Corporate Welfare Crushed by Citizens!

May 20, 1997, was primary election day in Allentown, Pennsylvania. A corporate welfare handout proposal was on the ballot, and was defeated!



Background -- last year, Allentown voters passed a "home rule charter" consolidating the powers of the city government. Part of that charter included a pact between the business community and city residents, that would freeze all local business taxes (good for business) and freeze that portion of the property tax that falls on structures (good for entrepreneurs, property improvers, structure owners such as homeowners). All future tax increases would have to come from increasing the portion of the city property tax that falls on land value (uh-oh, land speculators and slum landlords might have to pay more in taxes!). In essence, the entire city made itself an enterprise zone.

This year, a few elements in the business community (not the major employers, but the least intensive users of urban land) tried to repeal this. They managed to get a measure placed on the ballot that left their business tax freeze untouched, and would overturn only the part of the deal that bothered them. This would mean significant tax cuts for them and big tax increases for more than 82% of the city's homeowners, while not bringing any new revenue to the city treasury -- a pure, simple transfer of money from the people to the powerful. Allentown's Mayor Heydt vetoed the city council's attempt to place that measure on the ballot, but the veto was overridden.

During the campaign, the corporate welfare queens outspent their opponents, made false statements in advertisements and even had an airplane flyover.

But the people saw through it!

The measure was defeated and Mayor Heydt won his primary too.




For more details, contact
the Henry George Foundation
or the Banneker Center for Economic Justice


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