NFL Playoffs, Yes; Taxpayer-Funded Stadium, No

The Minnesota Vikings take on the Philadelphia Eagles in an NFL playoff game on Sunday, January 4.

Why do I care? Well, I am a long-suffering Vikings fan, and am just pleased to see my team in the post-season. Hey, if star running back Adrian Peterson breaks a few, and QB Tavaris Jackson plays smart, who knows?

But why should you care? Well, if you are not a Vikings or Eagles fan, but are a taxpayer, then you should take note of another case of silly, wasteful politics trying to be dressed up as sound economics.

The Star Tribune reported on January 2 that the owner of the Vikings is taking this playoff appearance as another opportunity to beg for a huge taxpayer handout to build the Vikings a new stadium. The story noted:

With the state and federal governments looking for ways to jump-start the economy, a New Jersey businessman has an ambitious public works project he says will create more than 5,500 jobs and provide $500 million or more to local contractors.

The businessman is Zygi Wilf, principal owner of the Minnesota Vikings.

The project: A $954 million, state-of-the-art stadium for his football team in downtown Minneapolis -- to be constructed using more than $635 million in public money.

"Why not? The Vikings are a public asset," said Lester Bagley, the Vikings' vice president in charge of stadium development. "This is going to create an economic boost."

In a rare moment of clarity, a couple of key politicians had the right response, i.e., laughter:

In fact, two legislative leaders laughed out loud when asked whether the House and Senate would seriously consider the Vikings' bid this session.

"It certainly will not be a high priority," Senate Majority Leader Larry Pogemiller, DFL-Minneapolis, said recently. "We have a fiscal and job crisis in Minnesota."

Margaret Anderson Kelliher, the speaker of the House, was even more blunt about the Vikings' chances of getting state money from the Legislature.

"There is no chance," the Minneapolis DFLer said. "It's a great idea if they would pay for it themselves. But we are in uncharted economic waters. We are in a crisis situation, and we have to focus on the financial and economic health of the state."

We are in an era of silly economics. If we believe that massive federal government spending on infrastructure projects is going to lift the economy, then why not massive state and local spending on a football stadium?

Of course, the answer is: Neither federal infrastructure spending nor doling out tax dollars for a sports stadium will spur the economy.

Raymond J. Keating
Chief Economist
Small Business & Entrepreneurship Council

Small Business Health Care Discussion: It's the Cost!

The Obama transition team invited folks to host “health care discussions” over the holidays until December 31. In particular, they were looking for “poignant stories” to help underscore the need for health care reform.

A December 30 Washington Post article reports that the purpose behind these gatherings is to help build broad public support for reform (as if that does not already exist), “betting that the energetic, technology-savvy supporters who fueled his [Obama’s] candidacy will act as a potent counterbalance to the traditionally powerful special interests that have defeated similar reform efforts.” According to the article, about 8,500 health care discussions have been scheduled.

If you were not able to host a health care forum, you can still send your concerns and ideas to the Obama Transition Website page “Health Care -- Of the People, By the People” by visiting this link: http://change.gov/page/s/healthcare. However, as a small business owner, we can guess what your key concerns might be. These are concerns that the Obama team are probably aware of – rising premium costs; the inability to buy or access coverage due to high costs, the lack of choice in plans, and -- to repeat – high cost, high cost, high cost.

The fact that millions of small business owners cannot offer health insurance for their employees (and many self-employed individuals for themselves or their families) due to high costs continues as one of the more poignant and distressing stories that should have triggered dramatic action by our elected officials long ago.

According to the Kaiser Family Foundation/Health Research and Educational Trust annual health benefits survey released in September 2008, “just under half (49 percent) of the smallest firms (three to nine workers) offer health benefits. Among all small firms (three to 199 workers) not offering health benefits, nearly half (48 percent) cite high premiums as the most important reason for not doing so.” The survey points out that “premiums for employer-sponsored health insurance rose to $12,680 for family coverage this year – with employees on average paying $3,354 out of their paychecks to cover their share of the cost.”

“Making health care more affordable” is a top concern for small firms, according to a December 2008 survey of small business owners by the Robert Wood Foundation. Of the 400 small firms surveyed (all of which offer health insurance, and pay for “some portion” of it), 42 percent say “making health care more affordable is the idea Washington should first address,” according to the foundation’s media release.

If you are at all familiar with SBE Council’s congressional testimony, research briefs, Op-Eds, transcripts of radio and television interviews, and letters to Congress as well as the two Administrations over the past 15 years, you know what we have been saying about health coverage and the key issue for small businesses – high, and ever-increasing, costs!

With costs being the top issue, do we really believe that mandates on small firms to “play –or-pay” will really help those firms that cannot afford coverage? While the Wood Foundation survey found that 53 percent of small firms that currently provide coverage do support some type of play-or-pay scheme, no voice was given to those small businesses that currently can't provide insurance. Isn’t that what we are after here? Providing those who can’t afford to offer insurance some options for doing so?

Not surprisingly, 68 percent of the foundation’s survey “said they would support a market-based approach to provide employees with tax credits to purchase their own portable, private health insurance, as well as encourage the use of health savings accounts and include tort reform for medical liability lawsuits.” In addition “78 percent said they would support a reform package that combines government-sponsored purchasing pools to allow small businesses to purchase insurance at negotiated bulk rates along with tax credits to make offering insurance more affordable for small businesses.”

The long-standing concern of business owners that “cost” is the issue when it comes to providing and maintaining health coverage for their employees, should serve to demonstrate that solutions focused on incentives (carrots) rather than punitive mandates (sticks) -- particularly in these rough economic times – will hopefully guide the passage of workable solutions that give small businesses real (affordable) options for providing their workforce with the health insurance they need and deserve.

Karen Kerrigan, President & CEO