IBM probably spends more than $35,000 a year on ballpoint pens and paperclips. So does anyone really believe that the city of Boulder landed a new IBM service center, and the 500 jobs that go with it, because of $35,000 in tax "incentives" it will give the company?
The Boulder Daily Camera seems to believe it, judging from its diligence in drawing these causal connections. "IBM gets $35,000 business incentive from Boulder, will add 500 jobs," reads the headline. And Boulder city officials may also choose to believe it, since it would seem to justify this obvious misuse of public money. But does anyone else really, truly, honestly believe that a corporate behemoth like IBM made this decision based on a penny-ante $35,000 handout from the city?
You'd have to be a PhD to believe anything so far-fetched.
The company has been a presence in Boulder for years. It actually has a "campus" there. It made this move based not on a measly $35,000 in tax rebates, but because it makes compelling business sense, unrelated to this payment. The company apparently is shameless enough to take "free" money when "free" money is offered: the widespread bidding for jobs with public funds has created a mercenary culture inside too many board rooms. But no sensible person would in this case connect one event with the other.
I'm not saying "incentives" never matter. In some cases, they may make a difference, at the margins. But other factors still matter more -- like the fact that IBM already has a campus in Boulder. Corporate executives have become very shrewd about collecting "incentives" for choices they would probably have made without them.
If folks in Boulder want to believe that this $35,000 offering played a pivotal part in the decision, and congratulate themselves on their economic development prowess, who's going to pop their big green balloon? Certainly not the top brass at IBM, who are laughing about this all the way to the bank.
Showing posts with label economic incentives. Show all posts
Showing posts with label economic incentives. Show all posts
Tuesday, December 22, 2009
Thursday, December 18, 2008
The National Freeloader's League
It must be serendipity. Or maybe it's just confirmation of how completely out-of-hand and shameless the corporate welfare racket has become. But on the very day that I tee-off on the corporate welfare whores in high tech (see previous post), this story appears in the Kansas City Star, explaining how the Kansas City Chiefs are scalping the taxpayers in a $25 million "deal" that will bring their summer training camp back to the state from Wisconsin, where it's been held since 1991.
Given all the other taxpayer handouts that the millionaires who own and play in the league receive -- including, most egregiously, the public financing of football stadiums -- perhaps the letters "NFL" should stand for National Freeloader's League, rather than National Football League.
Yes, the Chiefs also are chipping in for practice facility upgrades. And yes, bringing the team closer to home will please fans, provide an economic boost for St. Joseph and (perhaps) help the franchise with slumping ticket sales. So what? None of this justifies dragging taxpayers -- many of whom couldn't care less about the Chiefs, can't afford to see a game in person and may even root for the Broncos -- into the "deal." The team owner stands to benefit far more from these changes than the average football fan does. He or she should foot the bill entirely.
It's a private, profit-making enterprise that has no business reaching into the citizen's pocket. Yet shrewd characters in the team's front office, working with wheeler-dealers on the Missouri Development Finance Board, shamelessly exploit fan loyalty and sentiment to orchestrate the shakedown. And it isn't the first time the Chiefs have scalped the taxpayers. "These new projects are in addition to the renovation work already under way at Arrowhead and Kauffman stadiums," notes The Star. "That $575 million project won $50 million in state tax incentives in 2006 and is financed primarily by a voter-approved sales tax."
All involved, including the gullible fans, ought to be ashamed of themselves.
Given all the other taxpayer handouts that the millionaires who own and play in the league receive -- including, most egregiously, the public financing of football stadiums -- perhaps the letters "NFL" should stand for National Freeloader's League, rather than National Football League.
Yes, the Chiefs also are chipping in for practice facility upgrades. And yes, bringing the team closer to home will please fans, provide an economic boost for St. Joseph and (perhaps) help the franchise with slumping ticket sales. So what? None of this justifies dragging taxpayers -- many of whom couldn't care less about the Chiefs, can't afford to see a game in person and may even root for the Broncos -- into the "deal." The team owner stands to benefit far more from these changes than the average football fan does. He or she should foot the bill entirely.
It's a private, profit-making enterprise that has no business reaching into the citizen's pocket. Yet shrewd characters in the team's front office, working with wheeler-dealers on the Missouri Development Finance Board, shamelessly exploit fan loyalty and sentiment to orchestrate the shakedown. And it isn't the first time the Chiefs have scalped the taxpayers. "These new projects are in addition to the renovation work already under way at Arrowhead and Kauffman stadiums," notes The Star. "That $575 million project won $50 million in state tax incentives in 2006 and is financed primarily by a voter-approved sales tax."
All involved, including the gullible fans, ought to be ashamed of themselves.
Wednesday, December 17, 2008
High-Tech Corporate Whores
I almost hesitate to write unflattering things about Google, given its Big Brother-like power as the world's most popular search engine -- and its NSA-like ability to monitor what we're all up to on the Web. It very kindly provides the template and system on which this blog operates, all for free. So if this blog suddenly vanishes tomorrow, and they find my body floating in the Arkansas River, you'll know where to look for suspects.
