Even Fixing Wisconsin's Foxconn Deal Won't Fix It, Says State-Requested Report (theverge.com) 168
The Wisconsin Department of Administration is requesting a reassessment of the costs and benefits of the LCD factory Foxconn is building in the state. Since Wisconsin offered Foxconn a record-breaking subsidy in 2017 to build the facility, the Taipei-based company has significantly scaled back its plans and delayed the project. The Verge reports: The report, which was conducted by Tim Bartik of the Upjohn Institute for Employment Research, finds that the smaller facility raises the already unusually high cost per job even further. If the subsidy levels in the current contract are kept, each Foxconn job would cost taxpayers about $290,000, Bartik found, compared to $172,000 if Foxconn built the original $10 billion, 13,000-job facility. For comparison, Bartik estimated the subsidies Virginia offered Amazon for its second headquarters amounted to between $10,000 and $13,000 per job. "The most important conclusion of this analysis is that it is difficult to come up with plausible assumptions under which a revised Foxconn incentive contract, which offers similar credit rates to the original contract, has benefits exceeding costs," Bartik wrote. "The incentives are so costly per job that it is hard to see how likely benefits will offset these costs."
While Bartik produced the memo in response to a request from the Wisconsin Department of Administration, he notes that it was produced independently and that its conclusions do not necessarily reflect the views of the department or the Upjohn Institute. He doesn't know whether Gov. Tony Evers has been briefed on his report, but he says he shared it with Mark Hogan, the head of the Wisconsin Economic Development Corporation, who objected to its conclusions. Hogan, who served under Evers' predecessor Scott Walker, said in a statement that the current contract protects Wisconsin taxpayers. "This study makes assumptions that could not occur under the existing 'performance-based' contract between WEDC and Foxconn. The plain fact is the company would not be able to retain any incentives if, by the year 2023, it had only created either the 1,500 or 1,800 jobs the study is based on," Hogan wrote in a statement. Bartik says he doesn't find a persuasive defense in the idea that the project has a reasonable cost per job if it goes into default, all clawbacks are promptly paid, and Foxconn still keeps 1,500 jobs in the state.
While Bartik produced the memo in response to a request from the Wisconsin Department of Administration, he notes that it was produced independently and that its conclusions do not necessarily reflect the views of the department or the Upjohn Institute. He doesn't know whether Gov. Tony Evers has been briefed on his report, but he says he shared it with Mark Hogan, the head of the Wisconsin Economic Development Corporation, who objected to its conclusions. Hogan, who served under Evers' predecessor Scott Walker, said in a statement that the current contract protects Wisconsin taxpayers. "This study makes assumptions that could not occur under the existing 'performance-based' contract between WEDC and Foxconn. The plain fact is the company would not be able to retain any incentives if, by the year 2023, it had only created either the 1,500 or 1,800 jobs the study is based on," Hogan wrote in a statement. Bartik says he doesn't find a persuasive defense in the idea that the project has a reasonable cost per job if it goes into default, all clawbacks are promptly paid, and Foxconn still keeps 1,500 jobs in the state.
Send the Bill to Scott Walker (Score:4, Insightful)
I bet when it's his money on the line he'll figure out some way to get out of it.
Re:Send the Bill to Scott Walker (Score:4, Interesting)
Or re-negotiate the subsidies so that they only apply when the company meets the targets that the state had when it offered the subsidies. If the company scales back, the subsidies get reduced or eliminated.
That would force the company to do a cost analysis of what's beneficial while determining its execution plan
Claw Back (Score:2, Interesting)
Claw back the subsidies. They wouldn't have been a good deal for the state even if the promised benefits came to fruition. FoxCON never intended to live up to their end of the deal in the first place; all they wanted was a free factory. Claw 'em back!
Re:Claw Back (Score:5, Insightful)
Add Wisconsin to the states FUCKED by trump (Score:1, Informative)
So that's trump's economy for you. BRING TEH JERBS BACK! No, go smoke another pipe full of meth you gullible crayon eating red state dimwit.
Collectively trump voters are dumber than a bag of hammers to have believed his lies.
