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Saturday, December 1, 2012

Sweetheart deals for "jobs" don't work

But local governments across America keep on making them. That would be a bad thing, even without the graft.

Comments (15)

The NY Times article has a great quote:

One corporate executive, Donald J. Hall Jr. of Hallmark, thinks business subsidies are hurting his hometown, Kansas City, Mo., by diverting money from public education. “It’s really not creating new jobs,” Mr. Hall said. “It’s motivated by politicians who want to claim they have brought new jobs into their state.”

Economic development agencies are right up there with UR on the sham scale.

I hope to live long enough to see housing come back, but nobody should bet on manufacturing jobs being important soon. The auto industry was pretty much a one off, and studies show job retraining isn't too successful -- people who pound and bang stuff together, it turns out, don't take too well to web designing.
Wonder what kind of American basket weaving and folk art passing Asian tourists might buy?

In Portland, our redevelopment agency, having failed epically to do anything but build apartment towers, is now claiming to morph into an economic development agency, in which it's striking out even worse.

It may appear that the NYT has figured this out, but I'm convinces that would be a delusion.

Jack you have it right about PDC now focusing on economic development. Director Patrick Quinton has now been on that bandwagon for about six months with all kinds of new focus documents and committees. This new focus will continue stealing dollars from education like Hall said in the NYTimes article, plus from police, fire and parks. Nothing is changing.

Why didn't Times print this article before the election since Obama claimed all the GM, and other stimulus dollars, were great for our economy? Romney failed to paint the true picture.

This may be a problem elsewhere, but Portland politicians only throw money away on sustainable make-believe jobs, so we don't have that to worry about. As any local resident will tell you, we only elect enlightened officials.

If jobs have to be eventually paid for plus interest by those needing the jobs in the first place, then the newly created jobs are only wet bandaids. We are simply paying for or borrowing to pay for jobs now, and those jobs can never be sustained. C Christie figured this out when he stopped the commuter rail project. Portland it seems, is going the other direction.

Just look at TriMet. It's focused on creating jobs and development...I always thought it was a transit agency. But development and building light rail lines is its largest priority...actually providing a useful service for the public isn't even in their mission statement anymore.

Sweetheart deals for "jobs" don't work

Yep! Same logic should apply to any sports franchise. The players simply play the jurisdictions against one another. Same old story.

"economic development agency"

$35M to GlickmanJr and Mr Mary Nolan for PGE Park
$10M to Gerding-Edlen for tenant improvments for their building
$5M to ReVolt for go knows what
$1M to just get IberDrola to NOT move
Several commas worth of money for the Convention Center
$165M or so for a CRC bridge design that won't work.

That's just the local BS. This is like letting the idiot son have daddy's wallet to play with.

As long as you can move your profits and tax obligations overseas, there will be no economic recovery.

The only solution is to change the tax structure to where companies that produce jobs in the USA get a much lower tax rate and anyone importing goods to the USA pays a tarrif.

A simple solution that has never failed, but convincing the congress critters to actually care about their constituents is just not going to happen.

The only solution is to change the tax structure to where companies that produce jobs in the USA get a much lower tax rate and anyone importing goods to the USA pays a tarrif.

That sounds great, but what happens when we have organizations like the WTO get on our back because we "subsidize" Boeing (a domestic aircraft manufacturer) while heavily tax Airbus (an European aircraft manufacturer) Then the WTO and EU would instill punitive tariffs on Boeing aircraft in response...

Maybe a tax system needs to be set up where U.S. payrolls are considered a credit against taxes...but management salaries are not included.

From my neck of the woods:


In this little game, what's always the most interesting is looking at the longterm trends. in 2001, Boeing played Denver, Chicago, and Dallas against each other for hosting Boeing's new headquarters, even though the company admitted that the headquarters move was purely for the tax writeoffs it could no longer get from Washington State. Even as we were told that the new HQ would only bring in about 700 positions at most, our then-mayor bent over and screamed "Come and get it like a big funky sex machine!", the way he traditionally did for Texas Instruments.

And that was the funny part: at the same time half of North Texas was plotting and scheming to get the Boeing headquarters, Texas Instruments (and Raytheon, which had purchased TI's Defense and Strategic Electronics Group ten years before) was shutting down plants left and right, just as their 20-year tax abatements were ending. The moment TI had to pay taxes on anything, it moved everything it could, and I expected the same exact thing from Boeing. That's why I have to admit that I was glad that Chicago got the bid: at least its politicians were willing to take Boeing for what they could, instead of following the Dallas method of "kiss the executives' boo-boos and make them ALLLLL better".

And for those who noted that the same thing goes on with sports franchises, again, look at Dallas as an example. The moment Hunt Oil CEO Ray Hunt had to pay a penny in taxes on Reunion Arena, the former home for both the Dallas Mavericks and the Dallas Stars, he conned the city into paying for a brand new arena with another 20-year abatement. He then made sure that Reunion had no choice but to be torn down, so that there was no chance of it competing with his new arena. Jerry Jones did that as well with the new Cowboys Stadium, leaving the cost of demolishing the old Texas Stadium to the city of Irving. (Again, Jones made absolutely sure that the city had no choice but to demolish it, for fear it might be taken over by another team.) I'd like to think that these scumballs will finally get their comeuppance on these sorts of stunts, but I've waited a third of a century, and I haven't seen it happen yet.

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