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Tag Archives: tax-incentives

2013’s worst of the worst in Missouri

01 Wednesday Jan 2014

Posted by Michael Bersin in Uncategorized

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Ann Wagner, Boeing, Brian Nieves, GOP, Government shutdown, Jay Nixon, Medicaid expansion, missouri, Obamacare, republicans, Rex Sinquefield, tax-incentives, The Greater St. Louis Labor Council, unemployment benefits, Unions, Vicky Hartzler

I admit it. I like making my own end-of-the-year lists, and I like to see how my opinions line up with other list-makers. It’s silly maybe, but it can help to refine one’s perspective. So here’s my first end-of-the-year list which names the political actors and/or acts that struck me as the most absurd and/or inexcusable during 2013, hence the titular worst of the worst. (In order to balance the negativity, though, I’ll be following it with a list of the best of the best.) It goes without saying that my selections are entirely subjective and reflect my opinion only – nobody else is implicated by my judgement, although I invite anyone so inclined to take issue with my selections or offer their contrary assessments in the comments. And with that, away we go:

1. Rex Sinquefield: Sinquefield is a retired billionaire financier whose hobby is buying up Missouri state government in order to provide a staging ground for his libertarian theology. He plays a long game, lavishing tons of dollars on politicians of every stripe as long as they show even some teeny-tiny signs of sympathy for a small sliver of his goals.  What does he want long-term? Just a Missouri with all the attractions of the brutish Randian paradise for wealthy Übermenschen that excites today’s conservatives.

But hey, perverting the political process for the benefit of the rich and powerful is nothing new and, on its own, wouldn’t merit more than an honorable mention among the worst of Missouri’s recent worst. Mr. Sinquefield has been taking full advantage of the Supreme Court’s destructive endorsement of the idea that money equals speech for a long time. This year, however, plantation master Sinquefield found it necessary to crack the whip; he quickly helped launch a lawsuit to stop a campaign finance reform bill that would have reduced the decibels of his green-backed free speech to a level more in line with that enjoyed by less wealthy citizens of the state. And what does he do with this free-speech? He lies – as in his recent Forbes Magazine op-ed, an overtly counterfactual apotheosis of Kansas Governor Brownback’s tax free policies.

2. The Missouri anti-Obamacare obstructionists: And by obstructionists I mean the Republicans who control the state legislature. Thanks to these jerks, 193,000 Missourians will be out in the healthcare cold. These are the people who don’t make enough money to qualify for subsidies on the Obamacare exchanges since those in their income range were were meant to to get coverage through an extension of Medicaid eligibility, an extension that the state’s GOP, taking advantage of another gift from our conservative Supreme Court, have refused to enact. The same folks have refused to set up Obamacare exchanges, tried to hinder use of the federal exchange and pushed one dishonest story after another about the imagined perils of the law. Talk all you want about the initial failures of the Obamacrare Website or Obama’s rather tame “lie of the year,” the folks who’ve done the real damage are quite simply the politicos who are busy patting themselves on the back because they have saved Missouri’s poor from the moral hazard represented by actual health care.

3. Members of the Missouri GOP congressional delegation: These folks, many of them multi-millionaires, came home to enjoy their cushy Christmas celebrations after refusing to extend benefits for unemployed American workers. As a result, last Saturday 21,329 jobless Missourians lost the meager stipend (averaging $242) that often meant keeping food on the table. If nothing is done, 35,400 more workers will lose this cushion in the first months of 2014. The people’s Republican representatives felt free to cut benefits off even though currently there are, according to some sources, three applicants for most jobs and over 4 million long-term unemployed nationally. Missouri’s current unemployment rate is 6.1%.

4. Rep. Ann Wagner (R-2): Wagner makes it onto this list due to her emergence as one of the aspiring leaders of the GOP House membership, in which role she stood behind the recent government shutdown, welcoming the “fight” on behalf of “the American people,” while simultaneously trying to lay the blame on the Democrats who, for some inexplicable reason, wouldn’t roll over and play dead after winning a major election. This shutdown cost taxpayers $24 billion at a conservative estimate. Thanks alot, Ann. If Wagner represents the new face of the GOP, the concept needs some work.

