Thursday, March 15, 2007

Remaking A City

Mike Mills sent me an email containing this link about Google establishing a server farm in Lenoir, NC. Lenior used to be a city of furniture makers but the rise of China has out competed them and the town entered a decline. Because of this decline, unemployment rose, land values fell and the free market kicked in.

Because of these low land values and lake of people looking to become employed again, Google decided it would place a new server farm there. A server farm is basically a building full of computers that run Google programs (their search engine and so forth) all over the world.

Mike correctly stated that there's "A lot of blogrich material" in the article and that's no exaggeration. But beyond the very cool overarching theme of spontaneous order, I noted one other item I really wanted to point out:

The city offered Google some pretty sweet tax breaks to encourage them to come in. Like the only Libertarian on the city council (who was also the only one to vote against Google's entrance), I'm not too fond of special treatment. However, I also recall the words of Milton Friedman: "I am favor of cutting taxes under any circumstances and for any excuse, for any reason, whenever it's possible."

2 comments:

Timothy said...

I'm the Councilmember who voted against the deal. You don't really think taxes will be lower, do you? They'll be lower for Google, and Google only. Everyone else will pick up the slack with higher (or not reduced) taxes. The only way really to reduce taxes is to reduce spending. Remember: Democrats tax and spend, Republicans borrow and spend. The spending's going to get paid for one way or the other.

David said...

Timothy: That's an interesting point. I don't know if taxes would be raised for everyone else to make up the difference-it is far more likely that the government will simply borrow and of course this is not truly lowering taxes. Still, I would vote in favor of Google not because of any tax issue but because I think it's pretty absurd Google needs government permission to build an office in the city. (Granted, I don't know the exact circumstances of the move, some of which might include the company buying government-owned land, but on the surface the whole notion a voted was required strikes me as very anti-libertarian.)