the growth requested. That is the argument I started with. Being restricted is one thing, being restricted with no alternative and no possibility of compromise is something else.

    Aren’t you the one that says Dominion needs to be incentivised to conservation? That’s the argument I started with, only i think the idea applies more universally. If the idea applied to me and others like me, you’d hear a lot less about how restricted we are, and a lot more about how environmentally productive we are.

    I don’t see why if it is OK to suggest that people not live in Spotsylvania that it is any different to suggest that VW not locate in Fairfax. But, since more than half of all the jurisdictions in the US have growth restrictions of one kind or another, it is getting awfully hard to even find a place to drive that stake.

    RH

  11. Groveton Avatar
    Groveton

    I question some of the numbers in Jim’s original post. I believe that he is using personal percapita income from 2005. I think that median household income from 2006 would be a much better measure for Loudoun County which has changed quite a bit in the last two years and has a lot of families with young unemployed children.

    However, there can be no question as to the difference in income level vs. income level viewed in light of cost of living. The cost of living calculation is crucial to understanding the real economic impacts of new taxes, intra-state subsidies, etc.

    For example, why should a person making $25,000 in Fairfax County get taxed at the same rate as a person making $25,000 in Roanoke County? They shouldn’t.

    Then, take the case of Prince Edward County. Per capita personal income of around $17,000 per year. How does the state encourage businesses to move there?

  12. Larry Gross Avatar
    Larry Gross

    re: ..”why is it, exactly, that VW wouldn’t find something charming about Roanoke?”

    it does not matter what VW’s reasons are. It IS, afterall THEIR business and they have the freedom to decide the when,where,how, etc of how to conduct their business – and we should be thankful that the government does not have the ability to tell them where they must go.

    As we speak, local candidates in the Fredericksburg Area are saying that they want to correct the “imbalance” jobs vs commuters in the area.

    So – Fredericksburg would love to have VW…and AOL.. and Belvoir/Quantico, etc, et al. They’ll take every single job that NoVa does not want….make a list.

    and I bet if by some completely bizarre implementation of the “more places” philosophy into actual Virginia policy that … if VW were told by the State that they could not locate in NoVa but.. COULD locate (their choice) in Roanoke or Fredericksburg – that .. they’d probably choose Fredericksburg.

    Why? I don’t know that answer ..

    but I suspect strongly that there is a reason – a business reason – and not serendipity related to their decision about where to locate – and the last thing in the world that you or I or anyone else should want – is the government dictating to business where they can and cannot locate geographically.

    That’s why I think we should drive a stake in the “more places” advocacy.

    It’s simply an unrealistic and utterly impractical approach to an area having “too many jobs” – which in and of itself – pray tell me – make a list of cities who have publically stated that they have a “too many jobs” problem?

  13. Larry Gross Avatar
    Larry Gross

    the problem is not that there are not enough places…

    look at the mindset behind that concept.

    what it boils down to is that there are “too many” people and “not enough” affordable housing and commuting infrastructure for those people – and the “solution” is to (with the appropriate PC-speak)… essentially make those people go away.

    So.. two questions:

    1. – do “other places” have a better process than NoVa of providing affordable housing and a better transportation grid for commuting or is the idea .. that those “other places” can figure it out?

    2. – this question is also aimed at EMR

    how many people for an urban area like NoVa is … Too Many?

    How far is NoVa already above that ideal level? 10,000, 100,000, a million?

    more to the point – given any urban/urbanizing area like NoVa or dozens of other American MSAs – give me a metric… of what would be the ideal density that would be “not too little”, “not too much” .. and juuuuusssttt right in the finest Little Red Riding Hood Traditions.

  14. Jim Bacon Avatar
    Jim Bacon

    Anonymous 2:09 p.m., Your point is well taken about the difference in “per capita income” and “median household income.” If I’d used the latter number, Loudoun County would have compared more favorably to Roanoke County. But that’s missing the larger point…

    My larger point is not that Roanoke County has a higher standard of living than Loudoun — which is now being touted as having the highest income in the *countr* — it’s that the gap between the two shrinks dramatically when you adjust for the cost of living differential. So, substitute your own metric, then adjust for the cost of living differential. The gulf between the two is not as large as when you started. But Uncle Same is taxing Loudounites as if the income gap were real…. And the quickest way to improve living standards in Northern Virginia is not to increase incomes even more, pushing up-hill against progressive federal income taxes, but to lower the cost of living.

