March 30, 2008
Mile-high rent seeking

How "unions which represent just 7 percent of Colorado's private workforce [threaten] to permanently encumber the state in exchange for a four-day party":

The four-day Democratic National Convention in August is expected to pump $160 million directly into the regional economy. The economic shot-in-the-arm, whatever the total actually ends up being, will be a welcome boost. But we're beginning to question whether the short-term benefit is worth the long-term expenses.

Denver, and Colorado, could be left holding the bag for years to come. Even before the Democrats awarded their national convention to Denver, Mayor John Hickenlooper had to promise a union-run hotel, the city's first. He delivered.

Then ... Denver cops received at least a 14 percent salary increase for the next three years. The contract nearly tripled the percentage raise handed out in the previous three-year contract.

[Next, Governor] Ritter delivered his Friday afternoon executive order, granting state workers unnecessary collective bargaining rights that will drive up the cost of state government.
[...]

The Service Employees International Union [promised to] strike during the DNC if it needs to. The union is concerned about which company may get the contract to manage parking at DIA. [...] Then we learned that three city councilmen, two with strong union ties, met privately with representatives of the union and one of the companies vying for the parking contract. Not only was the meeting in violation of Colorado's open meetings law, it raised questions about who those councilmen are working for: the union or Denverites?

Hickenlooper has promised that not a penny of taxpayer money would be spent on the convention. Yet it appears taxpayers could pay more indirectly for having the convention here.

Don't know where the $160 million number came from, but almost certainly some bogus "multiplier" has been applied and any displacement of other activities by the convention has been ignored.

Posted by Wilson Mixon at 01:40 PM in Economics

The statesman who should attempt to direct private people in what manner they ought to employ their capitals would not only load himself with a most unnecessary attention, but assume an authority which could safely be trusted, not only to no single person, but to no council or senate whatever, and which would nowhere be so dangerous as in the hands of a man who had folly and presumption enough to fancy himself fit to exercise it. -Adam Smith

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