Monday, September 12, 2011

The Case for #Aerotropolis is NOT a Case for New Warehouses


There are 18 million square feet of available warehouse space near Lambert-St. Louis airport; therefore, there is no reason for $300 million in tax credits for warehouses. This is not an indictment of trade with China, but rather the crony capitalism that would finance unneeded warehouses.

The graph above is from CARPE DIEM: A Tariff-Reduction Plan for American Jobs (via CafeHayek):

The same demographics that have created growing foreign markets also mean there are more foreign suppliers of raw materials, industrial inputs, and other intermediate goods used by U.S. producers in their own production processes. Last year, U.S. Customs and Border Patrol collected $30 billion in duties on $2 trillion of imports, 55% of which were ingredients for U.S. production—such as chemicals, minerals and machine parts. Purchases of imported inputs accounted for more than $1 trillion of U.S. production costs, a price tag that was roughly $15 billion higher than it might have been without U.S. import duties.

In short, nearly 60% of American imports drive American businesses. Capital Goods are the tools of production and Industrial Supplies are the inputs that are transformed into finished American-made products. International trade helps fuel the engine of American industry.

There are still 18 million feet of available warehouse space near Lambert-St. Louis airport. The $300 million in tax credits is still a give away to campaign donors like Paul McKee.

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