Touring Subsidies


The next time your local tourism lobby starts asking for government handouts, take a hard look at the numbers it's throwing around. John Hood did that in North Carolina and saw the industry's arguments rapidly deflate.

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  1. In Tallahassee they are fighting to fund a new convention center and possibly some type of arts pavilion. Initially, I was totally against the idea, with the normal libertarian viewpoints. If it is such a great business idea, why doesn’t private industry create it, why should I pay for someone else’s entertainment, etc.

    Well, they threw me for a loop the other day when they proposed that the projects be funded by an increase in the hotel tax. Before you start crying for the “tourists” staying in the hotels, remember that Tally is the capital city. Yes, that means that lawmakers and lobbyists will have to fork the bill, I can’t think of a better demographic to tax!

    On a different note, I was always amused by the fact that a couple of years ago, when I lived in Oklahoma, the state tourism board began referring to tourism as their “new cash crop”. Riiiight. Sad if true.

  2. Speaking of tourism, as some of you know I spent the weekend in Rhode Island, and I heartily recommend that everyone go there. Though my primary purpose was to visit H.P. Lovecraft’s grave (no Cthulu sightings I must add), I also journeyed down to Newport, which is filled with a plethora of “gilded age” mansions. We took the tour of the Astor “cottage” (this cottage was more a kin to what one would think of as a mansion) and had great fun gawking at all the deliriously ornate piles. Lots of good places to eat as well!

    Of special note is Providence, R.I. itself; having read about the city many years ago I expect to find a rustbelt city that mirrored some parts of Cinncinati or Detroit, but its apparent downtown Providence, with its elegant malls and numerous eating establishments has really turned itself around.

    Saturday evening in Providence we witnessed one of the most unique events I’ve ever found in the US: “waterfire.” Obviously inspired by European water festivals, the event features the lighting of fires along a two mile stretch of a canal (the fires are in the canal itself). The fires are lit by person’s in boats, while men in small gondolas throw flowers to the crowd; some of the boats also have men dressed as gargoyles in them. As the night progresses the fires are kept burning by boats which load them up with more wood. Oh yes, and the music that goes with the event is wonderful. The effect, especially the initial lighting, when the gargoyles are present and moving about the boats, is eerie and thrilling.

    So visit Rhode Island when you get a chance! 🙂

  3. I think John Hood omits a large chunk of NC tourism with the statistic he cites. I’ve visited NC many times as a tourist, eaten crabs and vinegar based barbecue, been to the Roanoke colony, the state aquarium, Kitty Hawk, the lighthouses, and so on, but never stayed in a hotel (barring one hurricane evac) – always in a rental beach cottage on the Outer Banks. I’d say the outer banks reflect most of the state’s tourism (so if they’re spending money on stadiums instead of a replacement for the Bonner bridge, they are greatly misallocating their resources). I suspect cottage-rental stats aren’t captured in the hotel dollar figure. But I’m not sure. Anyone know?

  4. Keith,

    The N.C. coast is gorgeous.

  5. Keith:

    Thanks for that commercial for North Carolina’s Outer Banks attractions. And you did it without a government subsidy! However, just to correct the record, the BEA data are for “hotels and other lodging” — which includes various rental and vacation properties. That’s why I considered it a useful proxy for tourism spending as a whole. BTW, visitors to the Outer Banks do not make up the majority of tourism to NC. The Grand Strand up from Myrtle Beach, SC to just outside Wilmington, NC, gets a big chunk of visitors, as do the NC mountains (the highest and most picturesque east of the Mississippi River).

    And then there’s the government-subsidized hockey team in Raleigh, which draws in millions, I mean thousands, I mean hundreds . . .

    Uh, never mind.

  6. I hate to bust your good mood, Brady. However, you don’t think those gov’t officials are spending their own money on the hotel bills, do you? So, you and all the other Florida taxpayers, who support the general assembly, send your money to the state (sales or income tax, I forget which one you have there). That money flows through to help pay the extra hotel tax that pays for the artsy-fartsy center, or whatever it’s real name is.

    Adam Smith or Milton Freidman would probably have an expression to describe this. I call it “Bullshit” ;-}

  7. One more thing, hang on a minute:

    How can any state say tourism is it’s top industry, when we all know the marijuana farming business is?

    Maybe the numbers would go back up (for the writer from the Carolina Journal) if one would include the tourists’ influx of cash into the pot industry, also known by it’s proper name, “reefotourism” (TM).

  8. Every state says tourism is it’s top industry probably in large part because no one much gets around to proving that it isn’t, I would think 🙂

  9. John Hood,

    What about my unsolicitied advertisement for Rhode Island? 🙂

  10. I drove through RI once. the best 20 minutes of the trip too.

  11. Why do they call it “tourist season” if we’re not allowed to shoot them?

  12. We just managed to beat back the tourism and convention handout hordes in Cleveland. The Mayor here was forced to pull support for a new tax to fund a new Convention Center of an indeterminate cost (they claimed under $300 million, but it was really closer to $500 mill and rising). The Cleveland tax was going to be a bed tax and additional sales tax. They had loaded the plan up with so many other projects and gifts for support that it would have been a 35 year tax for around $2 billion, when it was all said and done.