  15. Larry Gross Avatar
    Larry Gross

    …. “Roanoke County has a higher standard of living than Loudoun”

    I dunno about that.

    all things being equal – is the 600lb gorilla.. simply the price of housing?

    What is median price of equivalent homes in NoVa and Roanoke.. and how does that play into the differences?

    But couldn’t the same comparison be drawn to hundreds of Roanoke-sized “places” in Southern Ohio, Iowa, Kentucky, etc… but what would that prove besides the obvious that VW would not likely locate at any of those “places”?

    Having said that – I DO acknowledge that at the STATE level – they can involve themselves in attracting certain kinds of businesses to areas the state would like to see have more businesses.

  16. Anonymous Avatar
    Anonymous

    “It IS, afterall THEIR business and they have the freedom to decide the when,where,how, etc of how to conduct their business – and we should be thankful that the government does not have the ability to tell them where they must go.”

    Well, gee Larry, my farm is my business too. I would be thankful if the government didn’t have the ability to tell me where to go. I fail to see the difference between government being able to tell business where to go, by offering incentives or disincentives, and doing the same thing for housing.

    Anonymous inthe Post above says we are proffering the wrong things. I think he is right.

    RH

  17. Anonymous Avatar
    Anonymous

    “what it boils down to is that there are “too many” people and “not enough” affordable housing and commuting infrastructure for those people – and the “solution” is to (with the appropriate PC-speak)… essentially make those people go away.”

    Isn’t it the same thing? You cannot create the commuting infrastructure because you don’t thave the land or it is too expensive. You wouldn’t need the commuting infrastructure if you had the appropriate mix of jobs. Even if you managed to createenough affordable housing, you might not have enough space to give them housing of the type they wish.

    This comes down to space, If you don’t have enough space then you need to find a new place where there is space.

    I still think Jim should go back and figure in the per capita or household property assessments. Then you would get an idea of how much income is earned and how much wealth is created and retained. That might change the assessment of cost of living.

  18. Anonymous Avatar
    Anonymous

    “It’s simply an unrealistic and utterly impractical approach to an area having “too many jobs” – which in and of itself – pray tell me – make a list of cities who have publically stated that they have a “too many jobs” problem?”

    It is certainly not that there are too many jobs. It is that the government has permitted too many jobs without providing or requireing the employers to provide sufficient transportation to supply those jobs with warm bodies every morning. It is too many jobs in too little space. Even EMR says Arlington has too many jobs for the location.

    It is a gross failure in government planning. It is Fairfax exporting its housing and transportation costs.

    If you took 50,000 jobs and mved them to Spotsylvania, how many cars would that take off of 95? How many cars would drive less distance to work?

    RH

  19. Anonymous Avatar
    Anonymous

    What is median price of equivalent homes in NoVa and Roanoke.. and how does that play into the differences?

    It is more than the price. It is the rate of climb. The question is how much does it cost to live, vs how much you get to retain as wealth.

    If it costs me $25,000 more to live in NOVA, but at the end of the year I have $25,000 more in home equity, then the actual cost of living is equal, but I’m still better off in NOVA.

    RH

  20. Anonymous Avatar
    Anonymous

    how many people for an urban area like NoVa is … Too Many?

    I think this is an incomplete question. We should ask something like what is the optimum mix of population per square mile, jobs per square mile, and street lanes (and other transport) per square mile.

    We should be able to figure this out pretty easily. Pick out a handful of places that seem to work: use the various published lists of best places to live. Then get google maps and figure out waht the range of variables is for those places.

    Pick out a few places notorious for congestion, and do the same.

    I’d be surprised if you didn’t find out thare are ratios that work and ratios that don’t. You might even find out that there are urban densities that work and some that don’t.

