Break the Spell of the Public Corporations (and Progressivism)

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Having been a bit of a lefty in high school and early on in college — until I found the progressive ideology untenable in the face of reality — I’m keenly aware of the ways in which the principles that lead many people to progressivism are actually undermined by the ideology that they proclaim.  I don’t know whether Nicholas Delmenico is actually a progressive, but he recently posted an op-ed on RI Future, a progressive site, with which I can agree, concerning the proposed PawSox stadium:

Increasing the power of public corporations in Rhode Island puts us on the dangerous path to be controlled by the public corporations because once bonds are sold, the state cannot legislate its way out of the contract entered into by the public corporation. These agencies can bend city and state governments to their will if we let them. It is easy to give these public corporations more power, but it is much more difficult to take it away.

Of course, the “binding” of which Delmenico writes is a bit of a spell woven by lawyers’ jargon, financiers’ threats, and politicians’ dissembling.  The reason the government gets around the constitutional requirement for the public to vote on public debt when it uses these quasi-public corporations is that taxpayers don’t, technically, back the debt with their full faith and credit.

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Investors are savvy enough to recognize this distinction, so the consequence of declining to follow through on the politicians’ promise to back the debt is likely to be limited to lesser ability for Rhode Island and other governments to initiate such schemes in the future.  In other words, it’s more of a benefit than a consequence.

The peculiarity of this argument’s appearing on a progressive commentary site is that the scheme is nothing other than a loophole through which central planners can do what they believe to be right without the public’s getting in the way.  Although exceptions may exist on specific controversies, the virtue of such an approach is inextricable from progressivism.



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