Give free and open market a try

May Cedar Rapids have a prosperous New Year. This trite annual wish could actually be the start of something big, something very new indeed. The creative key to real prosperity is in the details; What are the pathways to prosperity that we will choose?

At present economic development is pursued on a predictable politicized playing field; Each year, the State of Iowa grants hundreds of millions of dollars in outright grants and tax incentive packages to just a few dozen companies with political connections. Thousands of other Iowa companies and hundreds of start-ups invest their own money, dedicate untold hours and lay down their own blood, sweat and tears on the line.

Government intervention in private enterprise is a limited path to prosperity where we politically influence the winners and losers in the game of enterprise. What would happen in a truly free and unfettered market? We do not know, because even with all the talk from politicians about 'Free Enterprise”, we have not experienced what a truly free market looks like.

At present we have an economy that operates with a stacked deck of subsidies, grants and tax incentives for the elite few, while the many pick up the tax tab. We have state socialism for the few that can garner corporate welfare and raw capitalism for the average jane and joe trying to make a go. The largest companies often do not pay out much in taxes, indeed, many pull out more from state coffers than they pay in. Last year John Deere received $11.9 million and Cedar Rapids-based Rockwell Collins and its subsidiaries got $13.8 million in state incentives.

In Cedar Rapids, Mayor Ron Corbett's pronouncement that Cedar Rapids is 'open for business” really means that our public city treasury cash drawer is open to an elite few politically connected players. Big real estate developers in town argue they cannot build a new project without massive tax advantages and other special treatment at city hall. At the same time hundreds of smaller developers and contractors in town shoulder their own taxes and pay their own expenses. A Cedar Rapids skyline built with an innovative and competitive open market would take on a much more creative, varied and innovative aesthetic. At present we see a lot of the same basic box design cranked out by the same few architects, developers and contractors with influence at city hall.

Any discussion of free enterprise is speculation, as we have always had the elite few translate their political influence into extreme economic advantage. We have not arrived at an economic structure where 1 tenth of 1 percent control the economy and siphon up the massive majority of wealth by accident. The stacked deck, the fixed economy is the result of long term political policy at the City, State and Federal level. Political intervention and subsidies for a few actually stifles innovation as it gives false advantage to the politically connected and anchors in the status quo. We would be all be amazed at the prosperity and creativity that would emerge and grow here if our State and City had the courage to actually operate within a free and open market.

' Michael Richards is an entrepreneur and community activist who has lived in the Corridor for 20 years. Comments: soyawax@aol.com