5. Governor Jay Nixon: Nixon arguably doesn’t belong on a list filled with boneheads and charlatans – but he landed here because I expect more of him when it comes to looking out for the long-term welfare of the state as opposed to selling us out for a short-term, politically attractive “get.” I’m talking about the Boeing giveaway here. There’s plenty of evidence that massive incentives such as those offered to Boeing are bad economic policy, particularly in a state that like Missouri is already starved for revenue. It leaves a particularly bad taste when one takes into account the sort of underhanded back-room deals that seem to have been required to bring it into being. But no matter how you cut it, $3.5 billion in tax breaks is a bit much to pay in order to buy bragging rights for a handful of jobs – especially when we’re talking about jobs that were probably never going to come  here in the first place. When politicians you have no choice but to trust are influenced by corrupt, corporatist thinking about the allocation of cost and benefit, it makes it just that much harder to believe that change will ever be possible. You want to know why Democrats don’t turn out in off-year elections, why there’s an enthusiasm gap? Look no further.

6. The Greater St. Louis Labor Council: This one hurts. It hurts because it’s more evidence of the demise of labor. It’s clear that Boeing’s effort to spike a bidding war for its 777X manufacturing facility, as the Kansas City Star’s Mary Sanchez noted, is “just leverage for Boeing Co. to go after the jugular of a labor union.”  Now, I’ve always believed that what made unions work was a little thing called solidarity – and that its exercise is not defined in regional terms. Yet not only were local unions willing to undercut their brothers and sisters in Washington, but they quickly squelched Gordon King, a representative of the  local Machinists District 837, when he attempted to stand up and do what union members are supposed to do for each other. When it becomes “my workers first” and not “all workers together,” unions have truly lost the war, and the unbecoming eagerness of the local labor council to kiss up to Boeing is just one more step along the way. I understand the desperation that has brought our local labor leaders to this point, but it still hurts.

7. Rep. Vicky Hartzler (R-4): No list of worsts would be complete with the stench of hypocrisy – of which Hartzler is redolent. And make no mistake, it takes chutzpah to vote to cut the Supplemental Nutrition Assistance Program (SNAP), part of the safety net for the poor, wile keeping sacrosanct massive agricultural subsidies for rich farmers that Hartzler and her family continue to receive. Hartzler, author of a book titled Running God’s Way that is described as “a must-read for everyone interested in serving God through political involvement,” has shown herself again and again to be unwilling to put into practice Christ’s admonition in Matthew 25:34-36 to minister to those in need, and has, instead, allied herself with the wealthy about whom Christ declared “it is easier for a camel to go through the eye of a needle than for a rich person to enter the kingdom of God” (Mark 11:25).

8. Brian Nieves: In a state legislature filled with chuckleheads and bozos, if one had to single out one supreme example of the resentment-fueled, raging white doofus, it would have to be state Senator Brian “Mad Dog” Nieves. Sharia law, Agenda 21, drones spying on farmers, gold-buggery, tentherism, you name it, if it’s crazy Nieves is for it. Add to the mix his eagerness to physically and verbally attack opponents, constituents, you name it, and you’ve got a disaster ready to happen. He’s on this year’s list, though, because he’s one of the brains (and I use the term loosely) who responded to the Sandy Hook massacre by pushing a gun bill so irresponsible that even members of his own party ultimately refused to over-ride its veto by the Governor. In his own words:

… If we, as a nation, would collectively take a few short minutes, maybe even an hour, to actually research what our Founding Fathers said, in their own words, about gun ownership and gun control, we would see that what we arbitrarily refer to as “Assault Rifles” would fit squarely with what they wanted us to have! …

Now that constitutional scholar Nieves has devoted an hour or so to researching the issue, I should probably run out and buy my assault weapon today! Then I can wave it around and act tough just like “Mad Dog.” Just in case you’re worried, there’ll be lots more fun and games ahead. And like last year, very little attention to important business.

Slightly edited for clarity.

