Financial burdens and decisions
Question 1. Discuss the financial burden that the construction of the Barclays Centre has had on the public for the last 5 years.
The Barclays Centre is the jewel that adorns the town of Brooklyn. For nost visitors who have not been to the town at all, it is the utmost symbol of perfection and pride. However, a critical investigation proves otherwise. For starters, the Brooklyn Center was constructed at a cost of 1.6 billion us dollars. The figure would not be shocking was it coming from the pockets of investors. However, this is not the case because this is public money. The ramifications of such an investment are huge. Investing such money in a project whose future is uncertain is risky. This is because, the figure lead to the deduction of allocation on public health, incentives for trade and even provision of better amenities to support businesses. The outcome is that the people of Brooklyn have slowly had their business die gradually. This is because, the government incentives have been withdrawn and the competition by the new businesses in the Centre cannot be matched.
Moreover, it has emerged that the construction and the continued existence of the Centre is a risk to the environment. You may wonder where the connection is. A Centre such as this produces a lot of waste both solid and liquid. The Brooklyn River is used to dump the wastes. The river is depended upon by many locals in Brooklyn for whatever activity. The cost of cleaning the river as well as removing solid wastes is almost bankrupting the town council. There is no responsibility by the Centre to clean this mess.
Demolitions have been witnessed during the construction of the Barclays Centre. This may sound right because there is a supposedly signed affidavit between the owners and the developers. However the issue is, these people who are as many as over 3,000 have been left homeless. The cost incurred to look for alternative homes is unimaginable. To make matters worse, the Centre, has led to increase in home prices. What this does to the people of Brooklyn is stretch their pockets so much that they are left broke and desperate. In addition, the sports and events at the Centre cause huge traffic. We must not forget that the Centre is a public place hence it is exempted from taxation. The issue arises from the traffic snarl ups caused by the events and sports. The money lost through these jams is so much that it cancels out the fees from the events. This is not sustainable for Brooklyn in the long-term.
Question 2. Do you think public effect should be considered before making financial decisions?
The answer to this question is a big yes. This is because all financial decisions are made by the policy makers and managers but the last consumer is the public. Let us consider some scenarios. A firm wishes to downscale the production of a product B. It happens that the product is greatly consumed by the public but the mangers of the supply chains believe the income is less than the intended amount. The effect of this is a complete disruption of demand which leads to loss of market for the available goods. This is because, as much as profit is the core, the consumer is the reason firms stay afloat.
In another case a manufacturing company decides to import robotics and other machines. As a result, there is massive retrenchment. The community loses jobs among other incentives due to mechanization. The firm company will face hostility reflected through boycotting the products. This further proves that the voice of the public is not a thing to assume. In addition, whenever the government, through central bank decides to raise interest rates, the result is similar. People will not be willing to acquire expensive loans. The outcome of this is that banks will report the low borrowing and subsequently, the correction action will follow.
In conclusion, there are many scenarios we can give to validate the need to listen to the public opinion. The fact remains that all financial decisions are geared towards selling something to the buyers. The buyers are the public and unless they are okay with something or a policy, it is doomed to fail.