Tennessee has a problem and its sucking the life out of Tennessee’s largest county. The problem is corporate socialism, as evidenced by an excessive 512 property parcels under payment-in-lieu of tax (PILOT) contract in Shelby County.
The excessive number of PILOTs in Shelby County is a policy product of Fred Smith’s and Pitt Hyde’s failed FedEx/Memphis Tomorrow (FMT) 20 yr. public-private complex. The product is that of idiots and that is not rhetoric, but an assertion of fact that will be proven in the below data section.
Why would the State of Tennessee continue to invest taxpayer money, that is indeed desperately needed in a Tennessee, Shelby County community in need, with the same people and failed FMT public-private complex?
In this way, in a Tennessee impoverished community in need, State of Tennessee taxpayers work to fund community betterment in Shelby County, only to have it transferred away from local Memphis/Shelby public investments, to local and foreign corporate/real estate interests that need it least !
The FedEx/Memphis Tomorrow complex is a 20 year Un-American corporate socialist experiment, that has failed Tennessee taxpayers in Memphis. And its failure, is a curriculum development opportunity ripe for History, Civics and Economics texts throughout the United States.
I am just a grassroots taxpayer advocate and I want to confront Fred Smith and Pitt Hyde, or their best bureaucrats, in public TN General Assembly Committee testimony, at which time they will be publicly destroyed.
After all, Memphis has steadily declined over 20 yrs without an external event, with the largely taxpayer funded FMT complex, down in all of their selected community betterment categories. How is that even done, unless it is intentional ?
Lacking most in Memphis, is thought diversity, where community decline, has been normalized under the FMT complex. When using taxpayer dollars, most glaring is the lack of course correction that occurs within the elitist and racially diverse FMT public-private complex, all while the same people are rewarded for running the community into the ground.
Having worked in imperfect communities across the country, where they course correct, the general acceptance of community decline and lack of course correction in the Memphis public domain, is what garnered my attention, that something was dreadfully wrong in Memphis. The local Memphis press does not question the FMT complex nor does the public University of Memphis. In fact, the University of Memphis, under the new local Board of Trustees, in many ways, has become a planning bunker for the extension of corporate socialism.
The University of Memphis is oddly partnered with the local Industrial Development Board (IDB) in the Memphis/Shelby Economic Development Growth Engine (EDGE), where they routinely publicly endorse taxpayer losing incentives and suppress economic development policy measurement. This suppression would seem uncharacteristic of a public university exercising independent thought leadership. But, then again, the UofM Board of Trustees is representative of the failed FMT complex, where 3 of the 9 Board members have direct connections to FedEx.
Additionally, The UofM is partnered with Greater Memphis Chamber of Commerce, The Memphis Shelby Crime Commission (MSCC), the anonymous donor created Daily Memphian press publication and of course FedEx. The MSCC, in partnership with the UofM Public Safety Institute, recently failed to produce any police use of force data, which was part of their data driven policing charge.
With the former partnerships, public university thought leadership for societal betterment, is seriously compromised if not impossible. And if that is not enough, the UofM recently bullied local taxpayers, in an impoverished Memphis community in need, out of $5M for tennis courts and swimming pools.
As for local public officials, which includes the Shelby County Legislative Delegation, they accept all that they have known, for the past 20 yrs, in community decline. Living in a bubble and institutionally sheltered from reality, local leaders know Fred Smith and Pitt Hyde as economic development “visionaries”. Smith and Hyde are not even revisionists. Their complex has routinely failed to course correct over the last 20 yrs.
Similar to the Crump Machine of days gone by, The Elitist FMT complex consists of a web of public-private nonprofits and boards to include the local social justice apparatus. Hijacked by the elitists, the overamplified Memphis social justice complex, seems to have been used to divide taxpayers along racial lines, while the corporate elitists undermine the local tax base and tactically weaponize social justice efforts against a majority Black community in need through failed economic progress.
While there are exceptions, anchored by the National Civil Rights Museum, the Memphis establishment social justice complex is, for the most part, pageantry and a tourist attraction. Its a failed complex that should be disregarded in the consideration of public policy. The problem is not systemic racism in Memphis, as is often touted, but runaway corporate socialism carried out by a closed, elitist and racially diverse public-private complex. Its just like the old Crump Machine, but much more racially diverse.
The focus should be on the taxpayer. And to that extent, without taxpayer justice, in a majority Black community in need, there will be no social justice.
