For months we’ve been joining commonsense conservatives in opposing subsidies for the developers pushing an F1 racetrack. Today, after Comptroller Combs announced any payments from state coffers would come only after a race met specific economic requirements, construction on the facility outside Austin came to a screeching halt. In light of not automatically getting $25 million a year for the next decade, the promoters are apparently admitting the juice isn’t worth it if they can’t squeeze the taxpayer.
On Sunday we noted Comptroller Combs’ concerns that the project was looking less viable, despite her long-standing support for it. Today, she expanded on that in a statement to the press, noting no payments from the state’s Major Events Fund would be made until after an actual F1 race was held and the economic impact could be determined.
Almost immediately, the guys pushing the track turned tail and ran, suspending work on the track`, according to the Austin American Statesman.
It was recently revealed the local consortium of well-healed crony capitalists who had pushed for the project not only hadn’t actually secured rights to hold an F1 race, but that F1 officials were skeptical it would ever happen. Additionally, local promoters pushed for the subsidy on the basis that it would be the only such race in the US, a claim undermined by the announced construction of a track in New Jersey… without any taxpayer subsidies.
Fiscally irresponsible State Sen. Kirk Watson (D-Austin) had pushed for the allowance of an F1 subsidy in the Major Events Fund a couple years ago.
You can now expect Watson and his bipartisan band of tax-and-spenders to decry how horrible this is, about how Texas stands to lose so much. In fact, taxpayers win by not losing our shirt on a project developers were unwilling to risk their own long-term capital on.
All too often, politically-connected fat-cats try to minimize the economic risks associated with their expensive hobbies and interests by having lawmakers use our money to subsidize them, or government power to force us to participate (abuse of eminent domain is one example).
Any business model requiring subsidies from the taxpayers, or coercion by government, is simply unsustainable and will be revealed as a long-term loser.
I’m glad to see Comptroller Combs got on the right side of the F1 issue, protecting Texas taxpayers from what would have undoubtedly would have been a fiscal disaster.
Crony capitalism is a loser, start to finish. It’s great to see the wheels came off this project before it actually cost the state anything.