Re:Add Wisconsin to the states FUCKED by trump (Score:5, Insightful)
So that's trump's economy for you. BRING TEH JERBS BACK! No, go smoke another pipe full of meth you gullible crayon eating red state dimwit.
Yep. Trumps "job creation" scheme is based on giving companies/corporations free money. Over a trillion dollars per year in the for of tax cuts.
ie. It's taxpayer money. Guess what's going to happen to all those jobs when the scheme collapses? Guess what state the economy's going to be in after a few more years if racking up trillion dollar deficits? Guess which party is going to have to try and fix the mess (Republican??). Guess which party will take the blame for the "miserable years" that it will take to fix it ("Remember the Trump years when everybody ha d a job"?).
The USA is fucked thanks to the giant orange Ooomps Loompa they elected.
PS: How's the Swamp Draining(tm) going?
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The Two Santa Claus Theory is still working great.
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PS: How's the Swamp Draining(tm) going?
Oh that went well. The swamp is gone. We replaced it with waste water sludge settling tank piped directly to everyone's toilet. Oh what? Clean water? We never said that. We only said we'd drain the swamp, no one actually bothered to ask what we would do with the space once the swamp was gone.
Re:Add Wisconsin to the states FUCKED by trump (Score:5, Informative)
I warned the same people that giving Kestrel money was not a good idea until they had a far more "solid" project aircraft and were further down the pipeline toward construction. The aircraft business is rough in the best of times, and I know that one personally as well.
Still they all happily gave money, then tossed good money after bad, because the Walker/Vos/Fitzgerald WEDC said they were good bets. Anyone who wasn't a blind moron, who had even a passing ability to read and 8th grade comprehension/logic knew these were high risk (as in current Powerball odds risk) deals. Kestrel because of the state of the small aircraft industry, and Foxconn because the only thing they're consistent about is breaking deals.
So keep up with that "Both sides are bad (so vote Republican)" bullshiat. These were horrible deals, and the Republican led Senate and Legislature have tried to insulate themselves from criticism by making it harder for Evers to appoint people to the WEDC (through their lame duck legislation) who could then print some pretty nasty reports about how much taxpayer money Walker, Vos, and Fitzgerald lost through ineptitude or corruption, take the one you like better: Walker, Vos, Fitzgerald, and the Republican led WEDC were either hopelessly inept or criminally corrupt in decision-making.
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This is just stupid partisan nonsense... both Democrats and Republican governments make these sort of incentive deals to get companies to locate businesses in their states... and many times they don't work out. Which is why they usually have tiered incentives and clawbacks if the state actually spends any significant amount of money... which in this case it appears the deal just fell apart so there isn't really much to be concerned about.
I get it... Trump and Republicans get to hold a press conference when announcing the deal, so the Democrats and whomever get to talk smack when it doesn't happen. But corporate tax subsidies are just part of competing for businesses and all states and all parties do it and there was no real harm done.
BSABSVR amirite anonymous coward?
Let's be brutally honest here, this deal was panned for good reason. Foxconn had a track record of breaking deals. They are also known for fighting clawbacks, and are very good at keeping money. Every US municipal, county, and state government that has dealt with them has panned their compliance and their attitude. How many warning signs did the Republicans need this was a terrible idea? Did they need it stamped onto their foreheads? Who in the f**king h*ll thought, for one picosecond, that Foxconn would honor the deal and not try to cheat or change the terms? The answer is simple: Only idiots or corrupt people. Call it partisan all you like, but the only partisan here is you for defending either staggering incompetence or utter corruption.
Now Kestrel is more forgiving, until any businessperson looks at the state of the aircraft industry for small planes. The field is particularly brutal to new players, with most going bankrupt, and has only gotten more brutal since 2000. Even longstanding player Hawker/Beechcraft was absorbed by Textron/Lycoming/Cessna. I mean, if you have even one iota of business sense you know the old joke how to make a small fortune in the aircraft manufacturing business: Start with a large fortune. Only someone with a complete lack of business sense, which apparently defined what was needed to get appointed to the WEDC, would consider investing in an early aircraft startup a smart idea. I mean, this isn't new or remotely obscure business knowledge.
