Bailout fever is sweeping across the country. As the economy has slowed, the amount of businesses with their hand out to the government asking for taxpayers’ dollars has increased exponentionally. Well, it has now come to Schuylkill County. On Wednesday, the county Board of Commissioners will vote on whether to guarantee nearly $6 million of Gov. Rendell’s $35 million loan to bail Boscov’s Department Stores out of Chapter 11 bankruptcy.
I like Boscov’s. I really do. However, in year where the county budget is in a shortfall, county employees are getting demoted from full-time status to part-time to save money, and the pension fund lost tens of millions of dollars, I don’t know where Mantura Gallagher and Frank McAndrew think they are going to get the funds to cover this loan.
Oh wait, yes I do . . . . raising our taxes is on the table. I forgot.
We live in a free market society for a reason. Our economic system is built the idea that if you have a great idea, it will make money and if you make good business decisions, you will prosper. Conversely, if you have bad ideas and make bad business decisions, your business will suffer. Boscov’s has made some bad business decisions over the past few years. They are now paying the price for it. When the government starts throwing money at failing businesses to prop them up because they are “important”, we cease being a free market society by quickly becoming more socialist.
This will be a difficult concept to pound into the heads of local politicians since nearly all of them have taken campaign money from Albert Boscov. However, one of the larger receipients of Boscov’s donations has already come out against using government dollars for this bailout. Truthfully, I couldn’t believe it when I read it either.
Rep. Dave Argall (R-124), GOP candidate for state senate, said about the bailout, “At my town meetings in Schuylkill and Berks counties last month, the people who brought this up and I were in agreement over the basics: Our wish for Mr. Boscov in 2009 is that he is successful in saving this important business . . . we hope that he can do it WITHOUT the need of expenditures of public funds.”
I truly hope that Boscov’s can stay afloat somehow during these lean times and rebound in the coming years. God knows, Schuylkill County can’t afford to lose another retail store or the jobs that come with it. But, it shouldn’t be on the public dime.
11 Comments
January 5, 2009 at 2:48 pm
Someone please tell me that this is some kind of sick joke.
I think that this will be the “pay raise” type of issue that gets those two commissioners voted out. Mark my words, we’ll be hearing about this when they run again. I can see the mailers & hear the radio ads already.
January 5, 2009 at 7:00 pm
Yes I agree we shouldn’t be giving 6 million dollars to help with the bailout we have enough of our own problems in this county and shortfalls with in the budget.
The money could be better spent. What happens if they approve this plan and Boscov’s tanks?
Then the taxpayers are out 6 million dollars I disagree with this plan and I think our voices need to be heard. Al Boscov needs to take care of his own problems just like so many of us do who have finical difficulties. I don’t see the Commissioners bailing out average Joes.
I encourage people to attend the Commissioners meeting on Wednesday and speak out against this plan.
January 6, 2009 at 3:24 am
I must tell you that Snyder Co rejected this last week.
There is now controversy.
If it is risk free, then why wont the bank back it? Let the lawmakers use their own personal household wallet for this. (and not mine)
January 6, 2009 at 2:20 pm
This will pass with ease. Republicans and Democrats have voted for much worse over the years. It’s a shame. All of our county’s politicians have voted for very bad bailouts. All of them. I don’t expect it to stop now.
January 6, 2009 at 8:31 pm
1. I think it should be pointed out that this will be money funnled from the federal bailout, into the state fund and thusly into a local economic development grant administered by the Counties. I think Hank should apologize for either being misinformed about this or implying that it was expressly county tax dollars. What’s more, Commissioner Staud. is a voting member on this as much as Commissioner McAndrew- so let’s stop the intentional omissions.
There is no correlation between this and the local government budget. This money is not applicable to aiding local government budgets- as that is not classified under economic development.
This is an important distinction, because Gov Rendell has already stated Boscov’s will receive ~$ 35M from the bailout (http://www.philly.com/philly/blogs/harrisburg_politics/Rendell_on_Boscovs_bailout.html). It is my understanding that this money will be filtered to Boscov’s regardless; the question becomes, will a particular County apply for the grant money. Meaning: if Schuylkill does not do this, it runs the risk of loosing it’s local store while Boscov’s receives the money derived from the feds, anyways. The only thing I can think of as to why Snyder County has rejected the notion is (a) The Selinsgrove Boscov’s is in good shape, and/or (b) They rejected it on principle, and/or (c) Snyder County recently saw the opening of Kohl’s, Target and Dick’s.
