Nothing went wrong. They dodged a bullet. Tax breaks to "create" jobs, public financing of professional sports stadiums, hosting the olympics. None of these are good investments of public funds. They aren't even mediocre investments. They're bad for everyone but corporate beneficiaries and the politician who gets to pretend he or she did something useful for five minutes.
I actually just came across this one this morning and happen to have it open in a tab. I'm only about halfway through but it's really interesting. They mention that some states have constitutional clauses that would seem to prohibit these sorts of arrangements altogether. I'm planning to check Westlaw to see if anyone has ever brought suit alleging the breaks to be unconstitutional but I haven't had a chance yet.
The astronomical tax breaks and other perks that these companies get when relocating or building new seem a little strange when I think about it. Municipalities are going to have to deal with fallout from 50,000 new people, for example. Road use will go up, traffic patterns will change, maybe require more first responders, sewer, utility usage will go up, there may be environmental concerns.
What justifies giving out the perks (and probably bribes, if we're being totally honest) in light of the real costs to municipalities that get a relocated or new multinational? Is it all just increased tax revenue on the new jobs brought in? Because we should say that's the economic benefit. It's not at all clear right now. As a resident of Denver, one of the semifinalists, I think, I was watching this pretty closely locally, and we just got phrases like "economic benefits". Nothing specific.
I just read this interesting (and frankly, absurd) article about the creative "concessions" offered by various cities. Unfortunately this seems to go well beyond tax breaks. Though the tax breaks are pretty ridiculous it's just the tip of the iceberg. I would guess most taxpayers would oppose spending precious funds on: free zoo tickets, a private Amazon airport lounge, and free pet microchipping for new employees, among other ridiculous perks.
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[ 3.2 ms ] story [ 30.0 ms ] threadhttps://www.mercatus.org/system/files/farren_and_philpot_-_p...
I'd bet that the same thing would happen if Microsoft, Apple, Google, or any other number of big tech firms decided to 'branch out.'
What justifies giving out the perks (and probably bribes, if we're being totally honest) in light of the real costs to municipalities that get a relocated or new multinational? Is it all just increased tax revenue on the new jobs brought in? Because we should say that's the economic benefit. It's not at all clear right now. As a resident of Denver, one of the semifinalists, I think, I was watching this pretty closely locally, and we just got phrases like "economic benefits". Nothing specific.
https://www.theguardian.com/technology/2018/nov/14/amazon-ne...