Tuesday, March 21, 2006

"Housing would be better choice for Willets Point" in TimesLedger 03/09/06

Alternatives, alternatives. Oh, when will the city apply the economic principles they supposedly learned in Economics 101? Corporate welfare as in the case of giving away valuable parkland and tax subsidies for the Yankees to building unnecessary convention centers in Queens distorts the efficiency of the markets. This letter in the Times Ledger illustrates these points:

Housing would be better choice for Willets Point
03/09/2006 Times Ledger

In proposing a Jets stadium in Flushing Meadows Corona Park, Queens Borough President Helen Marshall was swimming in a sea of misguidedness and her current proposal for a convention center in Willets Point is in my opinion no less misguided. ("Convention center likely for Willets Pt.: Marshall," TimesLedger Feb. 16).

Independent experts consider convention centers poor generators of economic activities which consistently fail to achieve the results supporters predict for them. Boston spent $800 million on an a new center and had booked so few shows it is likely to run a $12 million annual deficit for each of the next several years. Portland, Ore., spent $116 million to double the size of its convention center and lost $5.3 million in revenue and witnessed occupancy fall from 71 percent to 43 percent. The original Javits Center in Manhattan was sold to the public on the basis it would spur widespread development on the West Side, but after almost 20 years it has produced almost nothing. (Steven Malanga, contributing editor to The Manhattan Institute's City Journal).

The current expansion of the Javits Center will produce the same dismal results.

This country is awash in convention centers and there is no industry demand for more or bigger centers. A Brookings Institution report found there is a glut in convention space and questioned the wisdom of joining a convention hall race. (The New York Times, Jan. 18, 2005). In its Feb. 28, 2005, issue a Forbes article stated "the Business is a mess, plagued by taxpayer-funded burst of expansion and a continuing dearth of customers." The article further pointed out that "shows in general are far less relevant. Consolidation in industries like manufacturing, retail and technology has left a smaller pool of exhibitors."

In 2003 St. Louis made a $270 million convention space expansion with rosy predictions, only to end up with a lackluster neighborhood punctuated by a store peddling gold chains and a discount sneaker outlet. Moody's downgraded the city's $50 million hotel bonds even deeper into junk.

Perhaps the best argument against more and more convention space expansion is the fact that no entrepreneurs are willing to put up their own money for a convention center. They get built only because of myopic politicians who are too willing to have taxpayers foot the bill.

If the expansion of Javits Center is foolish, another convention center in Queens is absurd. If a host of small businesses are to be displaced from Willets Point, a premise unwise to begin with, it should at least be for the public good, like publicly supported affordable housing.

Benjamin M. Haber



Post a Comment

<< Home