Take your partisan defense of the indefensible up a notch anonymous coward. I get it, you need to defend this because otherwise your team looks like they're idiots or corrupt.
You mean Trump's promises.. are moot? (Score:1)
You need a professional subject changer like Donald Trump to walk away from promises like that, no looking back unless you're going to accuse Obama of something whattaboutable. Who's paying this time, Mexico again?
Or China, paying the US import tariffs that Americans won't actually pay, but are, actually, paying?
#Stable Genius lies in the hay all day
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Republicans bad. Democrats good.
Re:Please post groupthink below (Score:5, Informative)
Republicans bad.
The Wisconsin Republicans are the scumbags who defied the will of the voters by using the lame duck session after they lost the 2018 elections to limit the powers of the Governor and the state Attorney General so yes, Republicans bad.
This piece explains it. [nbcnews.com]
... Democrats good.
Oh, there's your problem. You have been suckered into only having two choices, instead of the many choices proper democracies have.
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"Oh, there's your problem. You have been suckered into only having two choices, instead of the many choices proper democracies have."
Passive voice is used here as a means of blaming the victim.
What happened here specifically is that the founding fathers completely failed to even mention political parties in the Constitution, and they have run rough-shod over democracy ever since. They supposedly didn't mention them in the hope that they would simply go away, which is laughable on every level.
Kids with modpoints (Score:2)
You don't seem to understand that the Foxconn deal was partisan politics, so a discussion of political parties at the federal level could not possibly be any more on-topic.
Moderation on Slashdot is broken by design.
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"Oh, there's your problem. You have been suckered into only having two choices, instead of the many choices proper democracies have."
Passive voice is used here as a means of blaming the victim.
What happened here specifically is that the founding fathers completely failed to even mention political parties in the Constitution, and they have run rough-shod over democracy ever since. They supposedly didn't mention them in the hope that they would simply go away, which is laughable on every level.
Political parties are mentioned a bit in the federalist papers which the supreme court often use to render judgements. George Washington was actually well known for disliking political parties and was very against them, only giving in because it became a necessity. The problem is, you have the right to assemble. Government can't restrict that and a political party is the ultimate way to assemble.
The real solution isn't getting rid of parties but taking the money out of them. How you do that I can't say, if
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If the best comparison you've got is Nazi Germany you're setting the bar very low.
Partisan games (Score:5, Insightful)
So is that the game now? Pretend bad things are partisan and avoid any discussion of the badness?
I notice that Mitch McConnell didn't like being called Moscow Mitch. This is because defending America against an ongoing Russian attack is something Republican voters want too. It is not a partisan thing.
So he got a bunch of young men, and a cutout of Alexandria Ocasio-Cortez, and cutouts of Judge Brett Kavanaugh, and had them pretend to be supporting Brett by molesting the Cortez cutout. Posting the picture and doing a 'boy will be boys' tweet. Better to be called 'Democrat Molestor Mitch' than 'Moscow Mitch'. i.e. try to turn it partisan.
His previous attempt at this, posting pictures of gravestones with Democrat names on them, and a gravestone labelled 'socialist' did not work. This shortly after a mass shooting of women and children. Again, trying to make mass murder of wmen and children into a partisan issue, as if Republican voters aren't afraid their kids won't come back from school alive, too.
And here the Republican trolls are. Doing the same thing. Avoid the discussion of this deal, and pretend its partisan, and the Republicans are the victims by any discussion of the things they did.
All comments that encapsulate the 'STFU' nature of Republicans these days. You make choices, and you cannot face the consequences of those choices. Mitch won't attend any of the funerals he caused.
Oh booo hooo, look at this deal, its terrible. It has the state picking up the wage bill for low wage workers for a decade.
Growth at 2.5%, tax cuts for the rich adding $600 billion a year to debt, i.e. fake growth at 3%, so the underlying economy is shrinking. That needs to be tackled quickly. You cannot print money against a shrinking economy and not have a repeat of 2007. You need a grownup in the Whitehouse. Republicans *can* do better than this. You *should* be able to talk about your policies, because the consequences should be *good* not *bad*.
