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Something has gone terribly wrong within the band of professional sports hucksters lobbying for public money. One of them is telling the truth. The Seattle Sonics professional basketball team wants to leave its longtime home -- which is balking at giving the team a big subsidy -- and relocate to Oklahoma City. Seattle has gone to court, saying the departure would hurt the local economy. Replied the Sonics,"There will be no net economic loss if the Sonics leave Seattle. Entertainment dollars not spent on the Sonics will be spent on Seattle's many other sports and entertainment options." This is the substitution effect that economists opposing stadium subsidies have long argued. A new stadium only redistributes spending within a city; it brings in very little if any money from the outside. Rodney Fort, former Washington State sports economist now at the University of Michigan, commented wryly, "When the Sonics are trying to get the public to pitch in on a new arena, they are worth tens of millions to the Seattle area," but when the team wants to vamoose, "they are worth nothing to the Seattle area." Next event: the University of Washington wants taxpayers to pay for half of a $300 million stadium renovation for its Huskies. The university claims that Husky sports bring $211 million in sales taxes to the state -- very doubtful, because little money comes in from the outside. It's that substitution effect again
Something has gone terribly wrong within the band of professional sports hucksters lobbying for public money. One of them is telling the truth. The Seattle Sonics professional basketball team wants to leave its longtime home -- which is balking at giving the team a big subsidy -- and relocate to Oklahoma City. Seattle has gone to court, saying the departure would hurt the local economy. Replied the Sonics,"There will be no net economic loss if the Sonics leave Seattle. Entertainment dollars not spent on the Sonics will be spent on Seattle's many other sports and entertainment options." This is the substitution effect that economists opposing stadium subsidies have long argued. A new stadium only redistributes spending within a city; it brings in very little if any money from the outside. Rodney Fort, former Washington State sports economist now at the University of Michigan, commented wryly, "When the Sonics are trying to get the public to pitch in on a new arena, they are worth tens of millions to the Seattle area," but when the team wants to vamoose, "they are worth nothing to the Seattle area." Next event: the University of Washington wants taxpayers to pay for half of a $300 million stadium renovation for its Huskies. The university claims that Husky sports bring $211 million in sales taxes to the state -- very doubtful, because little money comes in from the outside. It's that substitution effect again