Tea and Tourism Subsidies

Just one day after the 236th anniversary of the Boston Tea Party, Michigan legislators are preparing to divert a portion of today's sales tax revenue to provide a permanent subsidy for a particular group of business owners, Michigan's tourism industry.

Specifically, the legislation would authorize the diversion of hoped-for increases in sales and use tax revenue from the sale of tourism-related goods to pay for public relations campaigns benefitting resort and hotel operators. As a result, the diverted money won't be available to provide essential government services.

The bills do not specify whether the Legislature should cut those services or increase other taxes and fees to make up the difference.

Poor Sam Adams must be rolling over in his grave. However, these and many other subsidy shenanigans are occurring while modern day Tea Party patriots are rising up to stage their own protests. Measures like this feed their belief that legislators are insensitive to the plight of middle class taxpayers.

Incredibly, the tourism industry beneficiaries of these special favors have refused to voluntarily pay for such PR campaigns. The following appears in the Michigan Tourism Industry Planning Council's 2007-2011 strategic planning report, titled "Michigan Tourism Strategic Plan":

There is absolutely no industry support for a broad-based industry self-assessment approach to generate sufficient monies to fund Travel Michigan (which "markets the state's tourism industry") ... Without exception, representatives from a variety of tourism industry segments indicated their members and/or Boards would strongly oppose such an approach.

This is an implicit admission that these hotel and resort owners don't really believe that state promotion of tourism is a very effective tool. But they'll be happy to let others pay for it, and have been lobbying hard all year for just that.

Permission to reprint this blog post in whole or in part is hereby granted, provided that the author (or authors) and the Mackinac Center for Public Policy are properly cited.