It's sad to see what the GOP has become.
Re:Partisan games (Score:5, Insightful)
Growth at 2.5%, tax cuts for the rich adding $600 billion a year to debt, i.e. fake growth at 3%, so the underlying economy is shrinking. That needs to be tackled quickly. You cannot print money against a shrinking economy and not have a repeat of 2007.
Somebody actually understands what's happening to the US economy right now.
The worst part is that it will be a Democrat who has to come in afterwards and be the bad guy, picking up pieces and tightening belts while everybody loses their paid-for jobs and goes on about how great things were under Donald Trump.
Rinse, repeat.
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Yeah, we get that you love sucking Democrat dick but tell us why the debt continued at runaway speeds when Obama was given a blank check for the first two years of his presidency.
For the same reason that the economy will continue tank for at least the first two years after Trump's gone.
Remind us again of when the housing crisis happened in the USA. Was that before or after 2009, when Obama took office?
https://en.wikipedia.org/wiki/... [wikipedia.org]
TLDR: It takes two years to start to turn an entire economy around when it's in disaster mode.
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It takes two years to start to turn an entire economy around when it's in disaster mode.
It takes two years only if you're very lucky and mostly manage to avoid mistakes. If not, it may take a decade and a world war.
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Honestly I am almost blood-minded enough to hope that for the sakes of recalcitrant morons that think like you write your trolling, that Trump and the Republicans do win in 2020 so that they can sit in the hot seat while the US crashes hard and hot and take all the "credit" for it.
I actually think the same. At this point I want Republicans to be in charge for at least two terms more. Let's see how far down this can go.
The only problem I see is that Trump can always come out of this looking good. Just like all his other bankruptcies, it won't be him that gets to clean up.
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So he got a bunch of young men, and a cutout of Alexandria Ocasio-Cortez, and cutouts of Judge Brett Kavanaugh, and had them pretend to be supporting Brett by molesting the Cortez cutout. Posting the picture and doing a 'boy will be boys' tweet. Better to be called 'Democrat Molestor Mitch' than 'Moscow Mitch'. i.e. try to turn it partisan.
Oh look. A lie and opinion propped up as news. One might say fake news and AOC is either too dumb to realize the truth or willfully uses misinformation and propaganda.
1) Those young men were not campaign staff. They were high schoolers.
2) Team Mitch condemned the actions.
3)"these young men are not campaign staff, they are high schoolers. "Team Mitch in no way condones any aggressive, suggestive, or demeaning act toward life sized cardboard cut outs of any gender in a manner similar to what we saw from Presi
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You are right: I am a Putin stooge and Republicans and bad and Democrats are good. Here is a hint for you: neither party gives a fuck about you. They are dividing the spoils equally.
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Well if you think you benefit from lies and tax cuts for the rich
You mean those tax cuts that resulted in record receipts for the federal government? Yeah, I think getting your Democrat friends off the neck of business did help. At least a lot more that the "Cash for Clunkers" and free money to Solyndra ever did.
Re:Please post groupthink below (Score:5, Insightful)
No, criticizing a political group isn't racism. Not even close.
1) Skin color is not your choice.
2) Skin color does not automatically make you a member of a club of people who support the same policies as you do, quite the
opposite, a group of people with the same skin color can be quite diverse politically.
3) Your party affiliation and the views you choose to subscribe to are entirely your responsibility.
4) Belonging to a party means you agree with and support more or less the same policies as everyone else in your party.
So, while it doesn't make sense to attack a diverse group based on a random physical trait that members have no control over, criticism of a group that has deliberately chosen to support certain actions and policies is defensible and has nothing to do with racism.
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It's almost as if.... people should be judged not on the color of their skin, but on the content of their character. Because you can't control your skin color but you sure can control what kind of person you are.
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Fallacy of linking an irrelevant "fallacy".
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I’m bad at groupthink
This deal is excellent (Score:1)
This deal is great, it creates jobs, it was the best deal possible and Republican Scott Walker and Republican President Trump did this great deal. They are the toughest negotiators, world class businessmen, and $290,000 of tax payer money paid to Foxconn, for each job is a small price to pay for the guaranteed 3-5 year running time of this plant that Foxconn promises.
