by Yevgeny Shrago
While America watched its lawmakers step back from the edge of fiscal collapse this week (in a deal that progressives shouldn’t worry too much about, since future cuts always get reversed by future Congresses), a small-scale drama involving Long Island sports showed exactly where Tea Party priorities lie. Edward P. Mangano, the Nassau County Commissioner who willingly put Nassau County into receivership rather than raise taxes, suffered a different kind of setback this week, as Nassau County voters defeated a proposed $400M bond issuance that Mangano put forward to build a new arena for the National Hockey League’s hapless New York Islanders.
Sports arenas are a terrible deal for most communities. They finance the stadium and pay back the loans, while the owner gets the actual stadium to do with what she will. The reason the Islanders need a new arena is that when voters and government officials in Nassau approved the old one, they retained ownership. The new arena would have been publicly financed on a 30-year bond. In return, the Islanders would pay a percentage of their revenues to the county every year. Unfortunately, if the Islanders revenue remained stagnant or improved only moderately, the return would have still left the county in the red on the deal. Opponents of the deal charged that Mangano’s numbers, which projected a 73% increase in attendance, were unbelievably rosy.
Fuzzy numbers, socialized losses and privatized gains sound like they could have come right out of the political debates on the national stage. But Mangano is a Tea Party electee who promised fiscal sense and lower taxes. Unfortunately, counties need to pay their debts: when the attendance bump from the new arena subsided, Nassau County residents would have seen their already stretched budget take on a new set of obligations. Maybe this is what Mangano wanted though; after all, fiscal crises are a great opportunity to break unions and cut welfare payments, while leaving subsidies to private businesses untouched, all in the name of the “free market.”