Wednesday, October 30, 2013

The Free Market In Action

Lawsuits have been filed in the Great Gaylord Giveaway.  Roll the tape:

The tit-for-tat legal action is something that economic-development officials have long feared — a public battle over incentives and future development.

In one corner are backers of the 1,500-room Gaylord, which in May 2012 received approval for an $81.4 million subsidy under the state's Regional Tourism Act. The hotel, near Denver International Airport, would create 10,000 construction and 2,500 permanent jobs and draw more than 450,000 outside visitors each year, backers say.

In the other corner are a group of hotels concerned that the Gaylord, with its massive public subsidies, will glut the market and cannibalize their business.
I, of course, hope the hotels prevail in their suit.  The Gaylord project has been a boondoggle from the beginning.  Not only has it been a testament to how scammy our nation's capitalists have become, but it's an ode to political ego. 

Aurora's mayor Steve Hogan desperately wants to say he brought jobs to the city, and he's willing to squander tens of millions of dollars of taxpayer money to do it.

I can think of nothing so useless as a big honking hotel in Aurora, the stinking asshole of this state, out by the airport. 

You're a business traveler, probably going to the tech center.  Here's a rental car, your room, and an hour long commute to the office

You're a tourist, come to see the wonders of Denver.  First thing you notice, once you land out in the prairie, is that the mountains are far, far away.  The city skyline is way off in the distance.  None of the things you are going to want to do will be near your hotel.  Sure, they may have a great buffet and a wonderful convention hall, but who gives a shit when everything in your Frommers book is a day-trip away.

Either way, business traveler or tourist, you're going to get a worse experience, and I'm gonna be paying for it

If there was a real desire, an economic need, to build a huge hotel like this out by the airport, an enterprising firm would seize it without delay.

In this case, no one but the Gaylord contingent wants this project.  They've run the numbers and discovered it's not economically feasible without the subsidies.  It will cost too much and may not result in a profit.

Getting the subsidies changes this uncomfortable fact not one bit.  It just means that the costs will be more distributed and the profits will be taken anyway.

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