No such thing as free lunch
Paul Gessing is president of New Mexico’s Rio Grande Foundation, which promotes limited government, economic freedom and individual responsibility.
Here’s his take on state subsidies:
It is easy to get caught up in the minutiae when it comes to economic policy. With the state facing a $400 million deficit and budget cuts in the offing, every special interest is busy coming up with their economic analyses explaining why subsidies or regulations that serve their interest will benefit the public at large.
The fact is that more often than not, simple logic is more useful than complex economic studies that are ultimately designed to justify a predetermined policy.
This logic can be best summarized as “There is no such thing as a free lunch.” Specifically, I’m referring to the fact that government’s taxing one citizen’s hard-earned money and transferring it to another, preferred group, does not increase our economic prosperity.
Advocates for continued subsidies for New Mexico’s film industry have flatly refused to accept this reality. Advocates for the film industry which receives a 25-percent rebate on all spending done in the state would have us believe otherwise.
According to them, we need to keep pouring tax money into the industry lest it pick up and move to another state that offers even more generous incentives. This makes no sense whatsoever. Taking money from New Mexico taxpayers at large and giving it to one particular industry is not sound economic policy. While many industries and various groups receive exemptions in the tax code, no other industry actually receives tax revenue out of the pockets of hard-working New Mexicans.