While heading my teachers’ union in the 1970s, I was appointed to the Mayor’s Economic Advisory Council. I had no background in economic development but I satisfied a necessary profile to round out the committee. I was a woman and I was a union leader.
I soon learned my role was to be a rubber stamp for the mayor’s plans. But when I discovered a German company was to open shop in our community, after receiving massive tax incentives, I voted against the subsidies and left the council.
Later, as a County Commissioner, I railed against another industrial giveaway but lost the argument by a vote of 4-1. In both cases, these companies fed from the public trough, produced minimal paying work and when the party was over, they closed their operations and returned to their places of foreign origin.
Donald Trump’s negotiations with Carrier in Indiana preserved 800 of the 2,000 jobs. In exchange, the company received tax subsidies that border on the obscene, all to be funded by the taxpayer. In my lexicon, that’s called a pyrrhic victory.
That corporate welfare continues on a grand scale, boggles the mind. A recent article in Slate.com reveals Amazon received $760 million in taxpayer assistance between 2005-2014. That sum represents “17 percent of the company’s global profits during that interval.” (“Amazon’s help from taxpayers,” by Henry Grabar, Slate.com, excerpted in The Week, December 16, 2016, pg. 38.)
I find it difficult to believe Amazon needs tax subsidies. But local business, the ones rooted to their locale, do. Small businesses are the true wealth and job creators in a community. (Click) When local governments dip into local taxes to assist multinationals, small business get less assistance. That tax money should be reserved to encourage, enhance and grow small enterprises. Their profits don’t get deposited in foreign banks. A fair share supports government services. Corporate welfare for large and multinational companies is a bad idea from any angle.