But it still has to be said, even if it gets me blackballed by a great search engine: Google is a shameless corporate whore that is ripping off the taxpayers. And it's not alone among highly-profitable high-tech companies. While most of the nation is debating whether to throw a lifeline to an old-style "heavy" industry based in Detroit, and focused on the shameless pleadings of Big 3 CEOs, Silicon Valley and the high-tech sector are also taking taxpayers to the laundry -- though quietly and stealthily, by calling the handouts "incentives" instead of "bailouts."
Google, for instance, though it recently made news by turning down a $4.7 million grant from the state of North Carolina, to help the company build a new data center in the town of Lenoir, still has commitments from the state for an "incentives package" worth more than $260 million, in electricity subsidies, sales tax exemptions and property tax waivers. All for agreeing to do business in the state. Read the complete story here.
This obviously isn't a company in trouble. Google is a highly profitable enterprise that could and should pay its own way. But like many American companies, Google can resist anything but temptation -- which means it isn't going to turn down the money states and localities are throwing its way, in a cutthroat bidding war for economic development and jobs.
These company-pouching activities create the illusion of "job creation," when, in fact, they're only moving jobs around the map, based on who is willing to pay more in corporate bribes. This does nothing to grow the economy as a whole. It fosters a mercenary mindset in corporate boardrooms, state legislatures and city halls, all across the country. And worst of all, it's exploitative of taxpayers, who ultimately foot the bill for these corporate welfare payouts.
But not all North Carolinians are thrilled about subsidizing one of the most successful companies in the world. "The Google incentives are being challenged in state court by the North Carolina Institute for Constitutional Law, which alleges that special breaks for the company violate the state constitution's requirement of fair and equitable tax treatment," reports the AP.
Few such objections are being heard in Tennessee, however, where Hemlock Semiconductor (an interesting name) just received a total of $200 million in state and local "incentives" to relocate to the town of Clarksville (read the whole nauseating story here.) Nor is much of a fuss being made in Utah, where eBay, the very successful on-line flea market that keeps me supplied with second-hand shirts, just shook down taxpayers for $27 million in "incentives," in order to bring a computer center to the Salt Lake Valley.
In fact, such corporate welfare scams are endemic today. If you doubt it, follow this link to the archive of "corporate welfare"-related news stories posted at LocalLibertyOnline.org. It will blow you away. And it won't stop until the taxpayers rise up and collectively say they've had enough.
Polls indicate that most Americans are wary of a federal bailout of the Big 3, and understandably so, yet these same Americans seem sanguine, and sometimes even supportive, about the corporate welfare giveaways proliferating under the guise of "economic development incentives." We'll have to overcome this sort of cognitive dissonance if we're going to get the "panhandlers in pinstripes," of all stripes, out of our pockets.
But it still has to be said, even if it gets me blackballed by a great search engine: Google is a shameless corporate whore that is ripping off the taxpayers. And it's not alone among highly-profitable high-tech companies. While most of the nation is debating whether to throw a lifeline to an old-style "heavy" industry based in Detroit, and focused on the shameless pleadings of Big 3 CEOs, Silicon Valley and the high-tech sector are also taking taxpayers to the laundry -- though quietly and stealthily, by calling the handouts "incentives" instead of "bailouts."
Google, for instance, though it recently made news by turning down a $4.7 million grant from the state of North Carolina, to help the company build a new data center in the town of Lenoir, still has commitments from the state for an "incentives package" worth more than $260 million, in electricity subsidies, sales tax exemptions and property tax waivers. All for agreeing to do business in the state. Read the complete story here.
This obviously isn't a company in trouble. Google is a highly profitable enterprise that could and should pay its own way. But like many American companies, Google can resist anything but temptation -- which means it isn't going to turn down the money states and localities are throwing its way, in a cutthroat bidding war for economic development and jobs.
These company-pouching activities create the illusion of "job creation," when, in fact, they're only moving jobs around the map, based on who is willing to pay more in corporate bribes. This does nothing to grow the economy as a whole. It fosters a mercenary mindset in corporate boardrooms, state legislatures and city halls, all across the country. And worst of all, it's exploitative of taxpayers, who ultimately foot the bill for these corporate welfare payouts.
But not all North Carolinians are thrilled about subsidizing one of the most successful companies in the world. "The Google incentives are being challenged in state court by the North Carolina Institute for Constitutional Law, which alleges that special breaks for the company violate the state constitution's requirement of fair and equitable tax treatment," reports the AP.
Few such objections are being heard in Tennessee, however, where Hemlock Semiconductor (an interesting name) just received a total of $200 million in state and local "incentives" to relocate to the town of Clarksville (read the whole nauseating story here.) Nor is much of a fuss being made in Utah, where eBay, the very successful on-line flea market that keeps me supplied with second-hand shirts, just shook down taxpayers for $27 million in "incentives," in order to bring a computer center to the Salt Lake Valley.
In fact, such corporate welfare scams are endemic today. If you doubt it, follow this link to the archive of "corporate welfare"-related news stories posted at LocalLibertyOnline.org. It will blow you away. And it won't stop until the taxpayers rise up and collectively say they've had enough.
Polls indicate that most Americans are wary of a federal bailout of the Big 3, and understandably so, yet these same Americans seem sanguine, and sometimes even supportive, about the corporate welfare giveaways proliferating under the guise of "economic development incentives." We'll have to overcome this sort of cognitive dissonance if we're going to get the "panhandlers in pinstripes," of all stripes, out of our pockets.
Subscribe to:
Posts (Atom)