Best businessmen ever!
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They didn't pay that much per job. You are considering it as if it were taken from the treasury. It wasn't. They just didn't tax Foxcon as much on Foxcon's investments as normal. Money that wasn't in the treasury in the first place and never would be if Foxcon didn't set up shop is not a mysterious empty bank account.
Your dad giving you an allowance is subsidizing you. Your dad cancelling that allowance isn't you subsidizing him. The money was never yours to begin with.
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Usually with these deals, the taxes would have paid for infrastructure and services to support the factory. The factory is still going to need infrastructure and services, just not pay for them.
It's like paying for a car and not having to pay for the gas and insurance with the idea that what you spend on snacks at the gas station will cover the free gas and what you spend at the oil change place will cover the insurance.
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Sure they did, just not all at once. The taxes would have been Foxconn paying for services and infrastructure it will be using over the time period. Roads will have to be expanded and maintained. The factory will need to be connected to the water works. It will need police and fire protection, etc. Instead of paying for all of that in taxes, it will come out of the treasury.
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But we're WINNING! We're winning so much that we're bored of the winning!
Maybe it sounds like I'm picking on Trump here, but to be fair I'm picking on voters from any persuasion. Anyone who believes campaign promises from ANY politician is either dumb, gullible, or blinded by a partisan view. Politicians say what they must to be elected, but they won't or can't follow through. Especially the president who really does not have enough power to implement most campaign promises in the first place (which is a
There's nothing to fix (Score:5, Insightful)
The "right" people got paid and/or were promoted. Everything went as planned. Where's the beef?
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The Wisconsin electorate has already spoken. In the election last year every single statewide office went to the Democrats. The Republicans only retained power in the legislature due to their extreme gerrymandering that they paid consultants to work out behind closed doors. The Republicans are working hard to hold onto that edge despite a majority of the voters not choosing them.
Perhaps Evers can cut off this contract the way that Scott Walker cut off the high speed rail project that had already been app
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Can someone please buy the Trump Steaks(tm) before they start going bad?
Re: There's nothing to fix (Score:2)
Somewhere in Wisconsin there is an underpaid civil servant driving a band new Tesla. Follow the money, follow the blat.
Suitcases full of cash in a dark parking lot. Dumb as rocks offspring admitted to elite schools.
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Two things:
1) A brand new Tesla Model 3 has about the same TCO in the first 5 years as a nicely loaded Toyota Camry. That's not out of the reach of most middle-class families, which is where civil servants tend to fall. A civil servant with a Tesla is definitely not a mark of corruption.
2) The Republicans, under Walker, got rid of or severely down-scaled several state agencies tasked with economic matters. Then they helped create the Wisconsin Economic Development Corporation, and passed that state money to
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It looks like the deal was structured a bit better than the one in WI and it's slightly more on track: https://www.reuters.com/articl... [reuters.com]
At the base there's something to be said to giving the cash to a US entity vs a foreign entity.
So lemme see.. (Score:2)
Re:So lemme see.. (Score:5, Funny)
How about, you are just looking at the wrong metric. It is not the ration of government subsidies and tax breaks per job created, it is the ratio of government subsidies and tax breaks per dollar of campaign contribution. Probably that ratio was really efficient, a whole lot of tax breaks and subsidies for way in excess of campaign contribution, Wisconsin the ultimate in campaign contribution tax break efficiency, getting you the biggest tax break for the least amount of campaign contributions, as preferred by the majority of corporations.
It is not about the jobs, that's just advertising, it is all about delivery cost efficient legislation, the most efficient legislation per dollar of campaign contributions. Don't anyone pretend it is any thing different from that, equal access open to foreign corporations as readily as local corporations.
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So you're saying that it's cheaper to buy legislators in Wisconsin than it is in high price states like California and New York?
