Issues to Watch: November 14 2005

As reported in the NH "Union Leader" and the "Boston Globe", the government of Maine is planning on drawing tourists away from New Hampshire, to the benefit of the Maine economy.

According to the reports, both culled from Associated Press stories, the stragetist behind this plan, a man named Rudi Nardelli, expressed the idea in this fashion:

"'If the overall market isn't expanding, the only way to increase business is to steal it from our competitors."

One has to ask a few questions about this strategy.

First, why can't the businesses reliant on tourist Dollars find ways themselves to expand the market or cut their costs? Second, why is the government involved in helping these businesses promote themselves? Third, what happens when the government does offer this help?

To answer the first question, one might easily turn to problems such as the rise in the price of gasoline and uncertainty over future prices in general as reasons the tourist market is not expanding. But experts in New Hampshire have said that the tourist market has not dwindled, that, in fact, many people are avoiding air travel and still using their cars to make short weekend trips. The problem is not a lack of potential demand in general. The problem stems from the second two questions stated above.

The presence of government as a surrogate promotions agencency for businesses associated with tourism has been accepted by Maine citizens and New Hampshire citizens for years. But, just as one can ask why NH Governor John Lynch was aboard a plan bound for Germany to promote NH businesses when the terrible rain storms hit NH in October, causing massive floods, one can ask why the Maine and NH governments are in the business of promoting tourism. How is it that we have so perveted the original justification for government, which was to prevent citizens from bringing direct harm to one's life, property or ability to use his life or property peacefully, that we now have politicians currying favor with different businesses by acting as their PR departments?

The Maine plan to "steal" tourists away from NH will fail for the same reasons the tourists already come to NH rather than Maine. Apart from geographical and logistical subtleties, the fact is that in Maine, the government costs businesses more to do their business. These costs are passed on to consumers, and comsumers respond in kind, by choosing a better path for their spending. The only way Maine can promote the selected tourist industries is to spend money on tourism promotion, money that has already been taken from businesses around Maine. The only way it can increase this PR for tourism is to spend more money taken from businesses, thus undercutting the very goal they are set out to achieve -- attracting more people to choose Maine over the lower-tax state of NH.

One does not improve the view by making it more expensive to see it.

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AndrewJames
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