Comment 56430

By A Smith (anonymous) | Posted January 14, 2011 at 20:06:25

goin'downtown >> There must be a balance created for quality of life when it comes to government spending on cultural/recreational activities/facilities.

According to the 2009 financial report...

http://www.hamilton.ca/NR/rdonlyres/5D8DCD38-518C-4F51-83FC-06AFD2A83967/0/2009FinancialReport_rev8202010.pdf (page 6 of 64)

we see that city spending on culture and recreation has increased from $91.6M to $132.6M over the 2005-09 time period. That works out to an average annual increase of 9.7%. In that same period of time, Ontario workers wages/salaries/other income has gone up an average of 2.8% and that's without accounting for population growth.

That is not balanced at all. Our salaries go up by 2.8% and the city spends our money at 9.7%. If by balance you mean the city spends only what we can afford to pay, then the city should only have spent $102.3M. This would could have given the average family of four an extra $230 to spend at local businesses, or fixing up their house, or paying down debts, etc. That might help the economy.

If the city can't deliver culture and recreation that matches our ability to pay, then what good is it doing anyone? Anyone can take money and spend it, but spending it wisely and delivering value for money requires discipline and the ability to make tough choices.

>> I do know that our Economic Development department's mission is exactly that - which is a "spend money to make money"

To see how that's working, let's look at some numbers. From 2005-09, Ontario wages went up 11.7%. In Hamilton, it was likely less due to slower population growth. How much did taxes and user fees go up in Hamilton during that time frame? 17.1%, or 46% more than our earnings. If the city was spending our money wisely, shouldn't taxes be climbing slower than our incomes?

>> I don't know of a private company or sector that can morph Hamílton's economy to one of purely wealth generation.

And neither does anyone else, that will be left up to risk takers and consumers/businesses. In contrast to central planners, who always have the answers to our economic problems, the free market produces wealth in spite of the fact it doesn't have a master plan.

The free market works to produce wealth primarily because it allows wasteful spending to be shut down and shut down quickly. In contrast, when governments spend money, because they can't go out of business, they are never really forced to shut down money losing activities.

Giving more money and spending power to City Hall is like giving a stranger your credit card and asking him to buy you exactly what you want. It can't and it won't happen, because that person is not a mind reader. You may get something pretty good, but it will be less than optimal, making you worse off than had you just spent your own money.

Can you see why Hamilton's economy is in the shape it's in. We are running an economy that spends money inefficiently and that rewards people for failure. And then we are all surprised why we aren't producing jobs that make things people want to buy. Truly amazing.

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