Wisconsin was desperate and had no morals (Score:1)
Now Wisconsin felt they needed a big c
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Wisconsin went it alone on granting access to lake water, without even asking the other signatories of The Great Lakes Compact. That group of states bordering the great lakes that is supposed to agree on usage of that precious resource. They simply said "Take our highly sought after resource along with all these subsidies!" and ignored the outrage of the other states.
The previous administration ignored the protests of the residents of that area who were forcibly displaced. They ignored the reports pointing
Comment removed (Score:5, Insightful)
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bribe companies to re-locate to sub-optimal locations hoping it will jump start their economy
I don't think anyone involved in the deal expected it to jump start the state's economy. This was a political move from the beginning, with the main goal being for the politicians to be able to claim that they brought the manufacturing jobs back, and that things were going back to the way they were in the "good 'ol days."
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Exactly right. Next door in Minnesota they're pushing biotech and tech companies, and their economy is booming. Wisconsin wanted to stay red and play to their base and tried to keep pretending that manufacturing was still a thing.
It's not.
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Would state-created make-work jobs be better? (Score:5, Interesting)
I'm kind of curious -- could the per-job subsidy have been spent on doing actual government work -- cleaning, basic repairs, sort of WPA-style stuff? I mean you could have paid people ~35k per year for four years on the low end of the subsidy.
I'm sure the original deal was based on some pie-in-the-sky estimates of Foxconn becoming a long-term institution in the state, not only employing thousands for decades, but creating an ecosystem of suppliers, customers, etc, and direct state sponsored jobs wouldn't do this.
If they're gonna give away money, they might have well just done sub-market loans to existing small business and some kind of infrastructure enhancements vs. giving it away to a foreign multinational. That would probably have more long-term value for the economy than giving it to Foxconn.
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Say what you want about the inefficiency and bureaucracy of state jobs, at least they are non-profit. When you're paying companies for jobs, there's every incentive to suck up as much taxpayer money as possible.
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> No, because the 'subsidy' is a reduction in taxes, not a check paid to Foxconn.
Not directly, no. But they did get land practically gifted to them - after it was seized from people already living on it by eminent domain. And those infrastructure improvements will not pay for themselves with taxes at Foxconn's current commit. The only people making out well here are Foxconn who get a dirt cheap business park to use pretty much as they please to evade tariffs, and the companies who did the roads and ot
ah (Score:1, Troll)
If the subsidy levels in the current contract are kept, each Foxconn job would cost taxpayers about $290,000
Clearly we need to replace this with something more efficient, like another massive public assistance bureaucracy ...
Why isn't it a persuasive defence? (Score:2)
Does he think Foxconn will go bankrupt and won't be able to pay the clawbacks? Otherwise how the isn't it a defence to point out that the terms of the contract make it impossible for his calculations of the subsidy costs to be correct, because the subsidies will be clawed back.
I find his single line hand rejection of their defence without argument unpersuasive ... this all smacks of partisanship.
Until the Republicans Quit Giving Money Away... (Score:2)
If Foxconn would just leave that'd be fine (Score:5, Insightful)
As for Amazon they were again trying to get NYC to pay their operating costs for them while also making moves to bring out of towners to take the jobs instead of locals. NYC rightfully told them to get bent. They're not quite as corrupt as Wisconsin.
I've said it before, I'll say again: You don't get good paying jobs with subsidies. You get them by making a place where skilled, valuable workers want to live and work. My kid will graduate next year. She might go on to get her Masters, but when she's done she's not hanging around my crappy little red state & it's cities. She's eyeing Colorado, Seattle, parts of California and maybe even Canada.
Supply side economics doesn't work. We've known it for ages. Hell, Bush Sr called it Voodoo Economics. That goes for all levels of the economy. Work on the Demand side. Make businesses come to you by making your city someplace where valuable workers flock. That means clean streets, nice amenities, good schools and hospitals. An endless barrage of tax cuts for the rich is not how you do that.
Re:If Foxconn would just leave that'd be fine (Score:5, Insightful)
Tax cuts for the rich are almost exactly how you don't do it, because you need that tax money to build all those things in the first place
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The economy really is all about the velocity of money. The faster it changes hands, the better the economy. Every time it does, it gets taxed.