Some more thoughts on Boeing, the corporate extortion racket, and real-world decision making

08 Sunday Dec 2013

Posted by Michael Bersin in Uncategorized

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Tags

Boeing, corporate subsidies, Corporate Welfare, missouri, Show Me Institute, Stephen Webber, Tax policy, tax-incentives, United for Missouri

In my earlier post on the way that Missouri politicos are tripping over themselves to try to lure Boeing away from Washington, I noted that a few state legislators were resisting the pressure. In the Missouri House 3 of these stalwarts were Democrats and 17 were Republicans. For those of us with a progressive bent, the question is why the imbalance?

We can assume that the objections on the right side of the isle mirror those of several conservative organizations that lobbied against the Governor’s proposed tax breaks:

United for Missouri, a conservative activist group, took to social media on Monday to call on its members to “Stop the Governor’s Proposed Expansion of Corporate Welfare” […] In a post on its website, the group said the legislature should instead reallocate existing tax credits and pass “broad based” tax reform, not targeted tax credit expansion.

“Does all this mean that Missouri should not try to capture the new Boeing plant? Absolutely not,” the group wrote, “[b]ut the legislature should not expand corporate welfare in doing so!”

The Show Me Institute, a conservative think-tank, also voiced their opposition to the proposal, calling it the “definition of cronyism,” and, like United for Missouri, said they were in favor of broader tax changes like they supported in House Bill 253, legislation vetoed by Nixon that would have slashed corporate taxes and provided fractional relief for individuals.

As much as I loathe what these organizations stand for, I applaud their principled stance and that of the 17 House Republicans against corporate welfare when it is applied in such an unfair and discriminatory fashion. They are right that for every Boeing that is able to throw around enough weight to get what it wants from local governments, there are thousands of small businesses that continue to pay full freight.

Nevertheless, the real issue for these folks isn’t really corporate welfare, it’s the way that it is applied. They want to exempt all businesses – and in some cases, all individuals – from taxes, cut government services to a bare minimum, and if we must have taxes, make them regressive consumption taxes. Their real objection is that tax exemptions for Boeing don’t go far enough, but should be the norm for all business and to hell with revenue to support government that serves the needs of actual people. These are rigidly ideological rather than pragmatic thinkers, espousing an ideology that has revealed itself to be rotten to the core time and time again.

Contrast this stance with that articulated by one of the Democrats, Rep. Stephen Webber, who opposed the Boeing package proposed by the Governor. Webber was aware of the fairness issue, declaring that “we have a lot of hard working business owners in Columbia and I don’t see why we should make them pay more than a multibillion dollar corporation.” He also, however, articulated pragmatic concerns. The Columbia Daily Tribune reported:

But for Webber, the bill was weak, had too many loopholes and gave away too much. “We give away billions and say ‘why can’t we fund the schools?’ ” Webber said. “The answer is right there in this bill.”

There you  have it. The difference between conservatives and liberals in a nutshell. On the one hand, rigid ideologues who will always take the “principled” stand regardless of the real-world consequences for the people who stand to loose or gain the most. In this case, they’re willing to work over one of their corporate allies, but they are just as firm – or even firmer – when the entity to be worked over is part of the 99%. On the other hand, however, we have liberals and progressives who perceive and respect issues of principle, but who are more than anything motivated by the overweening principle that they serve the needs of real, live people.

One can also assume that it is the same type of pragmatism that has led other Democrats to support the Governor’s incentive package. Of course, we know that there are always political survival considerations somewhere in the background, but I think it’s safe to assume that in contrast to Webber, most of the Democrats concluded that the possibility of lots of jobs outweighs the loss of tax revenue and the uncertainty about positive outcomes, as well as any reservations they may harbour about the process.

One may or may not agree about the conclusions these folks have drawn or about Rep. Webber’s rationale, but when we’re between the proverbial rock and hard place – and the pros and cons of the Boeing situation looks a lot like a rock and a hard place to me – we’ll definitely do better in the long run if the folks coming to our aid are at least willing to deal with the real world in something approximating a concrete fashion. Before you can clear your backyard of rocks and hard places you have to be able to get yourself out from in between.

