Wow - long time no write!
I was listening to my favorite radio program today, Fresh Air, on NPR. Terry Gross was interviewing David Cay Johnston, author of Free Lunch: How the Wealthiest Americans Enrich Themselves at Government Expense (and Stick You with the Bill). Fascinating. I only heard bits and pieces, but what I heard was enough to make me sick.
I first heard him talking about how big-box stores like Wal-Mart and Cabela's build in certain areas because of big tax breaks offered by the city. No big surprise, I knew that already. But I didn't know that a lot of times the deals involve the store keeping the sales tax paid by its customers. WhatWhatWhat? That's right. When you go to the fantastic Wally World, the amount you pay in sales tax stays right there at the store. It doesn't go, as previously thought, to support your schools, police force, firefighters, or road improvements. It goes to line the pockets of the Waltons. Nice!
I then heard him speak about how Dubya got rich by the building of a new stadium for the Texas Rangers. Yes, because of a baseball team, not oil, or the stock market. Apparently he was 2% owner of the team, and fronted $650K to get the stadium built. The city of Arlington, Texas passed a bill to add a 1/2 cent sales tax increase in order to build the stadium. It's good for the city, right? It'll bring in new business! Believe me, we here in St. Louis know all about new stadiums and all the hoopla that goes on to get them built. Anyway, the stadium cost $191 million (mind boggling, I know) - $135 million came from the sales tax hike, and $56 million from the owners. I don't know the specifics, but after it was built, the owners were allowed to buy it for a fraction of the cost. They then sold it for a big profit, and somehow or another Dubya ended up getting 10% of the profits, a cool $17 million. Quite a return on a $650K investment! I suppose one could say the people of Arlington helped make Dubya quite a fortune (and I'm sure a few select others).
To add insult to injury, that $17 million should have been reported as income on his tax return, (I don't know the particulars - I'm not a tax accountant), but was instead reported as capital gains - assessing a 15% tax instead of whatever his normal tax bracket was. Wow. Must be nice. I know many people abuse the tax system, but many people don't go on to become our fearless leader.
Man, this stuff blows my mind. I know it's perfectly legal. I get it. But it frustrates me that big-box companies go into small towns and put small, hometown companies out of business, all the while collecting our sales taxes. It's disgusting. It further enforces my decision to buy local whenever possible.