  13. >

    Yes, yes, but it involved unspeakable fish people from the murky depths. I mean, I’m up for it, but that’s not your typical family’s idea of good, clean fun.

  14. Jean Bart:

    “John Hood,What about my unsolicitied advertisement for Rhode Island?”

    Well, I’ve only been there once, and I can’t say I was particularly impressed. But it is possible that my memory has been tainted after the fact by the frequent complaints of one of my staff. He is a Rhode Island native who isn’t, shall we say, proud of that fact. He wrote a recent newspaper column on the subject that you might find amusing. Here’s the link:

  15. Jimmy:

    You are correct. But, just don’t ruin my fun with the lobbyists 😉

    btw…no income tax in FL.

  16. Tennessee, huh? I don’t think the tourist industry has been too bad for Memphis.

    The author’s assumption that counting his evening out as “tourism” is silly has a problem: if he spends his money in a former urban shithole, helping to support a business that rehabbed an old storefront in what used to be the boarded up waterfront district of that city, then it is perfectly appropriate to count that money as tourist money, at least on a municipal level.

  17. Well, first off Joe, if people only knew that they could see Elvis at K-Mart, they would have no need to get to Memphis. I’ve seen him a few times over in auto parts shopping for oil filters and aftermarket chrome headers.

    OK, seriously, you can count local money spend on the town anyway you want. I just don’t want the government to think of that as an “industry” and subsidize it. If you saved your “out on the town” money, Joe, and later spent (along with other money) on a new car, you’d also be supporting “an industry”. It’s none of the gov’t bidness how you spend your money – so they should not be supporting one lifestyle vs. another.

    I wonder why downtown was a shithole to begin with? Perhaps it had high property taxes, yet only poor on-the-dole people in residence, hence no tax base for improvements and no citizens who give a dang about how their place looks.

  18. “I wonder why downtown was a shithole to begin with? Perhaps it had high property taxes, yet only poor on-the-dole people in residence, hence no tax base for improvements and no citizens who give a dang about how their place looks.”

    “ begin with…” You think our major industrial cities were founded as crumbling slums for unemployed people? Look at the architectural detail in the next urban shithole you visit. Look at the old statues on public greens. There used to be a lot of money being made in those places. The poverty of post-industrial cities was the result of broader forces. No matter what policies a local government may have enacted, the flight of industry and commerce from city centers was irresistable. Cities need to reinvent themselves for the post-industrial economy, and focusing on leisure and culture is a good strategy.

    This is off Hood’s point, however. He argued that counting restaurant income as tourist dollars was dumb on the state level, because so much of that money is from in state. He’s right. Tourism probably is a bad investment for most states as a statewide economic development strategy.

  19. “You think our major industrial cities were founded as crumbling slums for unemployed people?”

    NO, JOE, that’s just the point. After as hardworking blue-collar, white-collar, whatever, people move out, then there’s a problem. These places are crumbling slums cause the manufacturing jobs are gone (not least due to overbearing government regulation, but also unions and other reasons).

    How is the city gonna keep scraping off the gang graffiti off the cool statues and keep the public greens cleared of the malt liquor cans and crack pipes, when there is no money to do so?

    In the process of arguing with me, Joe, you tend to make logical arguments in support of my point.

    We also AGREE on what Hood said, so enough.

  20. I live in a central city in which a large part of the downtown economy is based around people coming from surrounding communities, states, even across the country, to go to museums and shows, and walk around a well preserved 19th century city – cobblestone streets, mercantile buildings, trolleys, mill buildings, etc. Sponsoring festivals, controlling crime, keeping up the city’s physical condition, and constructing an arena and minor league ballpark have turned what was widely considered a post-industrial shithole into a popular and prosperous city.

  21. Joe, an artsy-fartsy shithole is still a shithole, nonetheless.

    Ooh, cobblestones, I’m there ….

  22. Get a lot of tourists planning their long weekend around a visit to your suburb, Jim?

  23. No, and please don’t come down here for Christmas, either. (I’m not in a suburb, for the laaast time …)

    Welcome to Tennessee, now go home!

  24. John Hood,

    I admit a bias – Rhode Island is the birthplace of H.P. Lovecraft, one of my favorite writers.

  25. “After as hardworking blue-collar, white-collar, whatever, people move out, then there’s a problem.”

    Correct me if I’m wrong, but your point seemed to be that the flight of industry, and of blue collar workers, from northern industrial city centers was the result of those municipalities’ policy decisions. That’s nonsense. It was the result of policy decisions made at the national level regarding mortgages, highways, and urban renewal – as well as the growth of the American South and other countries as attractive sites for industry. The shitholeness was the result of industry’s flight, not the cause.

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