Tag Archives: Sheldon Adelson

Profiles in Privilege

  1. When powerful politicians give no-bid construction contracts to their friends, you get Olympic bathrooms with two toilets to a stall. Thank god we don’t have those sorts of problems here in the West, right?
  2. Sheldon Adelson, owner of one of the largest (off-line) gambling ventures in the world, is really worried about on-line gambling. And, apparently, he “can sound surprisingly like a Southern Baptist preacher.” Bruce Yandle probably saw this coming.
  3. Remember that time when the D.C. City Council tried to side with the local taxi monopoly to keep out an innovative new competitor that was wildly popular with customers? Remember how Council members backed down after they were inundated with protests from angry constituents? Politicians in Pittsburgh, Chicago, Milwaukee, and Paris (France) don’t.
  4. In an effort to catch up with the private sector, the Obama Administration wants to move more government business from paper to the web. The paper industry is not a fan of this. In Bastiat’s telling, candlestick makers didn’t like competition from the sun either.
  5. Makers of maple syrup want more exacting grading standards for maple syrup. In other news, I would like a law saying that only economists who attended ASU and GMU can call themselves economists.
  6. Soccer star and aspiring (unproductive) entrepreneur David Beckham is trying to get a stadium built. He says “We don’t want public funding…We’ll fund the stadium ourselves. It’s something where we have worked hard to get this stage, to fund it ourselves.” In other reports, however, “Beckham’s group has hired prominent Tallahassee lobbyist Brian Ballard to help seek a state sales-tax subsidy similar to what other professional sports teams across Florida have received for building stadium facilities.”
  7. Elsewhere in privileged Floridian soccer news, the city of Orlando plans to use eminent domain to seize a church in order to tear it down and build a parking lot for Orlando’s new soccer stadium.
  8. WAMU’s Patrick Madden tweets that Mayor Vincent Gray has assured voters they will not be paying for soccer team D.C. United’s stadium….Voters will, however, pick up the cost of the land at $150,000,000 and then rent it back to the team for $1.00 per year. Sounds too crazy to be true? Read the terms here (to be fair, it looks to me like taxpayers will only be paying $140,000,000).
  9. Pat Garofalo writes: “In a move its protagonist, Vice President Frank Underwood, could be proud of, the studio that produces Netflix’s “House of Cards” is all but attempting to extort tax dollars out of the state of Maryland. As the Washington Post reported, Media Rights Capital has threatened to move production of its show about an absurdly corrupt Washington elsewhere if it doesn’t get a new slew of taxpayer money.”
  10. According to this report, FBI agents posed as film executives to bribe a California state senator to expand film tax credits. This sort of film subsidy corruption scandal will likely sound familiar to those in Iowa. And Massachusetts. And Louisiana. Makes you think that P.J. O’Rourke was right: “When buying and selling are controlled by legislation, the first things to be bought and sold are legislators.”

Nanny state could save Madrid from EuroVegas

Las Vegas real estate developer Sheldon Adelson selected Madrid as the site of his next proposed casino project, EuroVegas, last month. The project is estimated to create 250,000 jobs in a country with 25% unemployment. On the one hand, this project may look like a good bet for the city, bringing both short term construction jobs and hopefully creating a long-term tourist destination.

However, EuroVegas will not be financed completely with private investment. Instead, Adelson wants to pay only 35% of the projects construction costs, asking the city to finance the rest. Additionally, he requires that the project receive property and business (IAE) tax breaks. Since most of the investment will be taxpayer funded, the risk is borne largely by the public and the project requires Madrid taxpayers to take on even greater debt. The tax-exempt project will not contribute to the tax base for public services. Adelson selected Madrid as the EuroVegas site after receiving better breaks there than Barcelona policymakers offered.

Carlos Ruiz, a retired engineer, heads the group EuroVegas No. He sums up the feelings of some who feel that the project would benefit Adelson at the expense of Spanish taxpayers who already have a high debt burden:

“Citizens from the whole of Europe are lending money to Spanish banks because they are in a bad situation — hoping that someday these banks will start to give credit to small enterprises, to families, to people,” Ruiz says. “But this money is going to go to Mr. Adelson, who is one of the richest men in the world. This is quite unfair.”

Madrid officials seem poised to offer Adelson all of the concessions he seeks, including subsidies, tax breaks, and exemptions to labor laws, except for one. The sticking point in the deal may be that the project requires an exception to Spain’s nationwide ban on smoking in bars and restaurants to go forward. Prime Minister Mariano Rajoy said that lifting the smoking ban for EuroVegas would give the development unfair political privilege over all of the country’s other establishments where smoking is not permitted. He said he thought that making an exception to the ban for EuroVegas would be unconstitutional.

Whether or not EuroVegas will go forward in Madrid remains to be seen. Either way, Rajoy’s approach to a level playing field is worth noting here. As Matthew Mitchell explains in his paper “The Pathology of Privilege,” creating special advantages for projects like EuroVegas tends to benefit well-connected people at the expense of the general interest and limits economic growth as resources are directed according to political favor rather than by the market.