    RH

  21. Anonymous Avatar
    Anonymous

    Here is the latest argument in favor of “More Places”.

    According to the latest traffic congestion study, Atlanta actually saw a reduction in congested hours per person. Yearly congestion in the Georgia metropolis dropped from a revised 73 hours to 60 hours between 2000 and 2005. While Lomax said that drop was partly due to increased service patrols, experts caution that the figures are likely due to the expanding geography of the region into more rural areas and a rapid growth in population, both of which would water down per-capita averages.

  22. Larry Gross Avatar
    Larry Gross

    re: “It is that the government has permitted too many jobs without providing or requireing the employers to provide sufficient transportation to supply those jobs with warm bodies every morning.”

    Lordy, lordy. Do you mean those irresponsible governments that did not collect enough PROFFERS to help pay for the infrastructure that would be needed?

    So… NoVa could be fine.. is they had actually built the required infrastructure?

    Does that mean that even more folks could live/work in NoVa … IF.. IF.. they changed their ways and insured that enough infrastructure was built to support whatever level of jobs/people could sqeeze in?

    Question: Is NoVa unique with respect to the jobs/people/infrastructure condundrum?

    Bonus Question: Would Roanoke and/or Spotsylvania end up any differently given the same circumstances?

    Super Dooper Bonus Question:

    Should Roanoke and Spotsylvania send some of their taxes to NoVa to pay for their needed infrastructure?

    Spotsylvania.. especially. I mean, after all.. all those folks who live in Spotsylvania and work in NoVa; by all rights we should be taking those Spotsylvania taxes and sending them to NoVa – right?

  23. Anonymous Avatar
    Anonymous

    Larry, you are the one who said we can’t build new roads because the land is too expensive. I would submit that, no, we cannot cram more people and jobs into Fairfax, regardless of the infrastructure. I think it is already outside the norms for the ratio of jobs to homes to available streets.

    The only workable way to stop wasting millions of gallons of gasoline and fouling the air for nothing is to get those (excess)jobs out of there.

    Fairfax would be fine if they HAD built the infrastructure or limited the growth to the infrastructure they could reasonably afford, but now it is too late. The ROI for building new infrastructure is too low, because the costs are so high. It isn’t worth doing.

    Those that promote commuter taxes would love to see Spotsy pay for Fairfax infrastructure. I don;t think that is the way to go for two reasons: It is the jobs in Fairfax that are the attractive nuisance which caused the most serious periodic congestion. Therefor it is their problem to figure out how to provide services for all the jobs they permitted. Secondly, such a plan would be taxation without representation.

    That still leaves the problem of how you get from Spotsy to the Fairfax line.

    ————————-

    Having said all that, lets go back to your comment about car pools. Suppose that we legalize jitney’s, over the objection of cab drivers. That probably won’t be enough, you gotta incentivse people to conserve.

    Now suppose that government took on the job of managing scheduling and operating them, and paid people to ride them. Suppose you got the service running well enough that you could call up the Jitney Administration, and be scheduled for a regular ride the next day. And suppose they had enough of them so that you were not pinned to that schedule: you could flex one way or another in half hour increments.

    How many Jitneys would it take to make traffic relatively free flowing, and meet the requirements above? We can take a hint by considering summer vacation or holidays.

    Metro carries 800,000 passengers per day, but it also caused congestion problems of its own. And that is about 6%. For a guess, we would need twice that capacity in Jitneys, 1,600,000, to free up the congestion. If you could get a load ratio of 50%, you would be working a miracle, so you need 200,000 government operated vehicles, working at peak capacity for three hours twice a day, at a cost of $50 per hour.

    All it costs is $10 million a day. It will save 91 million gallons of fuel and $1094 per year in delays for each rush hour passenger.

    Anyone care to figure the ROI?

    RH

    If the figures above are anywhere close, the return is $10 million a day, or an ROI of 100%. If the figures are off by a factor of ten, the ROI is still 10%.

    All we gotta do is find the $10 million a day we are presently wasting.

  24. Darrell -- Chesapeake Avatar
    Darrell — Chesapeake

    “This comes down to space, If you don’t have enough space then you need to find a new place where there is space.”

