Uneasy Rhetoric

I realize Dan Weintraub and I might be on the same side of the arena issue (and it gives me hives to think we might share anything), insofar as we’ve bothered to choose a side, but something didn’t quite strike me as right in his column in today’s Sunday Forum in the Bee.

Dan argues that, from an economic standpoint, city folk might want to vote for the arena since it probably represents a transfer of economic resources from the suburbs, where most of the ticket-buying and thus game-attending fans live, to the city. “The transfer of wealth from the suburbs to the inner city just may be the best economic argument for building the arena.”

On the other hand, suburbia might want to oppose it because it represents a transfer of economic resources *out* of their communities. To bolster his argument, Weintraub points out that:

The city of Sacramento accounts for only about one-third of the sales tax generated in the county. So if it costs $600 million to build the arena, $400 million would be coming from the suburbs. Only about $200 million would be generated by sales within the city of Sacramento.

But the problem here is that the suburban residents are not necessarily responsible for two-thirds of the sales tax (and thus two-thirds of the cost of the new arena). We have no way of knowing whether the sales tax coming from the suburbs is due to local spending or is due to spending from city folk going out to the suburbs to do their shopping. We only know that an item bought in the suburbs, whether by a resident of Carmichael, Sacramento, or Atlanta, GA, is taxed in the suburbs.

If I had to guess, I would suggest that maybe, maybe, some portion of that two-thirds is coming from city folk, just as some portion of the one-third is coming from the suburbs. However, I would hazard to guess that more city folk buy more taxable items in the suburbs than the suburbanites buy in the City. City folk might travel to the burbs to buy their clothes at the Folsom outlets, their cars in Elk Grove, and their toothpaste at WalMart.

If you believe that the arena is the key to spurring downtown development, then even suburbanites should support it. Given that Sacramento will inevitably grow, having a vibrant downtown with lots of housing in the Railyards and other inner-city developments will ease the pressure on the suburbs to accommodate more traffic and more people, two things which would degrade the “suburban lifestyle.”

Of course, Weintraub points out right at the beginning of his article that:

Sacramento County voters who are serious about evaluating the proposal to build a new arena for the owners of the NBA Kings will soon discover what every credible study on the subject has concluded: new arenas add little or nothing to the economies of the regions in which they are built.

Most of the money patrons spend is unloaded inside the arena. It goes to the owners of the teams and the players they put on the court, and then is promptly transferred out of the area.