It Was a Win/Win Deal. So of Course They Rejected It.

On November 6, 1906, an American entrepreneur named Augustus E. Staley incorporated his cornstarch manufacturing business in Decatur, Illinois— the first city that Abraham Lincoln came to when he first moved to Illinois at the young age of 21.

Staley’s A.E. Staley Manufacturing Company made cornstarch… which is hardly sexy by modern business standards. But over time his company was a huge sucess and grew it into a major Midwest food processor.

Like a lot of companies back in that day, Staley ran a “Fellowship Club” for his workers. And in the year 1919, some of the members of that club formed an intramural sports team to play what was then a strange and relatively new game called gridiron football.

The game was starting to become a lot more popular. And both the sport, and the team, took off.

By 1920 the Decatur Staleys had already won a state championship and had become a charter member of the brand new league that would become the National Football League. Shortly after the team, now professional, moved to the city of Chicago and renamed itself to da Bears.

What started off as a little intramural team survived everything the twentieth century threw at it: the Great Depression, World War II, brutal riots, political violence, domestic terrorism, and the gangland chaos of Al Capone’s Chicago.

For more than a century, though, the Bears stayed true to the city of Chicago. But everyone has a breaking point, even the Chicago Bears.

Late last week, the Bears’ board of directors voted to advance a stadium development project across the border in Hammond, Indiana… signaling what could very well be their permanent  departure from Chicago.

For more than fifty years, the Bears have leased Soldier Field from the city of Chicago. Five years ago, they decided to build their own stadium, paying $197 million for a nearby 326-acre parcel.

Da Bears further earmarked $2 billion of private capital to build a stadium on that site.

But the organization is not stupid. They know Illinois is broke. The state’s pension system is $143 billion in the hole (the worst in America), and Chicago faces a $1.2 billion annual shortfall.

So before sinking billions into the ground, the team wanted assurances that politicians wouldn’t tax the new stadium to death.

They asked for reasonable concessions— the sort of deal that any large business negotiates with cities and states before making major investments.

This is totally normal. Cities routinely grant some property-tax certainty or minor tax breaks, and in exchange they get billions in private investment, jobs, tourism, and a new tax base. Everyone comes out ahead.

This, after all, is the entire basis of capitalism: You win AND I win.

The medieval world was a zero-sum game, where one side got richer only by taking from another; capitalism’s radical idea is that the pie itself can grow, so everyone can win if they work together towards a common goal.

Sadly, that remains a foreign concept on the political left.

The tax negotiation required Illinois lawmakers’ approval, and the legislature had five years to get it done. Yet they never did. After this spring’s legislative session ended last week without the Bear’s tax deal getting done, the team finally made the decision to move on.

It’s just a short drive across the border to Indiana. But the business environment is completely different. Indiana runs a budget surplus, sits on $2.5 billion in reserves, and carries a coveted AAA rating.

And it only took Indiana’s legislature a couple of months to pass a variety of incentives— worth up to $1 billion. Illinois is squeezing the team. Indiana is rolling out the red carpet.

It’s not hard to understand why: billions in private construction, thousands of jobs, and lots of new tourism dollars.

Illinois could have had that. But the Left simply does not want to do win/win deals.

Governor JB Pritzker, himself a billionaire heir to the Hyatt Hotel fortune, said he “wasn’t willing to give up billions of dollars of taxpayer money in order to give it to a billionaire-owned family, or team.”

Think about that. They’d rather lose the team— lose the tax base, lose prosperity, make the city worse off— than make a single concession to the Bears, simply because the owner is a billionaire.

This is what I call Billionaire Derangement Syndrome.

It was the same thing in 2019 when New York progressives (led by Alexandria Ocasio-Cortez) chased Jeff Bezos out of town. Amazon was considering New York City for its “HQ2” location, bringing billions in investment and tens of thousands of highly paid jobs.

But AOC wasn’t having any of that; Bezos, one of the world’s richest men, would have benefited from the deal, so AOC killed it… then took a victory lap to celebrate hollowing out the city’s tax base.

In the end, Bezos and Amazon did just fine. New York City has suffered. The Bears will be just fine. Chicago will suffer.

The Left only knows chaos and destruction. And their endless affliction with Billionaire Derangement Syndrome is one of the great risks to American prosperity.

There was once a time in America when successful people were admired as proof that anyone willing to build something could rise.

Now, across much of the Left, “the rich” are enemies of the state to be taxed into the ground, driven out town, or, as the activists chant, imprisoned or even ‘eaten’.

This derangement drives away the very people and capital that create prosperity and pay for everything that politicians claim to care about.

When the place you live starts treating productive people and their money as enemies to punish, rather than partners to welcome, the rational move is to think about your own Plan B.

Source

Simon Black is an international investor, entrepreneur and permanent traveler. His daily letter is both educational and entertaining, and we suggest that those who want unbiased, actionable information about global opportunities sign up for Sovereign Man’s free, actionable newsletter at http://www.SovereignMan.com.

From Simon Black of SovereignMan.com

Source: https://www.schiffsovereign.com/trends/155288-155288/