Advancing Saint Louis through Bad Economics
This morning at the office, David Stokes brought in a mailer he received from Advance Saint Louis urging him to vote in favor of Proposition A, which would institute a half-cent tax in Saint Louis County dedicated to funding Metro. The top fact used to support the mailer’s headline, “Our Economy Depends on Metro,” reads “Transit generates JOBS. To date, $15 billion in new development has occurred within a 10 minute walk of MetroLink.” Strictly speaking, I don’t think this statement is false, but it definitely misleads by omission.
First — and this should be pointed out every time a politician talks about creating jobs — it should be pointed out that jobs are a cost, not a benefit. Goods and services are the benefits we get from the cost of working, and if we can create more goods and services with less work, we should. If Metro could transport the same number of people just as efficiently with half as many employees, that would be a clear benefit to the overall economy (Metro might even come close to breaking even if that happened). Furthermore, creating jobs by spending tax dollars ignores the unseen costs of the taxes. If that money had not been taxed away, taxpayers would have spent it on a multitude of goods and services, or saved it to be lent out to entrepreneurs, home buyers, and the like. With the tax in place, those goods, services, and loans (and the wages that depended on them) will never exist, so we will never know the true opportunity costs of spending more tax dollars on Metro.
With regards to the statement’s second sentence, the mailer never claims that the $15 billion in new development near the MetroLink was actually caused by the MetroLink. I take the absence of such a claim to be good evidence that Advance Saint Louis has no good evidence that MetroLink has substantially contributed to this new development. I’m sure MetroLink is at least a marginal factor in some of this development, but I’m sure a much bigger factor is that MetroLink runs through the most desired areas in the Saint Louis area: downtown, the Central West End, Washington University, Brentwood, Clayton, etc. MetroLink follows development, not the other way around.
Finally, the bottom of the mailer informs us that Metro “operates with one of the lowest costs per passenger to the taxpayer,” which ignores two important points: 1) relative comparisons tell us nothing about the absolute costs and benefits of the system and 2) a new tax to support Metro will obviously lower Metro’s ranking on that metric.