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The woes of Wyoming have attracted considerable attention of late, most recently in an article in the business section of yesterday's Post.
While other states in the Mountain West, like Colorado and Utah, have grown and prospered during this decade, Wyoming's small population is stagnant. Wages are often low, living costs are high, and many talented young people depart for better opportunities elsewhere.
Back in 1993, before this boom got up a full head of steam, I drove up to Cheyenne and talked to Mike Sullivan, who was then governor of Wyoming. Getting the appointment was easy, after I did some name-dropping -- my mother, who grew up in Douglas, Wyo., had been Sullivan's baby-sitter when she was a teen-ager.
Sullivan had many of the same economic concerns as the current governor, Jim Gehringer: Wyoming was a source of cheap commodities -- trona, coal, calves -- and should be looking at ways to add value in Wyoming, rather than ship the raw materials out to the better-paying processing jobs.
For example, the coal that goes for $3.50 a ton at the strip mine in Wyoming is $35 a ton at a Texas power plant, and even more once it becomes kilowatts. The calf that fetches 50 cents a pound in Wyoming becomes $8-a-pound T-bone steak after leaving the state.
Now, there are doubtless many Wyomingites who like it this way -- if dollars come hard and daily life requires perseverance, then the mocha-latte cell-phone sport-utility-vehicle crowd will invade other provinces, and Wyoming will retain its spacious grandeur.
Others may not like it this way, but, if they're like the Gilette breakfast crowd quoted in Monday's Post, they're suspicious of government's ability to effect changes.
Such suspicions are well-founded. While we were in Puerto Rico earlier this month, the San Juan Star, the local English-language daily, carried many stories about American Airlines.
A few years ago, AA promised to make San Juan its Caribbean hub if Puerto Rico cooperated with some tax breaks, airport expansion and the like. But AA had a change of heart and now planned to move the hub to Miami, with several hundred jobs migrating to Florida. Puerto Rico, in short, would get stuck paying for the bigger airport, while the promised jobs moved elsewhere.
This in itself should qualify Puerto Rico for statehood -- its officials are just as accommodating as those in a 122-year-old state like Colorado.
In 1992, our legislature passed a bill exempting certain
railroad equipment purchases from the sales tax. The idea
was to keep jobs in Colorado. Otherwise, the Colorado shops
of the Denver & Rio Grande Western, then merging into
the Southern Pacific, might move to some state which didn't
take equal justice under the law
as seriously as
Colorado.
Well, those jobs are going anyway. The railroads were required to file reports with the state, concerning employment and payroll -- but nothing about how much sales tax they had evaded.
In other words, there's no way to examine this corporate
subsidy program, and say we lost $300,000 in sales-tax
revenue from the Burlington Northern in 1995, but in return
we kept 1,413 Coloradans on the job with an average annual
pay of $42,310.
So nobody knows what kind of return the taxpayers of Colorado are getting for this economic development program, since nobody knows what it costs.
On a local level, Wal-Mart last year opened a superstore on the west side of Salida. Utility lines had to be extended at a cost of about $300,000, and Wal-Mart, like other water customers requiring water-line extensions, was supposed to pay the full cost.
But little of this agreement was in writing, and some of the $300,000 was apparently to be repaid through the increased sales taxes generated by a bigger store.
I don't think I'd get very far if I opened a business that needed a sales-tax license, went down to our city hall, and asked if the sales tax I paid could be applied against my water bill.
A further complication with these tax breaks lies in
current Republican ideology. Any attempt to make the tax
rates the same for everybody -- that is, simple fairness
and equity -- is portrayed as a horrible tax
increase,
even though the taxes for most of us would be
lower if everybody paid a fair share.
It seems obvious that taxes are too high if any government at any level has surplus money for subsidizing Nike, the Union Pacific Railroad, Wal-Mart or any other private enterprise.
Stopping this is probably impossible. But I hope that
Wyoming will at least set up cost-benefit accounting, so
that its taxpayers know what they're getting for their
expenditures on economic development.
What Wyoming
could learn would be quite instructive for the rest of
us.
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