Corporate Welfare Roulette

by: Jim Hightower, t r u t h o u t | Op-Ed

One thing that governors and mayors absolutely love to do is win a prize in the national game called "Corporate Welfare Roulette." It's a simple casino-style game in which politicos put down a big stack of taxpayers' money on an out-of-state corporation as an "incentive," hoping that their bet outbids other states and cities trying to lure that same corporation to move to their area and hire some people.

There's always a celebration when politicos "win" one of these cash-for-jobs gambles. The media gather, politicos prance, the Chamber of Commerce chief grins from ear to ear and the corporate CEO mouths platitudes about free enterprise (while stuffing taxpayer cash in his pockets).

Only six years ago, Winston-Salem, N.C., had its lucky day, having won the spin of the roulette wheel to land a corporate gem. Dell, the computer giant, was headed to town, pledging to erect a state-of-the-art assembly plant and hire up to 1,500 folks.

"We won," crowed all the local poobahs. They had put down about $318 million in tax giveaways, cash and other freebies to land the prize, and in October 2005, they enjoyed the glorious grand opening of Dell's $7 million plant. The future was bright.

However, one thing that governors and mayors absolutely hate to do is to face up to the fact that their prize has reneged, failing to deliver the promised number of jobs. Real bad politics.

Last October, four years and two days after Dell's gala opening in Winston-Salem, the giant suddenly upped and left! It abruptly announced that it would soon cut out for the cheap-labor havens of Asia, shut down the still-sparkling assembly plant, discard the 900 people it had hired (600 short of its promise) and kiss off North Carolina. Thanks for the memories. Adios, chumps.

Formerly gleeful politicos were now howling, demanding "every red cent of incentive money" back. But they had put down their money and taken their chances, and corporate gods are notoriously fickle. While much of North Carolina's subsidy had not yet been doled out, taxpayers still took a hit of about $17 million for its fling with Dell.

Meanwhile, the roulette wheel continues to spin, and more and more taxpayers across the country are learning that they're getting stiffed, receiving only a fraction of the jobs they were taxed to bring to their area.

This is always embarrassing to the public officials who've so enthusiastically played the game, but leave it to a Texas politico to come up with a slick political fix. When Gov. Rick Perry's corporate job subsidies don't succeed, he simply -- abracadabra! -- redefines success.

Texas has a long history of governors who have a genetic resistance to ethics, but this guy can't even spell the word.

A watchdog group, Texans for Public Justice, recently exposed Perry's flimflam in a report documenting extensive job shortfalls in his corporate deals. TPJ revealed that Gov. Slick had quietly been "amending" the terms of the contractual agreements that corporations signed to get our tax dollars.

Without even informing the other state officials who supposedly oversee the corporate subsidy fund, Perry eased the job-creation requirements to make the deals look like they are succeeding. Such slackers as Lockheed Martin and Tyson Foods have had their job quotas slashed, been permitted to count part-time jobs as full-time and even been allowed to use foreign workers (and possibly illegal immigrants) rather than Texas citizens to meet their job-creation obligations.

When he learned last month that the TPJ was about to bust his little secret "fix," Perry rushed out a statement lamely insisting that nothing was amiss, that his redefinitions were merely meant to "refresh" the state's job contracts.

Refresh? Why do I feel an urgent need to shower when I hear such a clean word ooze out of the mouth of such an oily politician?

The whole game of Corporate Welfare Roulette is oily. For more information on the scams that come from it -- and on what can be done to stop these giveaways -- contact Good Jobs First: www.goodjobsfirst.org.

Jim Hightower: National radio commentator, writer, public speaker, and author of the book, Swim Against The Current: Even A Dead Fish Can Go With The Flow, Jim Hightower has spent three decades battling the Powers That Be on behalf of the Powers That Ought To Be - consumers, working families, environmentalists, small businesses, and just-plain-folks.

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It has long amazed me that

It has long amazed me that people don't see how they are being cheated. Ever penny given to a corporation, every penny in tax not collected, has to be paid be everyone else. Big business skates and we pay the bill.

I've yet to see those kinds of breaks offered to locally owned small businesses.

To me, this is one more indication that our gov'ts are more interested in serving the interests of major corporations than they are in serving the people they are supposed to represent. But that's just me...

Lane Baldwin (.com)



Look back a few years to the

Look back a few years to the great Oregonian Jack Roberts who brought the fine little hamlet of Eugene, Oregon the blessings of Hyundai. Hyundai our great, massively subsidized corporate chip plant savior...
Oh where has our savior gone? And, daddy, what is that giant plant doing right in the middle of our wetlands?

'Don't get fooled again..."



That was my first thought,

That was my first thought, too. Why don't they invest public funds in local business? But even if they did, there is something fundamentally wrong in taxpayers needing to directly pay a business in order to "create" jobs. Below it all is a glaring fact that our society still fails to grasp: with land as private property, land speculation eliminates labor's access to this prime factor of production. Monopolized overpriced land... no production... no work... no jobs, and by the way, high prices and lots of debt. So then we buy into the idea that you have to purchase jobs from the business sector, like a pair of shoes. When the State gives incentives to businesses, a lot of those public funds end up purchasing real estate. SOMEBODY made a profit with that N.Carolina "stimulus" money. Real estate, Finance, Insurance and construction people. Instead of buying back land, the solution is to transfer all taxation off of labor, productive capital investment, and commerce, and onto LAND VALUES. Land prices would plummet and site access would no longer be a major cost of production. Business and labor would flourish. Real wages (acquisition power) and compensation for productive capital would rise dramatically.