- The Washington Times - Wednesday, January 22, 2003

To hear sports columnist Thomas Boswell tell it, economist Milton Friedman, a Nobel laureate, got it all wrong. Mr. Friedman, who has been studying economics for nearly three-quarters of a century, has famously quipped: "There is no such thing as a free lunch." In his Friday column in The Washington Post, however, Mr. Boswell essentially claims to have found the very free lunch that has eluded Mr. Friedman for decades.

Mr. Boswell waxes enthusiastically about how the financially strapped District can rather easily underwrite a substantial portion of the costs of a state-of-the-art ballpark to entice the Montreal baseball franchise to the nation's capital. Depending upon its location, the ballpark could cost nearly $550 million and, in other cities, the public has generally borne 50 percent to 75 percent of the cost, Mr. Boswell says. Never mind that underneath Mr. Boswell's own nose, Redskins owner Jack Kent Cooke and Wizards/Capitals owner Abe Pollin built their sports palaces with their own money, accepting only infrastructure improvements that were appropriately financed with public funds.

The only taxes that would need to be raised, Mr. Boswell says, are those "taxes related to baseball, which would not exist unless baseball came to town." (We could not have said it better.)

In addition, he clearly hasn't the foggiest idea of the concept of opportunity cost. As Mr. Friedman would be happy to explain, the opportunity cost of those new taxes is the next-highest-valued alternative use to which the new taxes could be put. Raising taxes to build a ballpark would preclude the use of those funds for anything else.

"You wouldn't believe the range of ways that cities have invented to pay ballpark loans," he gushes, implying that naming rights, the taxation of ballplayers' salaries and other ballpark-related measures can foot the bill. This is disingenuous in the extreme. A cursory review of the public financing mechanisms (www.ballparks.com) used by government agencies elsewhere reveals: (1) Taxes on cigarettes and alcohol provide the public subsidies ($84 million) to build Cleveland's ballpark; (2) a one-half cent sales tax increase in Arlington, Texas, will provide $135 million in public subsidies for the Texas Rangers' ballpark; (3) other sales-tax increases funded subsidies for ballparks in Phoenix ($238 million), Seattle ($340 million), Denver ($168 million), Cincinnati ($544 million for baseball and football complexes) and Milwaukee ($310 million); (4) rental-car and/or hotel taxes were increased to subsidize ballparks in Detroit ($115 million), Chicago ($167 million), Seattle and Houston ($180 million).

Unfortunately, the free lunch Mr. Boswell envisions comes with a hefty price tag for the public.


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