Here’s Why Philly Businesses Will Gladly Pay Millions for the Pope and DNC
(This post originally appeared on The Philly Post)
Fact: If the Democratic National Committee decides to hold its 2016 convention in Philadelphia the cost could range anywhere from $50-$75 million dollars. While the federal government would pick up most of this cost, as much as $10 million could fall on our local government (at least, that’s what New York’s mayor predicts if the convention came to his town).
Fact: When the pope visits Philadelphia in 2015 as part of the World Meeting of Families theestimated cost could be another $13 million, (the city of Milan paid 10 million euros when it hosted the event in 2012).
Fact: $10 million plus $13 million means the city could be on the hook for up to $23 million in additional expenses for these two events. Maybe even more.
Fact: It’s likely that Philadelphia’s business community will step up and raise the money to pay this bill so that taxpayers are not out of pocket. “We’re the fifth largest city in America,” Comcast’s David Cohen recently said in a radio interview. “And I think our civic leadership has the capacity to be able to raise the money to host these two pretty special events in consecutive years in Philadelphia.”
Great! The city needs $23 million, and the business community will likely step up.
Fact: Per the New York Times: ”Philadelphia’s cash-strapped public schools will open on schedule after $32 million of budget cuts, easing fears of closures or a late start to the school year to save money. Calling the budget cuts the “least harmful” option, Superintendent William Hite said the cuts would require the district to scale back on cleaning and repairs, leave current police vacancies unfilled and halt bus transportation for high school students who live within two miles of school, affecting about 7,500 students.”
Rats! The school district needs $32 million and there’s no money to be found.
Conclusion: Philadelphia’s businesses can come up with the money to pay for the pope’s visit and a political convention, but not for our city’s schools. They just don’t care about our children.
That conclusion is wrong.
David Cohen certainly isn’t worried about raising a mere $23 million for these two special events. And why should he be? Comcast alone had almost $3.9 billion in cash and short term investments on its most recent balance sheet. Penn’s endowment was $7.7 billion at the end of June 2013. American Airlines, who operates an enormous hub here, ended last quarter with over $10 billion in cash. A mere $23 million is peanuts. Actually, a mere $32 million to fund the schools is petty cash. In all probability these three organizations probably just spent $32 million on paper clips as I was writing this piece!
So why are they ignoring the serious problems that face our city? Why is it so much easier to get them to pay for the pope’s visit and a political conference than to rescue our failing school system where kids’ lives are stake? Are they callous? Insensitive? Heartless?
No. The people running these companies have a fiduciary responsibility to their shareholders. And they would be out on the sidewalk if they committed a serious amount of these entrusted funds to Philadelphia’s school district.
Funding the pope’s visit makes sense. Being associated with the pope is good PR. He is a good man doing good things. And besides, there are millions of potential Catholic customers in the expanded region. Hillary is no pope, of course. But she and her party do represent somewhere around 40% to 50% of the voting public in the U.S. who are also potential customers. Showing support for the party in power, and who may remain in power for another four years, could result in favorable legislation for their business. This is not about community, charity or altruism. This is money being spent to bring in positive publicity, improve political relations, and make things better for doing business. This makes sense.
Investing in Philadelphia’s school system for these companies doesn’t. Of course they are concerned with the future of these children. Of course they know how important an investment in education is. But these are business people who make sound, reasonable investments. And they see a system that is bankrupt and driven into the ground by unfunded pension obligations and impossible capital requirements. They see a district whose enrollment, according to a state think tank, has shrunk in size by almost 25% in the past 10 years yet whose budget has increased 50% in order to meet these long-term obligations. A system that is mismanaged by politicians who are too weak to make the hard choices on unions, pay, and retirement and health benefits that we all know should be made and whose only answer is to beg for more taxpayer money instead of making the hard decisions that a company executive would make. For Comcast, Penn, American Airlines and all the other large companies in the region, paying for the Pope and the DNC makes sense. Giving money to a broken system does not.
So let’s all be reminded of this fact: The school district’s money problems are very solvable. Our politicians, union leaders, and school district administrators don’t need to keep coming back to the taxpayers for more of it. There is plenty that is privately available to solve the school district’s problems. And I do believe that our corporate leaders would step up and help right the school system, just like they’ll likely fund the 2015 papal visit and 2016 convention. But they aren’t going to make those investments unless bigger and harder internal changes happen first.