    Back in the late 80s, that was called Seattle, Portland and Phoenix. Followed in the 90s by Vegas and Salt Lake City. Today it takes a box of MREs and a full tank of gas to get across those towns. They ran out of space.

    There are tons of places that have space. Cleveland, Buffalo, and uh Detroit come immediately to mind. Then why is everyone leaving there to come here? So they can live the good life in overpriced condos along some trolley line?

    When businesses get taxed out of their current location, they go looking for the best deal. Someone gives them money, land, and a tax break, and it’s hasta la vista baby.

    People left with no jobs at home pack up their covered wagons and head across the prairie, looking for the next boom town. And the cycle begins another round.

  25. Anonymous Avatar
    Anonymous

    Darryl, I think you are exactly right.

    Recently I was tlking to a local businessman who was swamped with repair business. “What I ought to do is raise my rates, but I can;t bring myself to do it.”

    I put an ad in the paper for hay, and got fifty calls. Obviously, the price was too low. So, if you are swamped, raise the price.

    Obviously, if the glut of business in Fairfax is causing the waste of 97 million in wasted fuel and $1097 in wasted time per person a year, then they are not taxing their businesses enough.

    Larry is all of favor of congestion pricing, why not congestion pricing for business? Just don’t go too far, so you wind up like Detroit.

    Cleveland still rocks.

    RH

  26. Darrell -- Chesapeake Avatar
    Darrell — Chesapeake

    I remember the Cleveland of the 60s. Saw the Beatles down at the stadium. WIXY – 1260 was THE station to listen to. But then things went down hill. My mother used to live just across the flats from Jake and the Terminal tower. A perfect view of downtown from a floundering neighborhood.

    When she had to move in with me because of medical problems, I sold that house to the authority because there wasn’t enough money to fix it up and also pay the med bills. I really felt bad because my sale triggered the condemnation of several other homes there so the city could build an upscale apartment building. A lot of elderly, lifelong friends of my mother got sent packing. I’ve heard the new vision for that neighborhood hasn’t worked out too well what with everyone leaving.

    Nova and Tidewater can very easily become the next Cleveland if the politicians aren’t careful. Rust can form just about anywhere.

  27. Anonymous Avatar
    Anonymous

    Darryl:

    That is an excellent comment. Thank you for the personal perspective.

    My previous comment was shaded by the time I took an ultra discount flight, on short notice, to Cleveland, to hear the Cleveland Symphony.

    It turned out I could fly to Cleveland and enjoy the concert in less time and less cost than I could go to the Kennedy Center.

    At the end of the day, the idea is to get the most grins per buck. When government wakes up to that idea, maybe we have a chance.

    RH

  28. Larry Gross Avatar
    Larry Gross

    do you guys REALLY think the reason that Detroit and Cleveland went downhill was because of taxes?

    How about Asian Automobiles, electronics and textiles?

    How about Martinsville and other towns in Va that went downhill?

    Do you think it was because Martinsville ran those businesses out of town from high taxes?

    not quite that simple. Martinsville could have NO taxes on textiles and furniture and those companies would still leave… right?

    New York city.. you know the place that actually does charges businesses (as Ray and others advocate)… well these same advocates .. hammer NYC for chasing businesses out… with taxes

    so which is it guys?

    see .. here’s a clue… You can charge the employees for whatever is needed AFTER you promise the company a better tax/subsidy deal than a competing city….and the company locates there.

    but if that company is looking for cheap(er) labor… and their choice is Cleveland, Detroit, Martinsville and some village on the coastline of China… Detroit, Cleveland, Martinsville (and their respective tax policies) are …. irrelevant.

    thoughts?

  29. Jim Bacon Avatar
    Jim Bacon

    Larry, I disagree. Taxes are very important. Taxes may be only one of several critical factors, but they are one. The question to ask yourself: Why has Detroit failed to reinvent itself? Another question: While NYC has fared well, thanks to its world-class financial services cluster, what have high taxes done to every other metro regin in New York state? One more question: Everybody points to Mississippi… They’re low tax, but I wouldn’t want to be like them. Compare Mississippi’s economic growth rate to any other state’s over the past 30 years.

