The answer is: Wassily Leontief.
Oh, I'm sorry. You want to know the question. Silly me. Who is responsible for Charlotte and Atlanta picking taxpayers' pockets to fund a NASCAR museum?
And, as I said, the answer is Leontief (1906-1999). The Nobel-winning economist fled the Bolsheviks. Yet, his work, often embraced by socialist countries, is generally said to be an expression of Marxian economics.
Put another way, what's going on with NASCAR is best described as "socialism for billionaires." Two billionaires, to be precise: NASCAR owners Bill France Jr. and James France.
North Carolina elected officials have offered $122.5 million towards a $137.5 million museum in Charlotte. The Frances will chip in the balance. Still, the public contribution means every man, woman and toddler in the state pays $15.30. And it's a damn sight more than the pikers in Georgia, who are squeezing their constituents for a mere $3.60 apiece.
The two France sibs are each worth $1.6 billion and tie for No. 198 on Forbes' list of the 400 richest Americans.
The average North Carolinian, who earns about $28,000 a year, would have to work for 57,142 years, and not spend anything along the way, to amass the wealth of each of the France brothers.
Thus, Karl Marx's dictum of "from each according to his ability to each according to his need" takes on a slightly different meaning. All of us clearly have the "ability" to chip in a few dollars to the already-flush-with-cash France kinfolk, who through the miracle of "free enterprise" (as in, free to them) declare that they "need" it.
Isn't America great?
So, let's get back to Wassily Leontief, whose big claim to fame was his "input-output" theory. No, no, no, he had nothing to do with escort services, but his ol' in-and-out, as interpreted by civic boosters, has screwed millions and millions of people.
For example, every time a billionaire sports team owner wants a city to cough up a half-billion bucks, he threatens to leave town unless he gets his new palace (the France family is merely practicing a variation on that gambit). City "leaders" immediately proclaim that the stadium (or museum) will have bundles of "economic impact."
Part of that impact, or output, is "direct." You can measure it. Construction costs can be tallied. People will buy tickets and doo-dads, and most of that money will go, in the NASCAR case, to the Frances, with a pittance left over for a few score, mostly low-level employees.
If you believe the spin, the NASCAR museum would generate an economic impact of $1.5 billion over 10 years, and $124 million the first year alone.
The clue to the scam is that "direct" spending at the museum would be about $519 million over 10 years. How do you almost treble that number to get the total economic impact?
It's worth noting that to amass the $519 million number, Charlotte, which lives and breathes NASCAR, is projecting about 400,000 visitors annually. At that level, each sucker, er, fan would have to shell out about $125 -- and that ain't gonna happen.
No one can even begin to say how if you plunk down $125 for a NASCAR Hall of Fame ticket and trinkets that money is going to metastasize into an additional $250 of impact. Sure, some restaurants and hotels might open and prosper -- or would they have opened and prospered anyway?
The input-output multiplier is a big mystery, but shills for sports stadiums and, now, NASCAR museums nonetheless claim the economic alchemy is real.
Phil Porter, an economist at the University of South Florida in Tampa, studies the impact (or, lack thereof) of major sports events. He says the multiplier is mostly smoke.
"It never happens," Porter told me. "If the multiplier is two, then if you took away half of the alleged impact, you would have had zero economy to begin with. It doesn't make sense."
Moreover, you have to ask where even the direct spending comes from. Porter has analyzed numerous sports events, such as Super Bowls, and says that seldom do they bring any measurable new dollars to a city. What they do is transfer money. If people spend money going to a racing museum, they won't spend it on restaurants or movies or nightclubs. Thus, instead of many little businesses' cash registers ringing, the France family will grab the money and run.
"It's a little better with a museum than with something like a Super Bowl," Porter says. A big sports event displaces for a short time a lot of little local business, and Porter's studies show scant added cash into the community, as measured by sales tax receipts.
"A NASCAR museum is there year-round, so cumulatively, it will have some direct impact," Porter says. "But it won't have any major impact on the community's economy. You'd get more impact by investing dollars into schools, hiring teachers, policemen and fire fighters."
Porter, of course, foolishly ignores the obvious: No billionaires are going to make fortunes from building schools. With your input (cash), the France family's output might push them up a few pegs on the Forbes list of the mega-rich.
As I said, Wassily Leontief.