And again, according to the State of Tennessee Comptroller report, Shelby County has 512 parcels under PILOT contract, with other Tennessee municipal counties in Davidson at 35 contracts, Hamilton-37 and Knox-68. PILOTs are supposed to incent increased wage growth through job creation and attracting new residents.
One would think, with 512 PILOT contracts, Shelby County growth would be off the charts when compared to the other Tennessee municipalities. But that is not the case. Let’s review the data to see the failure of corporate socialism.
The Data of Corporate Socialism
The above 2010-19 table, sourced from the United States Bureau of Labor and Statistics (BLS) Quarterly Census of Employment Wages (QCEW) program, shows Shelby County with 512 PILOT contracts, trailing all Tennessee municipal counties in every economic development category.
To be fair, the following data observations will be benchmarked against Knox County, which is a respectable third in Tennessee municipal economic performance, to arrive at deficiencies in public investments, that come as a product of corporate socialism.
Small Business. For starters, corporate socialism has stifled commerce in Shelby County. While unfortunately, pro-corporate policy is often mistaken, in political circles, as being pro-business, that is not always the case. Most telling, is the number of business establishments per 1k population in Shelby County with only 23.
With most establishments as small, Shelby County lacks the small business horsepower to drive competitive economic progress. Had Shelby County had Knox’s 28 per 1K business establishments, that would equate to 4,600 more small business establishments. Assuming 10 employees per small business at $50K in wages, that would equate to 46K more employed and $2.3B more in local annual wages. The $2.3B fully accounts for the deficiency in total wage growth of 10% at Shelby County’s 29.7% compared to Knox’s 39.9%, while using base 2010 total Shelby County wages of $22B.
Assuming 3% of wages makes it back into public coffers, $2.3B in deficient wage production from the small business sector, is $69M per year. And considering the $50 of $100M in excessive annual tax incentives, since 2010, while prorating the $69M per year down by 50%, within an improving business cycle, that would equate to $760M in deficient local Shelby County public investments. Deficient public investments erode the societal framework in which commerce thrives.
Employment. Employment growth was slowed in Shelby County by a botched workforce development system under the FMT complex. The botching was further enabled by the Tennessee Higher Education Commission’s (THEC) poor oversight of the LEAP Grant in 2014-16. The failure of the grant to deliver for Tennessee taxpayers was later revealed in the Complete Tennessee: Room to Grow Report.
The report stated that in the Memphis Region, “Institutions voiced concerns about understanding the region’s labor market priorities.” That was a core deliverable of the LEAP grant that never has materialized. As a consequence, a botched and disconnected workforce development system remains, under the FMT complex of Smith and Hyde.
Had Shelby County had Knox County’s employment growth, that would have equated to 15,921 more filled jobs and at $50k per year, $796M more in annual wages in 2019. Between 2010-19, prorating down the $796M in wages by 50% per year, that would equate to $3.6B more in wages and $108M more in local tax coffers.
Total Wages. In isolation, total wages is an aggregation of all of the above variables. Small business and employment growth were reviewed more closely, because they are the core contributors of the sluggish Memphis economy.
At the same time, had Shelby County had Knox’s wage growth of 39.9% and starting from a base of $22B in total annual wages, that would have been $10B more in wages from 2010-19 and $300M more in tax revenue. Add the $450M in excessive incentives that occurred in the same period, and the result is a $750M local public investment deficit.
Conclusion
Since 2010, with $750M in deficient public investments, regardless of what the FMT complex may roll out, the public destruction of corporate socialism is on full display and will take years to overcome if at all.
To that extent and since it is not going to come from other Memphis sources, an assertive dissenting view of Smith and Hyde’s failed experiment and public destruction needs to be formally put on the Tennessee General Assembly Legislative record. I would like to put the former on the legislative record, at which time the FMT complex will be permanently destroyed.
After all, history says the Crump Machine was brought down at the State level. The FMT complex, in many ways, is just a reincarnation of the elitist Crump Machine, which is all that Smith and Hyde really know. And besides, based on Blackjack Smith’s advice, one needs to leverage history to make their case. And, with the above, the case is profoundly made, while leveraging history, against Smith and Hyde’s corporate socialism.
On the record legislative testimony will provide support for the update of curriculum materials for History, Civics and Economic texts throughout the country, to document the failure of Un-American corporate socialism. Its a failed system that continues to defecate on Tennessee taxpayers today and should be immediately destroyed.
I hope to see you in the 2021 legislative session.