    I’ll be dealing with the issues in a forthcoming edition of the Economy 4.0 series. But those are some questions to chew on until then.

  30. Larry Gross Avatar
    Larry Gross

    JAB – Oh … I agree that taxes ARE important competitively with respect to states but also with respect to nations.

    we keep thinking sometimes that Detroit is competing with say NYC or NoVa or even auto plants in Alabama and yes even Mississippi but at the end of the day…the reason Toyota and Hundai (sp?) did NOT build in Michigan …probably was not due to taxes but labor costs AND … benefits including health care.

    Moving Detroit to Mississippi or even Virginia or other low-tax states won’t save Ford… note the F-150 plant in HR/TW recently went away… and we’d probably agree that they did not flee… onerous taxes…

    I just think we need to keep things in perspective… Virginia IS a low tax state … compared to many states.. but that is only ONE factor in a company’s decision to be in Virginia.

    so a question – do you think that the leaders in HR/TW would JUMP at the chance to get a Toyota or Kia plant to replace that Ford Plant?

    Should the State itself…”sweeten” the pot if push came to shove …?

    some might say that in Va… compared to other states.. that we are getting close to the blood from a turnip stage… (though not me)…

  31. Darrell -- Chesapeake Avatar
    Darrell — Chesapeake

    Actually Toyota did check out TW back in 2006. They decided to build a 2 billion dollar plant in Mississippi. That state offered 295 million dollars. The south is the quickly becoming the auto plant capital of America. Makes sense. The services companies are over in Mexico. Ford closed Norfolk, and opened a new plant in Mexico.

    Now, I’m not saying that taxes are the only cause of relocating business. But when it comes to interstate domestic relocations, it is a big cause.

    Trying to equate that with the policy of globalization is apples and oranges. Read what policy wonks like Louis Sohn or Zibignew Brezinski have to say about globalization. Those trade policies are geared toward eliminating poverty and supposedly enhancing world peace and democracy. Some would argue that such transfers of wealth are destroying our nation, and we could debate that ad infinum. But that is a topic better reserved for another day.

    The key point in measuring prosperous success deals more with developing business that will value add to this nation’s globalization policies. Innovation, rather than maintaining the status quo, is the key. Local development agencies by and large fail to seek out innovators, prefering to steal existing businesses from other communities.

    Just one example is ODU’s failed Maglev project. When it didn’t work, no one was willing to fund or explore the project further. Well, except for one professor who carried on using scraps of wire and metal leftovers to solve some of the problems.

    History is full of tinkerers who brought forth inventions that changed the world. In this age of certifications and degrees, rules, regulations and job descriptions, the tinkerer is an endangered species.

  32. Anonymous Avatar
    Anonymous

    “all those folks who live in Spotsylvania and work in NoVa; by all rights we should be taking those Spotsylvania taxes and sending them to NoVa “

    That’s what the folks who are in favor of commuter taxes, such as those proposed in DC and enacted in Cincinatti. My response would be no, for two reasons. The first reason is that it is the jobs that are the attractive nuisance. You could put up a fence around Spotsy and just say “No, you are not allowed to take a job in NOVA”. But if you did that, FAIRFAX would still have a problem because they would still have too many jobs to be served by the transport available. Fairfax has the jobs, Fairfax has the money, Fairfax has exported its housing problems, and Fairfax would still have a problem, with or without Spotsy residents.

    The second reason is that it would be taxation without representation. My father was mayor of a small town outside of Cincinatti: he and other mayors fought the Cincinatti commuter tax on that basis.

    “Economic success that’s only narrowly shared will divide a nation ultimately and kill the entrepreneurial spirit and opportunity to pursue happiness.”

    Mitt Romney, speaking at the Detroit Economic Club.

    One of the things that Detroit has done is to increase the rate at which abandoned buildings are condemned and torn down. On result of this is increased open space in the city, and this has contributed to some renewed intrerest in living in the urban areas.

    RH

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