KIA opening up plant in Georgia & saving a town

[The_Casual_Observer]

http://www.cnn.com/2009/LIVING/worklife/07/08/fortunate.town/index.html


The solution to the economic problems in this country isn't temporary measures & bailouts, it's a renewal of basic manufacturing businesses.

[Egalitariat]

1. $400 million in tax breaks? Is that corporate welfare?

That's a big number. I know that Alabama created an amazing auto industry with about $200 million in "corporate welfare" that ended up being a tremendously good investment.

I hope the same works out for West Point.

[The_Casual_Observer]

3. The tax breaks are virtual income that the state never had anyway

The real money will be in the hands of the workers in that town come Friday.

[Billy Burnett]

4. A great investment of US corporate welfare for foreign corps that kill US corps.

Meanwhile the same repukes don't think it's a good investment to invest in US companies making cars in the US and employing US union labor.

[The_Casual_Observer]

6. I didn't see any US Corps stepping up to build any factories there.

They'd be offered the same benefits I'd imagine. Meanwhile 20,000 jobs are going to be created while US companies continue ot "shed" jobs by the 100's of thousands every month.

[DainBramaged]

8. ANOTHER DIRTY LITTLE SECRET. 2500 JOBS COST $400 MILLION

[The_Casual_Observer]

13. It cost them nothing. They never spent 400 million. There never was

400 million and there never was going to be 400 million, all there was going to be was another textile ghost town.

[DainBramaged]

16. Tax breaks are lost revenues

I am tired of these right to work states giving away the farm to secure foreign interests while our own American owned manufacturing is criticized and Unions are excluded from this workforce.

Bullshit, Union first. Ask Korea when they are going to lower the trade barriers to AMERICAN MANUFACTURED PRODUCTS AND PRODUCE and we'll talk. Do you have any idea what the trade deficit is between us and Korea? Of course not, getting those minimum wage non-Union jobs in the South is all that is important.

[scheming daemons]

17. Not if the factory wouldn't have been there WITHOUT the tax breaks

Prior to the factory: $0 revenue from KIA


If KIA is only building because it is getting tax breaks, then it is NOT lost revenue.

[Statistical]

18. False comparison

No KIA plant = $0 in taxes from KIA

KIA plant = $0 in taxes form KIA (for first $400 million) then taxes from KIA.

Worst case scenario is KIA never pays taxes. If there was no KIA plant KIA wouldn't pay taxes. Best case scenario KIA builds lots of cars, expands the plant and eventually the tax breaks run out.

It is a win-win for the state.

[The_Casual_Observer]

20. Sure, they would get the 400 million from the other US owned factory

with union jobs willing to pay the 400 million that was all set to move there first.

[misanthrope]

23. What about the burden on the infrastructure?...

...It's never as simple as the corporations and these states phrase it.

And the guy around the corner from me, a fellow with a small hardware store who employs a few locals and is a textbook example of American entrepreneurship, his money's good enough for the government to collect, but a monolithic entity whose profits eventually end up overseas pays nothing? Sounds a lot like the Third World to me.

[DainBramaged]

28. You are wasting your keystrokes, this is DU, and if it's Foreign, it's gold.

[The_Casual_Observer]

30. Nobody complained about any burden when the textile factories were in business

[misanthrope]

36. Were the textile industries paying their taxes?...

...The South has lured industry for over a century by bragging about the near-Third World conditions, lax environmental standards and easily exploitable (basically disposable) labor. For generations, they merely turned northward, opened their arms and chanted, "Cheap land, cheap labor, cheap taxes." Now it's become known as an industrial tier between what used to be the American standard and the standard for places with despots and banana republics.

Of course, it's become clearer that the USA has more than its share of despotism, banana republic occurrences and encroaching fascism.

But leaving all reason aside and going merely on intuition, if a political/socio-economic practice or trend has earned raves among the elected leaders of the Deep South, it is bad for America. If Haley Barbour and Bob Riley are for it, fight like hell.

[Statistical]

35. Burden?

If read the story the town has been on a long slow death. US companies could have jumped in any time to save the town but they didn't.

Store owners talking about business being massively up. First new construction in 25 years.

Remember a major plant isn't the only job there. A bunch of part suppliers are moving in also. Those people need places to eat, and buy furniture, go to the movies etc. So the next effect to the economy is a multiplier. The town will be getting more revenue from income taxes due to higher income and more people employed. Businesses will collect sales taxes. Other businesses are paying corporate taxes.

I guess it would be better for the town to just die and become a ghost town.

Lastly profits go to shareholders. Want to keep KIA profits in the US buy KIA stock (not that I recommend it).

[no limit]

19. Its actually 20,000 jobs if you read the article

That comes out to $20K a job, very good deal considering they would have never seen that 20K per job if the plant didn't open. All those workes will still be paying income and sales taxes. Not to mention all the other indirect jobs that this will create.

Why anyone would be opposed to this is beyond me. This is a great thing. I dont give a shit if a company making cars here is American, Japanese, or Korean. The jobs are being created here. Meanwhile Ford, GM, and other american companies are shipping their manufacturing to Mexico.

[misanthrope]

24. Isn't that reasoning used in Asian sweatshops?**nm

**

[no limit]

27. Put the bong down dude

What are you talking about?

