Wyoming “WIN”: Little More Than Old Wine in New Bottles
By Bradley Harrington
“The art of economics consists in looking not merely at the immediate but at the longer effects of any act or policy; it consists in tracing the consequences of that policy not merely for one group but for all groups.” — Henry Hazlitt, “Economics in One Lesson,” 1946 —
Governments throughout history have always made attempts to violate the Laws of the Universe, for a variety of reasons — and, one and all, they have always failed.
They keep trying, however — and, for the latest local bureaucratic attempt to do just that , we need look no further than right here:
“A Casper company became the first example of how a new program could help small and medium-sized Wyoming businesses access capital and grow. Wyoming Invests Now – or WIN – is a crowdfunding investment opportunity exclusively for Wyoming residents and businesses … Secretary of State Ed Buchanan, whose office administers the WIN program, said it’s a historic step and an important piece of Wyoming’s economic diversification strategy.” (“Wyoming Secretary of State Ed Buchanan kicks off WIN program,” WTE, April 11.)
I have just one question, which will immediately take us to the core of the issue: “To paid for by WHOM?”
And the answer, as it always is with government “economic development” schemes, since government only has what it takes from us first, is: YOU, the taxpayer, who else?
And, if that’s the case, then we have a problem — for what we’re really doing here, through the force of the state, is SHIFTING resources not actually CREATING them — which adds absolutely nothing to our economy.
Bureaucrats keep trying to square the circle, however, and they’ve become expert at pointing to the so-called “gains” — like this attempt, for instance:
“Folks that believe in a company or idea or new technology,” Buchanan said, “are now able to fund startup businesses and allow them to raise capital in a way that’s much more accessible, but also, importantly, allows them to realize at some point in time, hopefully, a return on their investment.”
The extent to which such “investment” opportunities are funded by government, however, is the extent to which the money to pay for them has to be extracted from the taxpayers first, and here’s where all the “economic development” bureaucrats in the world always trip up when questioned on it: “What would the taxpayers have done with that money if they’d been permitted to keep it?”
And the answer? Spent it on other things, or course, such as a new washing machine, or some more groceries for the dinner table, or possibly vehicle repairs, or maybe some new shoes for the kids, or possibly savings in the bank.
In all of these cases, economic expenditures which would have been made by the taxpayers got short-circuited instead by bureaucratic theft, and none of those transactions ever materialized.
Which means: That all those sectors of the economy, which WOULD have been invested into by the taxpayers had they been allowed to keep their money, experienced downturns in their productivity as a result instead. Sorry, folks, the money’s got to come from somewhere.
So, while the bureaucrats have become quite adept at pointing to the short-term gains in ONE sector of the economy that happened to have benefited by their interventionism — McGinley Orthopedics, in this case — they fall flat on their faces when it comes to explaining the losses such policies create in the REST of the economy over longer-term periods of time. Losses which, arithmetically speaking, must at least equal the “gains” of the so-called “beneficiaries.”
In truth, however, there’s a net loss there as well — for plundered dollars never produce as well as free-floating dollars seeking their greatest rates of return. And that’s a surprise?
So, while the bureaucrats can talk a great game about their “investment” opportunities, Henry Hazlitt’s lesson kicks in and gives us the truth of the matter: Those are actually long-term losses, for the best the bureaucrats could ever hope to do, with their taxpayer funds, is fill the hole they created by the original confiscation.
And one more thing, Mr. Buchanan: “Investments” are what PRIVATE capitalists do with their surplus wealth. Government “economic diversity” operations, based in financial thuggery, do not qualify, any more than a bank robber’s vacation to Tahiti could ever be considered as an “investment” into that local community.
So, in the final analysis, what does all of this say about Wyoming “WIN”? That it’s little more than old, economically fascist wine in new interventionist bottles, meriting nothing better than to be poured down the nearest drain.
Bradley Harrington is a computer technician and a writer who lives in Cheyenne. Email: bradhgt1776@gmail.com.
NOTE: This column was originally published in the Wyoming Tribune Eagle on April 15, 2018. EDITOR’S FURTHER NOTE: There is no link here because this column was removed from the WTE’s website due to its errors.
