Sun Dec 2, 2012, 12:33 AM
Newsjock (11,733 posts)
NYT: As Companies Seek Tax Deals, Governments Pay High Price (5,075 words)
... A Times investigation has examined and tallied thousands of local incentives granted nationwide and has found that states, counties and cities are giving up more than $80 billion each year to companies. The beneficiaries come from virtually every corner of the corporate world, encompassing oil and coal conglomerates, technology and entertainment companies, banks and big-box retail chains.
The cost of the awards is certainly far higher. A full accounting, The Times discovered, is not possible because the incentives are granted by thousands of government agencies and officials, and many do not know the value of all their awards. Nor do they know if the money was worth it because they rarely track how many jobs are created. Even where officials do track incentives, they acknowledge that it is impossible to know whether the jobs would have been created without the aid.
... A portrait arises of mayors and governors who are desperate to create jobs, outmatched by multinational corporations and short on tools to fact-check what companies tell them. Many of the officials said they feared that companies would move jobs overseas if they did not get subsidies in the United States.
... For local governments, incentives have become the cost of doing business with almost every business. The Times found that the awards go to companies big and small, those gushing in profits and those sinking in losses, American companies and foreign companies, and every industry imaginable.
Workers are a vital ingredient in any business, yet companies and government officials increasingly view the creation of jobs as an expense that should be subsidized by taxpayers, private consultants and local officials said.
Part 1 of a three-part NYT series:
UNITED STATES OF SUBSIDIES
A series examining business incentives and their impact on jobs and local economies.
PART 1: How Taxpayers Bankroll Business
COMING MONDAY: Winners and Losers in Texas
COMING TUESDAY: When Hollywood Comes to Town
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Response to Newsjock (Original post)
Sun Dec 2, 2012, 09:56 AM
Igel (24,018 posts)
1. At least this NYT writer sees the problems.
Give subsidies, and it's hard to know if the jobs promised were produced.
If the jobs were produced, it's hard to know if they'd have been created anyway.
They only ask these questions, though, when they're skeptical. Easy to think critically when you're already critical. It's the kind of question that's more important to ask about things you support or think are good ideas. Critical thinking should fight, not feed, confirmation bias.
The third question is whether the money used for subsidies would have produced more benefit spent elsewhere. Opportunity costs matter.