A little less than a month is left in the 85th Legislature and Texas legislators, among many other issues, will have to decide whether to support one more business incentive program or the creation of one more fund to generate "economic development," and how much to fund already existing ones.
It is important to remember that government intervention in the marketplace is never neutral. Beyond the eventuality of the alleged economic benefits of government's preferential treatments to some businesses are the negative consequences these preferential treatments have on non-subsidized businesses and on taxpayers. As Johan Norberg explains in this short video: when government is in the business of "economic development," what it really does is picking losers.
Norberg concludes with a quote from economic historian Eli Heckscher that we hope our legislators can keep in mind when they make their decision on business incentive programs: "Either a company is viable, and then it doesn't need government support; or it's not viable, and then it doesn't deserve government support."