Wyoming “WIN”: It’s a Great Idea, Actually, and I’ve Erred
“A man should never be ashamed to own that he has been in the wrong, which is but saying in other words that he is wiser today than he was yesterday.” — Alexander Pope, “Thoughts on Various Subjects,” 1727 —
Well, Dear Readers, it isn’t very often that I screw up, but it does happen on occasion — and, when I do, both integrity and good journalism demand that I own up to it and correct it afterwards.
As in when I made this claim while discussing the Wyoming “WIN” (“Wyoming Invests Now”) initiative last week, for instance:
“So, while the bureaucrats have become quite adept at pointing to the short-term gains in ONE sector of the economy that happened to have benefited by their interventionism — McGinley Orthopedics, in this case — they fall flat on their faces when it comes to explaining the losses such policies create in the REST of the economy over longer-term periods of time.” (“Wyoming ‘WIN’: Little more than old wine in new bottles,” WTE, April 15.)
Yes, it IS true that when government plunders resources from the taxpayer in order to pay for “economic development” schemes — such as Wyoming’s ENDOW initiatives, for instance, now on track to steal about $45 million from all of us — that this reasoning would apply.
In the case of Wyoming WIN, however, that reasoning is completely invalid, because WIN is not a normal “economic development” scheme, based in taxation like ENDOW, at all … Which is what I THOUGHT it was, and what prompted last week’s rant.
OK, so … If WIN’s NOT a tax-based “economic development” scheme — what IS it instead?
A pretty darned good idea, actually, when it comes right down to it … Which actually ROLLS BACK government regs … Allow me to explain:
■ In 2012 Congress passed, and President Obama signed, the “Jumpstart Our Businesses Startup Act” (“JOBS”), which was intended to ease restrictions and regulations on small business capital investments.
In particular, Title III of that Act, or the “Crowdfund Act” as it is called, wiped out many of the securities restrictions placed on capital investment — and, in 2015, the Securities Exchange Commission approved that Title III ruling, which became effective in 2016.
■ At that point, Ed Murray, our former Wyoming Secretary of State, promoted legislation that would piggyback upon these federal easements and allow Wyoming companies and investors to take advantage of those restriction relaxations. This push, in turn, resulted in legislation (passed by the State Legislature in 2016) that essentially rewrote the Wyoming Uniform Securities Act and replaced most of it with legislation supporting the easements.
■ And that Act, in turn, is what created Wyoming “WIN” (WS 17-4-203) — the “intrastate crowdfunding exemption,” which exempts such investments from the normal mass of SEC regulations and other gobbledygook.
So, just what IS “crowdfunding,” anyway? Webster’s defines it as “the practice of funding a project or venture by raising many small amounts of money from a large number of people, typically via the Internet.”
Well, that sure sounds like the “stock market” and “day trading” to me, practices we’ve had around for a while … But the point, here, is that the stock market continues to suffer under all the SEC regulations, whereas many of the “crowdfunding” opportunities now have those regulations softened or eliminated.
So … NICE! An actual paring back of government! Something, as most of you Dear Readers know, that I’ve been pushing for many years now. Well, here’s a good example of it.
Yes, there’s STILL some restrictions to those exemptions in the new Wyoming Uniform Securities Act, such as ceilings on dollar amounts and whatnot — restrictions that, most likely, need to be relaxed even more.
But, nothing’s perfect, and let’s get the facts straight this time: Wyoming “WIN” is NOT an “economic development” scheme based in taxation at all, but an actual rollback of stupid and stifling federal government regs regarding investment practices … An “enterprise zone,” if you will, regarding crowdfunding and other investment opportunities.
So … OOPS! Yep, I screwed up bigtime. That’s what happens when you jump without looking first.
Therefore, Mr. Buchanan, when I accused you last week of supporting “government ‘economic diversity’ operations based in financial thuggery,” that accusation was based upon false information and a flawed premise, and I therefore retract it.
And, Mr. McGinley of McGinley Orthopedics: When I strongly implied that you were the recipient of looted funds — well, that didn’t happen, either.
And, Dear Readers: I’m sorry to have relayed bogus information. Now you have the proper facts, and I would ask that you accept my apologies as well.
Bradley Harrington is a computer technician and a writer who lives in Cheyenne. Email: bradhgt1776@gmail.com.
NOTE: This column was originally published in the Wyoming Tribune Eagle on April 22, 2018.