2. If we want to talk free market, fine. But the fact is, banks and industries classified as critical have been bailed out under this stimulus package. Before that, oil companies, credit card companies and airlines companies have received heavy tax advantages- equating to the government medaling in the market by your definition, Hank. This speaks of the larger issues as to why it is a hypocrisy to say that forms of green technologies are not economically efficient- when on the converse their counterparts are being subsidized to unproportional levels. In ways, this is sin commited by both Republicans and Democrats- but let us also not fail to think this is not committed by those classifying themselves as “Conservatives” as well.
3. Boscov’s is very important locally…very. I don’t think I can stress that enough. Commissioner Gallagher’s statements of this have a rippling effect of sending shoppers- especially on the South side of the county, with an increasd purchasing power- is extermely apt. The closure of Boscov’s at the Fairlane mall could mean the eventual closure of the mall itself. Least we forget it was Boscov’s and the mall that spelled the eventual doom for downtown shopping in Pottsville. We should not allow a death of a commercial center when it is preventable.
We would be looking at the closure of almost all anchor stores in Schuylkill County, sans possibly Sears and The Bon Ton. The 155 employees are important too, but not as important of the literal death of Schuylkill County merchandising. To most I know, Boscov’s is the last place locally for most general purchasing needs and it is the last most on the Southern tier.
Let’s talk KOZ’s and additional tax abatement solutions SEDCO, et al, entice businesses to develop inside the County. This too is counter to ultra-free market ideals. As is my understanding, in most cases, those abatements go beyond 5.8 million dollars. If we allow Boscov’s to not receive this money based on ‘Conservative Free Market’ ideology; we’re simply being hypocritical.
January 7, 2009 at 12:49 am
South Skook Dem,
1. Where will the six million dollars come from in Boscov’s fails? Our budget is in shortfall NOW. County agencies are being told to tighten their belts NOW. County workers are being demoted and laid off NOW. If Boscov’s goes belly up in 9 months, how is Mantura and Ange going to pay the piper? That’s what a guarantor does, SSD. They guarantee to the lender that the loan will be repaid no matter what. How can you or anyone else look any county resident in the face and say we can take on the risk of having to pay 6 million big ones back to the state if something goes wrong?
2. Just because it has been done before, doesn’t make it right. This is the thinking of an 8 year old. My daughter was caught putting on some of her mom’s makeup the other day before school. When I told her to go wash her face, she said, “But daddy, its OK. Everyone else is doing it!”
3. It is not government’s job to prop up businesses just because they think they are important. Who are you to decide if one business goes broke over another? In a capitalist society good businesses succeed and bad businesses fail. Once government starts pre-determining which ones stay and which ones go, we cease being capitalist and become socialists. If you want a socialist system go live in China, Vietnam, or Cuba, but don’t bring your commy crap to my backyard.
January 7, 2009 at 10:09 am
I’ve agreed with South Skook Dem in the past but this time you are wrong. It is a fact. If Boscov’s fail SCHUYLKILL TAXPAYERS will lose money not the Fed or State.
January 7, 2009 at 2:00 pm
This flys in the face of free market if I contribute to these politicans will I get a bailout too! How is funding Boscov’s going to get me to spend in this store when due to the multiple excessive tax burdens place on the working Americans. I have no spare money for Boscov’s he’s already got my money its call taxpayer bailout! Commissioners say no!!!
January 7, 2009 at 3:51 pm
I love how people like South Skook Dem talk about state and federal dollars as if they were plucked off a magic tree. If the money comes from the federal gov’t, IT STILL ULTIMATELY COMES FROM US.
January 8, 2009 at 8:16 am
It’s ironic that the biggest critics of the bailout seem to be the diehard supporters of Dave Argall, the king of bailouts.
January 10, 2009 at 3:15 pm
death and taxes,
I think Argall should be commended for his opposition to this bailout. He has indeed taken a large amount of money from Boscov, yet has still sounded his rejection of it. Maybe there is still a some conservativism left in the man after all.