The American Spectator

Joseph Lawler notes as one of today’s “Must Reads” that in a Wall Street Journal piece, Republican Govs. Mark Sanford (S.C.) and Rick Perry (Texas) are “putting their money where their mouth is.” Unfortunately in some ways they do not put their actions where their mouths are, primarily when it comes to taxpayer subsidies for individual businesses. The two state executives co-write:

The bailout mentality threatens Americans’ sense of personal responsibility.

In a free-market system, competition and one’s own personal stake motivate people to do their best. In this process, the winners create wealth, jobs and new investment, while others go back to the drawing board better prepared to try again.

To an unprecedented degree, government is currently picking winners and losers in the private marketplace, and throwing good money after bad. A prudent investor takes money from low-yield investments and puts them in those that yield better returns. Recent government intervention is doing the opposite — taking capital generated from productive activities and throwing it at enterprises that in many cases need to reorganize their business model.

Too bad that Govs. Sanford and Perry fail to follow their own advice, as their states have doled out millions (maybe billions) of dollars-worth of tax breaks and incentives to specific companies, ostensibly to attract “investment” to their states. South Carolina is very proud that it attracted BMW to the state in the early 1990s, and still periodically subsidizes plant expansions — even as recently as this year. The Palmetto State (as do just about all states) regularly announces new plant expansions, relocations of businesses, new job creation, etc., many of which politicians take credit for because of the targeted incentive programs. Almost none are as big as BMW but many smaller companies get tax breaks and credits that their competitors are often not entitled to. Big business has figured out how to maximize this scam to their benefit, as I reported a few years ago.

So, good times or bad times, whether it’s a “bailout” or an “incentive,” government is still picking the winners and losers. Govs. Sanford and Perry ought not to pretend like they are above it all.