An incentive for investment: How the US tax code can help America rebuild

There is something quietly radical about Gary, Indiana, serving as the backdrop for a national conversation on tax policy. For decades, Gary has been shorthand for post-industrial decline—a city whose population has fallen by more than half since its steelmaking peak, leaving behind vacant lots and boarded storefronts. Yet the city's current leaders have embraced a pragmatic triage: preserve what matters, adapt what can be saved, and clear away what is beyond redemption. That is not defeatism; it is honest stewardship. The question the article raises is whether Washington is willing to meet cities like Gary halfway. The federal tax code is often discussed in terms of who pays more or less, but it is also a powerful instrument for directing where capital flows. When the tax code rewards short-term financial engineering over bricks-and-mortar investment, it is no surprise that capital follows the path of least resistance. An incentive structure that favors rebuilding America's urban cores would not be charity—it would be a correction of market signals. Of course, the counterargument deserves a fair hearing. Critics of targeted tax incentives argue that they often become permanent giveaways, that they distort investment decisions, and that they can reward developers who would have invested anyway. There is a legitimate concern that "tax expenditure" is simply another form of federal spending, one that is less transparent and less accountable than an appropriation passed by Congress. The burden of proof is on proponents to demonstrate that such incentives produce genuinely additional investment, not merely reshuffled investment. What makes this story compelling is that it resists easy ideology. A conservative can support investment incentives as a market-friendly alternative to direct government spending. A progressive can support them as a tool for equitable urban renewal. The friction point is not whether America's cities deserve help—it is whether the tax code is the right vehicle, and whether the incentives will actually work. As Gary demonstrates, the problems are real and urgent. The policy debate is about the most effective solution, and that is a debate worth having. Source: https://thehill.com/opinion/finance/6055864-tax-policy-urban-revitalization/