The answer is: Wassily Leontief.
Oh, Im sorry. You want to know the question.
Here it is: Who is responsible for Charlotte sticking it to Atlanta and getting the checkered flag to build the NASCAR Hall of Fame?
As I said, the answer is Leontief (1906-1999). The Nobel Prize-winning economist fled the Bolsheviks. Yet his theories, embraced by both capitalists and socialists, are said to be an expression of Marxian economics.
Thats fitting. The NASCAR museum is best described as socialism for billionaires. Two billionaires, to be precise: NASCAR owners Bill France Jr. and James France.
Georgias economic development boosters initially (and very secretly) agreed to pony up $32 million in public (your) money for a $92 million NASCAR museum. But Atlantas economic development guys were out-cashed by North Carolina, which offered $122.5 million in public funds toward a $137.5 million museum in Charlotte.
So, the bidness goobers at Central Atlanta Progress leaned on Mayor Shirley Franklin, who sullying her reputation as a prudent manager upped the citys proposed tribute to the France family from $5 million to $77 million. State officials tossed $25 million onto the NASCAR roulette wheel and would have thrown in a whole lot more if the good Christians in the Republican Party could have found a way to divert the money from Atlantas homeless programs. Too bad theres nowhere near that amount of cash in all of the programs for the homeless.
Whats pretty obvious is that the France familys plan was always Charlotte. Ninety percent of NASCARs drivers live within 60 miles of the burg. Four other cities were just Potemkin props used to scare North Carolina officials into pillaging their constituents wallets.
It helps to crunch the big numbers into more personal-sized expenditures. Georgias state poo-bahs wanted to take about $3.60 from every citizen man, woman and toddler and give it to the NASCAR Hall of Fame.
North Carolina, more supportive of the obviously needy France clan, will pluck $14.24 from each citizen.
But its Franklin who earns the pole position in the profligate spending race. Her package included gate fees at the museum. It also would have allowed NASCAR to skip paying property taxes. Corporate sponsorships were slated for another portion although no names of generous corporations were included in the proposals.
Should the NASCAR museum crash and burn, would the France family be on the hook? No way. The debt would belong to Atlanta taxpayers. Worst case: Franklin was promising as much as $182.03 for each resident.
That Shirleys such a sport!
Oh, and did I mention that neither the city nor the state can find a farthing for the Atlanta Symphony Orchestras proposed $300 million concert hall, a world-class cultural statement that truly would be a boon to the community? Private donors, led by Falcons owner Arthur Blank, already have chipped in $100 million but do you think Atlanta and Georgia officials could ante up some change? How about a little creative taxation, a la NASCAR? Nope, the ATL doesnt do highbrow.
NASCARs two France clan elders, meanwhile, are each worth $1.6 billion, and tie for No. 198 on the Forbes list of the 400 richest Americans.
Thus, Karl Marxs dictum of From each according to his ability, to each according to his need takes on an innovative interpretation. All of us clearly have the ability to chip in a few dollars for the France kinfolk, although the Frances seemed to want the money more than they needed it.
The NASCAR scam isnt new to the South. Its a variation on the economic development strategies that have left ghost towns, empty factories and depleted public treasuries throughout the region. Sports team owners, bandit corporations looking for cheap labor and, now, NASCAR, demand ransoms to locate in a state. Then they leave after theyve exhausted the giveaways.
Last month, Georgia appeared to be leading in a bidding war among Southeastern states to land a Kia plant. The states visionary leaders are willing to pay the Korean automaker at least $200 million to build a plant that would employ, maybe (but no guarantees) 2,500 people.
For those still living in reality, Georgia officials want every resident to chip in about $22.65 to Kia which had profits last year topping $700 million.
Isnt America great?
So, lets get back to Wassily Leontief, whose big claim to fame was his input-output theory, which argued that money invested in certain projects miraculously grows under certain conditions.
His ol in-and-out, as interpreted by civic boosters, has screwed millions and millions of people.
For example, every time a billionaire sports-team owner wants a city to cough up a half-billion bucks, he threatens to leave town unless he gets his new palace. City leaders immediately proclaim the stadium will have bundles of economic impact.
Part of that impact, or output, is direct. You can measure it. Construction costs can be tallied. People will buy tickets, hot dogs and doo-dads, and most of that money will go, in NASCARs case, to the Frances, with a pittance left over for a few score, mostly low-level employees.
The rest of the output comes by multiplying the direct impact. According to leaders such as Georgia House Speaker Glenn Richardson, the NASCAR museum would have generated an economic impact of $1.5 billion over 10 years.
The clue to the scheme is that Richardson effused that direct spending at the museum during a decade would be about $519 million. To amass the $519 million number, the estimated 1 million visitors a year for 10 years to the museum (a highly optimistic projection) would have to spend $52 apiece.
The input-output voodoo somehow would have added another $100 to that $52 in real money.
It never happens, says University of South Florida economist Phil Porter. If the multiplier is two, then if you took away half of the alleged impact, you would have had zero economy to begin with. It doesnt make sense.
Porter has analyzed numerous sports events, such as Super Bowls, and has concluded that they seldom bring measurable new dollars to a city. What they do is transfer money. If people spend money going to a Super Bowl (or racing museum), they wont spend it on restaurants, movies or nightclubs.
Its a little better with a museum than with something like a Super Bowl, Porter says. A big sports event displaces for a short time a lot of little local business, and Porters studies show scant added cash into the community, as measured by sales tax receipts.
A NASCAR museum is there year-round, so cumulatively, it will have some direct impact, Porter says. But it wont have any major impact on the communitys economy. Youd get more impact by investing dollars into schools, hiring teachers, policemen and firefighters.
Porter, of course, foolishly ignores the obvious: No billionaires are going to make additional fortunes from building schools.
Another billionaire figured into Atlantas bid. Bernie Marcus deserves accolades for spending more than $200 million of his own money building the Georgia Aquarium. But Marcus knows that attendance drops off precipitously after the first year or so of an aquariums life.
So, Marcus wanted Atlanta to foot the bill for NASCAR. The theory is that somewhere there are people who want to see whale sharks and Dale Earnhardts trophies. Uh, maybe. And the corollary is that the output of two venues of likely declining attendance will justify the input of your hard-earned cash.
As I said, Wassily Leontief.
Senior Editor John Sugg who once raced a 1960 VW in the Sand Crab Crawl in the Florida Keys can be reached at 404-614-1241. His blog is at www.johnsugg.com.