Economic trade-offs in public spending: stadiums, education, and infrastructure

Macroeconomics Cases Study

New Sports Stadium

The claims by backers of this project may not be objective or accurate. That is because most of the "quality" jobs the project creates will be transitory in nature, such as the construction jobs during its construction. Thereafter, most of the types of jobs necessary to run the new stadium will be unskilled, semi-skilled, and minimum-wage jobs such as ticket booth workers, private security, maintenance and grounds cleanup, parking attendants, and refreshment stand workers. Those are not the type of "quality" jobs that will help the community. Furthermore, there are significant quality-of-life costs associated with the new stadium. For example, high-profile professional sports events almost always cause traffic congestion in their vicinity. Likewise, they absorb community resources such as law enforcement and sanitation workers and add to overtime costs associated with those extra demands.

Transportation Express

In principle improving transportation systems is a good idea for the community. However, it is doubtful that expending more money on highways is worth the expense for several reasons. First, all efforts should be made toward reducing our reliance on fossil fuels instead of encouraging continued reliance on automobiles in the future. Therefore, the available funds should be used to develop alternate transportation methods such as modernized rail systems and even traditional public transportation systems that damage the environment and consume gasoline less than private automobiles on a per-passenger basis.

Second, we should be striving to reduce the trend of working in urban areas and living in suburban areas that developed throughout the 20th century in the United States. That is one of the reasons we became so dependent on automobiles as a nation in the first place. Therefore, the money should be spent on developing better, cleaner, and more efficient public transportation systems and on maintaining existing infrastructure such as bridges and tunnels that are in tremendous states of disrepair across the nation. Conversely, developing new highways is likely counterproductive in the long run.

Eliminating Taxes

Eliminating taxes across the board is not likely an effective way to stimulate jobs, investment, or savings, although it might stimulate spending in the short-term. That is because poor people will use the extra money to pay for essentials and rich people will be largely unaffected by tax cuts in any meaningful way. Poor people are unlikely to save extra money and rich people are unlikely to make significant changes in saving, investing, or spending based on tax cuts. The most effective use of tax cuts would be to use them very selectively as rewards by subsidizing beneficial behaviors (such as weight loss, pursuing higher education, using public transportation, carpooling, and purchasing hybrid vehicles and other clean energy technology.