The Incentive-Industrial Complex

While most Texans put in a hard day’s work to support their families, there are some among us who are content to live off the labor of others. Sadly, this is a truism in our current political sphere. And no, I am not talking about many of our political figures; though some are complicit with this behavior.

The worst corruption is often codified in the law. We might believe that sunlight is the best cure for government corruption; alarmingly though, the case of state economic incentives is a type of graft that takes place in broad daylight.

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It seems the State's economic development marketing material needs an honesty makeover.

A major player in the state economic incentives “racket” is G. Brint Ryan.

Mr. Ryan is a Tax Accountant, and Founder and CEO of Ryan, LLC. Based on his earnings and the size of his clientele, one could believe he is the “Steve Jobs of Tax Accountants”—providing a superior service at a lower cost than his competitors. But that assumption would miss the ways in which Ryan has entangled himself in Texas’ corporate welfare state. Mr. Ryan has gotten rich through the force of government. According to D Magazine, Ryan’s palatial 20,000 square foot home is number 47 out of the 100 most expensive homes in Dallas, valued at nearly $10 Million.

A major part of Ryan’s practice is to secure large tax breaks and other incentives for major corporations who relocate or expand business in Texas. His practice is made possible through the staggering amount of tax breaks and other incentive programs Texas offers (more than any state in the nation).

We’ve written about these “economic development” programs before and how they amount to a slush fund for political leaders to reward the patronage of powerful interests. Ultimately, these incentives are an unfair redistribution of wealth from you and me to well-connected, organized interests. And when those interests —Ryan’s clients — win, he takes home a big share of the proceeds.

G. Brint Ryan could be aptly described as one of the major cogs in the machine known as the “Incentive-Industrial Complex,” though he is not alone. The other major parts of the machine are politicians who accept his contributions, which are vast and numerous (exceeding $4 Million over the last decade given from he and his wife personally or from his political fundraising vehicle, Ryan Texas PAC).

In your 12th grade Government class, it is likely that you learned about the concept of the “sub-government.” Nicknamed “Iron Triangles,” this is a euphemism that represents a pattern of interactions between politicians, organized interests and the bureaucracy.

The Incentive-Industrial Complex is the perfect example of an Iron Triangle. The politicians (in this case, many of the establishment are heavily favored) are lavished with significant political contributions from special interests. Organized, mega corporate interests, represented by Ryan and his type, exploit incentive programs for taxpayer dollars awarded by the same politicians. The agency that scoops-out the loot has justification for its existence, continuation, and expansion. In brief, Ryan, through his money and influence, connects megacorporations with politicians and bureaucracy to take your money.

At the heart of each incentive program’s purpose is the nebulous promise of “job creation”. For the small business owner who already employs workers and must delay or abandon plans for expansion due to a larger state Franchise Tax bill, there is no such job creation.

The inequity of these incentive programs begs the question, “Who gets the incentives and why?” For an answer, one must simply follow the money. Given Brint Ryan’s business model, following the money is a daunting task, as Ryan usually collects a handsome fee. In fact, Ryan usually gets around 30% of every award he secures for companies. These awards can be upwards of tens of millions of dollars.

For Brint Ryan and his clients, a king’s ransom; for our elected leaders—the defenders of our collective public trust—a generous bounty; for us taxpayers outside the “Triangle”—the bill.

The cronyism inherent in these programs helps generate many Texans’ outright lack of trust in government. For our government to earn the public’s trust and more wisely manage our tax dollars, the Iron Triangle of the Incentive-Industrial Complex must be broken. While it is easy to indict one or two major “cartel bosses” of the Incentive-Industrial Complex—of which Brint Ryan is one, the lion’s share of the blame rests on the politicians who create, protect, and exploit these programs.

We the People must demand that our elected representatives end all so-called economic development incentive programs that award deep-pocketed rent-seekers. It is time to end the Incentive-Industrial Complex.

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