The rich tend to stockpile cash. The poor and middle-class tend to spend it.
The more the bottom 75% have, they more they spend, and the more the economy is fueled. This is exactly why stimulus programs like "cash for clunkers" and direct cash payments are so very effective. The issue is that we rack up debt to fund emergency programs like these when we're in recession
Re:If Foxconn would just leave that'd be fine (Score:4, Insightful)
How are you going to pay for all those clean streets and nice amenities without any workers to tax?
The notion that workers can live where they want and the jobs will follow is only a very, very recent one (less than a decade or so) and only applies to information workers where locations are moved easily. You won't move a manufacturing plant so pretty much anyone with a need for a lab, a workshop, a plant floor or any of the like can't pick where they want to live. Amazon won't just move their sorting facilities out of the way because a bunch of hipsters wants them to nor will airports move on the fly.
I agree that subsidies are a poor way of doing business, these weren't subsidies though, they were selective tax cuts and they are basically a runaround the established tax code. Tax cuts ARE a good way of generating new business, the less you tax business, the more attractive you make your environment, hence why the US is now in a place where we have record unemployment whereas previous administration's tax raises created a very anemic recovery from an economic downturn.
Look at the Arab Emirates and how they're trying to transform from an oil country to a business country. Same goes for Israel which has a boatload of R&D and startups that sell high-tech stuff all over the world and a load of places around the globe that have good business environments.
Government stability does have a huge impact as well, so if your government policies are changing under you continuously or can be changed on a whim by some dictator like most of South America or the old USSR, you won't attract business. This is a problem at the state and local levels within the US where government control isn't properly split up between parties and you have single party rule creating instability. China on the other hand has been able to control their own interventionism in business and they thrived.
Re:If Foxconn would just leave that'd be fine (Score:5, Interesting)
whereas previous administration's tax raises created a very anemic recovery from an economic downturn.
The blatant falsehood of this statement undermines everything else you said. The current administration has imposed huge taxes, and the current economic prosperity is a straight-line progression from what the previous administration did. Except for the massive contraction in manufacturing that has appeared in the last two quarters, due entirely to the current administrations taxation of imports, which has both raised prices for manufacturers who use imported resources (most of them), and provoked foreign retaliation which has cut them off from exports.
Oh, and contractions in manufacturing usually presage recessions.
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So how cone recovery didn't happen for 8 years if it was a linear progression? Look at the stats, it wasn't linear. Although I do agree that the tariffs aren't helping which if you factor that in, the current administration's economic policy would look even better.
On the other hand tariffs make sure that your manufacturing although more expensive stays in the country, China has done this for decades hence why Vietnam or Korea isn't a regional powerhouse in manufacturing.
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To some extent Vietnam and definitely South Korea are regional powerhouses in manufacturing, especially for their size compared to China.
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So much wrong in all of this, it's difficult to know where to start: ... stays in the country". That might happen if you're lucky. But often, they kill off a company or sector ent
1. Recovery took a long time because -- and sorry if you missed this tiny point -- there was a global economic downturn on the scale of the Great Depression, and funnily enough, it takes quite a while to recover from those things, even when you do the absolute best possible job of recovery.
2. Tariffs do not "make sure manufacturing
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> So how cone recovery didn't happen for 8 years if it was a linear progression? Look at the stats, it wasn't linear.
The recovery did happen and it was exponential. GDP growth for 2008 was -0.1%. GDP shrinking peaks in 2009 at -2.5%. From 2010 - 2016 on the GDP growth was between 1.6 to 2.9% following some fluctuations with a mean growth of 2.2% each year. Since 2016 it has been 2.4% and 2.9%, within the same range. Or look at unemployment. In 2008 it was 7.9%, peaks in 2009 at 9.9% and decreases year ov
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The current economic prosperity is notional. We are in another bubble condition, and this time it's tech and real estate at the same time. Underemployment is rampant, and deliberately not tracked adequately by the unemployment rate.
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I try to tell this to people who think we should pay for roads with sales taxes rather than user fees but they just won't listen.