[rucky]

26. in a "Right to Work" state.

this isn't a rescue - it's a race to the bottom.

[The_Casual_Observer]

31. Tell that to the people who would otherwise be permanently unemployed

[rucky]

34. yep. we'll take what we can get.

I wouldn't mind so much if the cost of living went down with wages.

[Sebastian Doyle]

2. Kind of a mixed blessing there.

Pro: there will be jobs

Con: they aren't union jobs, and most of the money goes back to Korea, not into the local economy.

[Egalitariat]

5. I don't see how "most" of the money goes back to Korea

I'm assuming you're talking about the profits, and the profits from one car aren't even close to the cost of making that car.

[The_Casual_Observer]

7. Actually, who would care where that money went anyway. I'm sure

the 20,000 people with NEW jobs aren't going to care.

[Xithras]

12. Only about 5% of a cars cost is pure profit. Most of the remaining 95% go into production.

That 95% is spent on everything from purchasing raw materials, to parts from subcontractors, to employee compensation. Yes, the profits go to Korea, but the rest is injected into the local economy via the workers paychecks.

[prostomulgus]

9. Hopefully, card check will get here soon.

Then this plant, along with those of Toyota, Nissan, BMW, etc., can be quickly unionize like their Ford/GM/Chrysler counterparts.

[OneTenthofOnePercent]

32. If I were an automaker... I wouldn't do ANYTHING to

emulate Ford/GM/Chrysler...
I would infact, structure my business to as large of a contrast as I could.

[Hansel]

10. Actually it's both.

We need temporary measures and bailouts to stabilize the economy until businesses can get up and running.

We also need tax increases on those who have benefited from society and can afford them to start paying down the deficit. You either pay a little now or a lot later, but the deficit has to be paid down. We would have had to pay a hell of a lot less if Bush had not put tax cuts in place in the first place while spending like a drunken sailor.

The economy is complex and so is the solution to fix it. We need to throw everything we can at it.

[elifino]

11. All new jobs in the USA are welcome

I left West Point,Ga. in 1956 after graduation from high school to join the Navy, it was apparent even then the future was not good as far as job opportunities. I have many fond memories of West Point. I attended our 50th class reunion in 2006, only a few of my classmates still live there. Most of the people I talked to are very excited about the future.

[The_Casual_Observer]

14. "Most of the people I talked to are very excited about the future"

!!!!!

[elifino]

15. they were excited then in 2006

[DainBramaged]

21. DU, where it's members cheer for the Foreign interests who block our products from their countries

Stupid and anti-Union. Period. Fuck this.

[The_Casual_Observer]

22. What products?

Hope you aren't holding your breath for the Labor Unions to create new jobs someplace.

The only thing this country exports is jobs.

[DainBramaged]

25. You really are clueless to the situation, aren't you?

Korean automakers sold nearly 800,000 cars and light trucks in the US market in 2005, while the American Big Three sold less than 4,000 in the Korean market. Chrysler, Ford and General Motors claim their lack of success is due to Korean taxes on engine size, constantly changing Korean regulations and the lingering effect of past government efforts to dissuade consumers from buying imported cars.

http://yaleglobal.yale.edu/display.article?id=8600

If you knew (or wanted ) how to use Google, you'd find the truth. The free trade agreement hasn't improved

conditions one iota.


http://www.washingtonpost.com/wp-dyn/content/article/2007/04/02/AR2007040201617_2.html

Labor leaders took a similarly combative stance. "We have no confidence in the Bush administration to negotiate a good deal for American auto workers," said Thea Lee, legislative policy director at the AFL-CIO, whose affiliates include the United Auto Workers union. "This is shaping up to be an enormous political problem for the Bush administration."


http://www.buyusa.gov/korea/en/traderegulations.html

Korea bound 92 percent of its tariff-line items as a result of the Uruguay Round negotiations with its average basic tariff at about 7.9 percent. Duties1 still remain very high on a large number of high-value agricultural and fisheries products. For example, Korea imposes tariff rates of 30-100 percent on many agricultural and horticultural products of interest to U.S. suppliers. Under WTO "Zero for Zero" initiatives, Korea is in the process of reducing tariffs to zero on most or all products in the following sectors: paper products, toys, steel, furniture, semiconductors, and farm equipment.

Korea also maintains a tariff quota system designed to stabilize domestic commodity markets. Customs duties can be adjusted every six months within the limit of the basic rate plus or minus 40 percent. On December 16, 2004, the Ministry of Finance and Economy (MOFE) released the 2005 list of products subject to adjustment tariffs and quota rates. A total of 46 agricultural and fishery products are subject to adjustment tariffs (18 products) and quota tariffs (28 products).

[The_Casual_Observer]

29. This means nothing to the people in that little town. If there was

no market in the US for american cars, you figure that they stood a better chance selling them in Korea, that it's Korea's fault?

[Obamanaut]

33. There will be jobs. These jobs will be filled by people who will

spend money locally. But that won't mean a thing to the folks who proclaim to the heavens that if it doesn't have GM, Ford, or Chrysler on the trunk lid we'd be better off without the jobs. My guess is those people have a job.

Seems rather shortsighted. If these big three had been all that concerned about remaining the big three they would have modified their business practices so they would not have become the nearly forgotten three.