In 1928, the Chamber of Commerce in Marlin, Texas, wanted a modern hotel to serve the hundreds of people who bathed every week in the town’s famed mineral waters, so they asked Conrad Hilton if he’d consider investing in their community.
Hilton replied with a proposal for a $375,000 high-rise with the largest ballroom in Central Texas and a suite of elegant porcelain bathtubs, where guests could partake in the healing waters. But first, he wanted the city to come up with the first $50,000 toward the nine-story structure, 150 miles northwest of Houston.
The chamber complied, and Hilton brought in decorators from France to create an elegant hotel in the middle of Texas cotton country.
We tend to think that economic incentives are a relatively new phenomenon, but successful companies have demanded them for centuries. When politicians’ popularity depends on economic conditions, they will do all they can to create jobs, even if it means giving away taxpayer money.
Hilton’s demand for a 13 percent down payment to build his ninth hotel makes Elon Musk’s request for a minimum10 percent contribution toward the construction of Tesla’s$5 billion “gigafactory” look reasonable.