In the past the Federal Government gave grants (Score:2)
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On the other hand, a business looking to expand won't want to build in the middle of a smoldering shithole where they'll have to pay qualified workers double to induce them to move there.
They also don't want to build somewhere on the edge of a full scale riot that could see their new facility set on fire or blockaded by rioters.
How do we pay for the subsidies? (Score:2)
Also I'm really, really, really sick and tired of being asked "How are we going to pay for it". First, nobody asks how are we going to pay for the 8+ wars we're running _right_now_. But ok, that's whataboutism.
Moreover, everything costs money, and that includes doing nothing. If you let your roads, school system
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Do you mean subsidize as in give money to, which is money out of your pocket? Or do you mean subsidize as in the nasty class warfare rhetoric that likens it to letting them keep some of the taxes they would otherwise have paid? In other words, not money out of your pocket.
This is the danger when falling into that rhetoric -- you think that letting them keep some of their own money is subsidizing them. I prefer to think of it as getting off their back so they can move better. Paid back? Most of that "los
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Yeah, because it costs $0 to build roads and sewers and expand police and fire departments and create all the infrastructure and services that state and local governments are responsible for.
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I don't think one size fits all and there are systemic problems of not enough money/capital in the economy and not enough market demand to create good paying free market jobs for everyone. So you get concentrations of wealth and success in select areas. Some successful areas are based on free market capitalism and some based on government subsidies and tax breaks.
Here in Massachusetts, Universities get huge tax breaks (and government subsidies) and they underpin a big part of the local and regional econom
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Both parties (the state and the company) came to an agreement. The state changed leadership on the campaign promise of rescinding their part of the deal, in response Foxconn picked up and left the state leaving the state to hold the bag.
Is that really true? The state leaders changed the agreement in a way that made Foxconn leave?
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No, it isn't true. Foxconn was already screwing up the deal before the election was even finished much less the new administration taking over. In fact, the former Gov. Walker probably lost because that deal looked so bad. The GP is lying.
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It was a bad deal for Wisconsin even if all the hype was true, and Foxconn was never go to live up to all the hype in the first place. Then Foxconn scaled back it's plans before the election, not because of the election.
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Lie delay obfuscate and walk off
Sue, seize and ban.
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They cost the state money in adminstration, which is a pittance compared to the total amounts, but not literally nothing. Your privilege of using that word is hereby revoked until you learn to speak English.
It also costs the state money to have people do business in it, so if they aren't paying their fair share, that costs money as well.
You are wrong in every way in which it is possible for you to be wrong.
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Your criticisms are LITERALLY asinine.
I said "tax credits and hiring credits literally cost the state nothing"
Yes, it costs electricity in the lightbulbs for the rooms in which to read the documents. Probably some paperclips too. Seriously? That's the best you've got?
Because if a state "gives" FoxConn $1 billion in future tax credits and Foxconn never builds a factory where there said, again, I say this very precisely: it LITERALLY costs the state nothing BECAUSE FOXCONN NEVER APPLIES FOR THE CREDITS BEC
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I said "tax credits and hiring credits literally cost the state nothing"
And you were wrong. Just like I said. Just like always. Go away.
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You repeating something over and over doesn't make it true. Your mom was wrong.
Re:"Cost" (Score:4, Insightful)
A couple more ways the OP was wrong:
1. Often these kinds of deals involve the state paying for or building infrastructure: roads, rail, electricity, water etc. Not sure if that was the case here
2. Giving one company a subsidy really annoys incumbent companies in a state, who then threaten to leave unless they get their kickback, creating a significant downward pressure on tax income
It's really extraordinary to see people who think of themselves on the right defend the state putting its thumb on the scale -- especially when it's done so ineptly.
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1) it didn't. It was tax breaks and credits for reaching employment goals. In neither case does Foxcon gain a single penny (or, more accurately Foxconn would pay the state less; in no case did Foxconn get dime from the state) unless they create the factory they promised - which they clearly won't. Some analysts assert that WI bent highway funding to Foxconn's advantage - this is suspect. This is on the ORD/MKE corridor, a part of WI that has been *heavily* funneled development money for industrial and c