Sunday, September 11, 2011

Corporate Sponsorship or Government Hand-outs: What Side of the Fence Are You On?

I am a fair weather person and had it been our typical Fall-type Saskatchewan weather, I probably wouldn't have ventured down to the Broadway Street Fair.  But, because it was sunny and warm, we (me, my wife, 4 1/2 year old daughter and 14 month old son and the neighbor and her 3 year old daughter) walked down and spent a couple of hours wandering the streets.  We initially went to see the belly-dancers--should have checked the schedule as we got to their venue just as they were year!!!

Our first stop was at a vendor who makes and sells hanging puppet stages.  As she was a friend and because I love Twitter, I took a photo and posted it.  Then (oh social media what would I do without you?), heard back on Facebook that a buddy was about to start playing with Stephen Maguire across from 7-11.  I suspect that the Stephen Maguire fan demographic is typically not 4 1/2 year old girls...but, my daughter has been a fan of his ever since he coached her soccer team last summer.  So, I had more than one reason to venture over to hear some of his set.

While there I noticed the signage on the back of the stage "PotashCorp" and I began to think of the frequency with which I've heard that name these past few months...and these past few days.  Frequently, there are notices of the donations made by PotashCorp.  They also sponsored a Fireworks Festival a couple of weeks ago and, here again, they were involved with the Broadway Street Festival.

Now, if it were up to some political factions in this province, they would see the taxation rate of PotashCorp increase.  Potash, they say, belongs to the people of this province and if any company wants to mine OUR resource, then they had better be prepared to compensate US--dammit.  And that may be true...but, let's think about the difference in values.

If you tax more to "give to the people" then you believe that government knows best and that money goes to the people the government decide need it.  Would it be given to everyone equally?  Or would it be given to those who are deemed to have less?  Good questions.

If you believe that we should leave profits with the companies then you have what we've seen this summer.  Fireworks Festival and Broadway Street Fair--now, in the case of the Broadway Street Fair, it may have happened without corporate sponsorship or not due to the involvement of the Broadway Business Improvement District...I don't know...but with the Fireworks Festival...well, if there was higher taxation, would PotashCorp have spent that money?  How much better is the Broadway Street Fair when corporations have money to kick in to attract top notch entertainment?

To be fair, when I first heard the booming fireworks I thought, well looks like someone is making a bunch of cash...must be nice to frivolously spend like that.  But, upon further reflection, in addition to the civic pride that it gives I began to think--how many folks were out that evening spending money?  And, in the case of the Broadway Street Fair--how many self-employed folks had the opportunity to showcase their wares:  art, crafts, music, food?

For the record, no one in our party ended up buying the puppet stage, but we did get a couple of hand-made bracelets, a headband, some popcorn and a couple of Smokies from the Bulk Cheese Warehouse.  I believe there are folks who generally need a helping hand, but I applaud every person out making a living this past weekend.  I am happy to spend money locally in this manner and I am happy to see corporations spend their money sponsoring these events.  I hope the next years in Saskatoon see many more summers full of fireworks.

The economic benefits of lower taxation affords the opportunity to self-starters--to those who are already trying to make a go of it--artisans, musicians, restauranteers, entrepreneurs.  Higher taxation ensures that "the poor" will receive funding for being "poor" which continues the cycle of government dependency.  Don't we want to foster independence, creativity, entrepreneurial spirit?  What does that better--government handouts, or additional business sponsored events that give venues and opportunities to additional "spin-off" businesses?

This post is up for discussion.



  1. I think that PotashCorp only is one example of a good corporation giving back to the community while not being as heavily taxed as comparative businesses. The sample size is too small to be able to say that we need to drop taxation across the board.

    There is also a post hoc ergo propter hoc fallacy in here. You suggest that PotashCorp gives simply because they have more money to use. However, perhaps it is the very fact that there is pressure to tax them more, that they are contributing in such a way. There is a correlation between altruism and lower taxation, but that does not mean that the lower taxation is the cause.

    I am curious as to your use of quotes around the poor. I think you also need to provide more data to back up your suggestion that giving funding to the poor continues a cycle of government dependency.

    You also close with a false dichotomy. I find false dichotomies to be particularly troublesome, especially in today's politics. Too often we are presented with two options, and are told to chose between them, even though those are not the only two options.
    The options are not limited to handouts and additional business-sponsored events.

    Be skeptical, not susceptible.

  2. The post wasn't advocating dropping taxation; rather it was advocating NOT raising them.

    I would also take issue with your suggestion that there is "pressure" to tax them more. The only pressure is coming from the NDP who conceivably might not win a seat (okay, I exaggerate slightly, but they certainly won't form government). If anything, they are more motivated to contribute locally to prove their worth so that they are seen as invaluable and not again faced with a hostile takeover. Or, alternately, they are just responsible corporate citizens...or some combination. Whatever the "cause", if the correlation between altruism and lower taxes exists...wouldn't we want lower taxes?

    You say "false dichotomy" I say exaggeration to prove a point. Yes, some people will always require assistance--and the government needs to be involved--however, I believe that more individuals need to take responsibility for their personal circumstances and take initiative...if corporate sponsorship affords venues to aid in that, then I'd much rather see that than increased taxation.

    I do appreciate your thoughtful comments.

  3. Brandon

    I'm in total agreement. The taxation of Corporations is not a viable method to encourage contribution to the landscape of society. Your example of Potashcorp has been thus far well received around Saskatchewan as they have definitely been on a PR campaign as of late. There attempts to appear as a good corporate citizen is I feel self serving though. The purse strings only opened wider due to the increases pressure of others appearing on their playing field such as BHPBilliton. This is simply the PotashCorps attempt to keep the feared competitors such as BHPBilliton from encroaching on the field.

    As you mention some political parties wish to "Steal Back" a share of the wealth created through increases in royalties and higher taxation.
    I say "steal" simple because that is what it is when government sell's something then turn around take the profits back through increasing taxation just because they can. The person you sold it to has invested there time, efforts and financial resources into the development they deserve the profits. The idea of changing the rules after sale is like selling your car to someone then expecting to drive it again. If there were any truly free thinkers in those parties their heads would be spinning.

    Society receives voluntary contribution when it is not imposed and competition exists. Increasing taxation will result in the voluntary contributions drying up. The more competition the better. Increases in taxation and regulation serve one purpose that is to make corporation's look elsewhere.