 

Boeing, Missouri and the corporate buyers’ market

07 Saturday Dec 2013

Posted by Michael Bersin in Uncategorized

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Tags

Boeing, corporate subsidies, corporate welfarae, job creation, jobs, missouri, tax-incentives

It’s now a part of commonplace wisdom that globalization and economic slumps in the U.S. have created a buyers’ market when it comes to labor, and that the folks selling their only asset, their time and effort, are at a new disadvantage that is eroding the hard-won successes the labor movement enjoyed in first half of the 20th century. Jobs now regularly move to areas of the world where impoverished and often politically powerless folks cannot afford to make demands – and the power of our own citizens to demand equitable treatment is correspondingly diminished.

We have a national version of the same game going on today, where corporations pit cities, states and regions against each other in bidding wars. The prize is jobs – which may or may not materialize, and which are often yanked away a few years later when a new round of bidding is engendered. The losers are usually the taxpayers who subsidize the enticements that are offered and labor, which is either cajoled or forced to play the part of sacrificial lamb.

This situation is now being played out in Missouri which is desperately trying to lure a new Boeing factory that would most likely bring with it a boatload of jobs. Governor Jay Nixon, who somehow had the internal wherewithal to hold fast against stupid tax cuts earlier this year, is nevertheless in a tizzy to let Boeing walk all over any progressive aspirations he may have fostered – and he is aided and abetted by a legislature where almost all except for a few on the left and right are willing to abandon principle. And we can’t really blame them – the playing board has been tilted to such an extent that this is now the way the game has to be played; until we can change the rules, the Boeings of the world can and will run roughshod over taxpayers and workers.

The Boeing demands, though, are extreme even in this era of compulsive corporate welfare. Notable in the Boeing wish list is the demand that the locale they chose provide the site and facilities at “no cost, or very low cost” and pick up the tab for “infrastructure improvements.” As Matthew Iglesias observes:

That’s a little nutty. If your strategy for attracting the construction of an airplane factory to your town includes footing the entire bill for an airplane factory, then you might as well just launch an airplane manufacturing company. You can read the whole list here. They are ideally looking for a highly skilled yet low-wage workforce at a location with a dedicated railroad spur and a seaport. Plus low taxes!

This situation suggests the following to me:

1. A corporate buyer’s market is not good for the large majority of Americans.

2. Rightwing efforts to enact right-to-work laws, to lower or eliminate corporate taxes, weaken regulations, etc. are intended to create just such a market.

3. This is a problem that progressives have to approach systematically at the federal level. Ameliorating this market situation has to be a major progressive goal that needs to be dealt with in a strategic fashion.

4. Meanwhile, we have to hold the line in the fight against the highly organized network of corporate influence peddlers such as ALEC and its Missouri affiliate, the Show-Me-Institute – and accept the fact that until we have dealt with the issues above, we will loose as often as we win.

5. “Opportunities” like that offered by Boeing will continue to present themselves and we will continue to weaken our social and labor infrastructure until we have dealt with the larger issues.

Years ago I was part of the administration in a non-profit on the West Coast. Our salaries were higher than elsewhere because the cost of living in the San Francisco Bay Area where we were located was also higher. Frequently, staff from one of the East Coast Ivy League schools would apply for jobs in our organization with no intention of accepting. The goal was to get a job offer which they could then take back to their own organization as fuel in salary negotiations, a surefire ploy since their school had an articulated policy of bidding to keep high-performing employees. To say that this left a bad taste in our mouth was an understatement – we were out the time and expense of interviewing candidates in name only. Since we were capable of learning from experience, we soon stopped selecting individuals from this school for interviews. The issue of corporate extortion of the Boeing variety is far more complex, but what this past experience suggests to me is that there are solutions to such problems, although they may be far from perfect. We can learn from experience, and we can develop  strategies for coping.

It is unlikely that Boeing will actually locate in Missouri – we do have some remnants of a labor movement, some few of our legislators realize that they’re playing a chumps’ game, and, most significantly, we don’t have the seaport that figures on Boings list of secondary preferences. Nevertheless, Missouri’s political class needs to learn from this experience and come up with a real job-creation strategy for Missouri that doesn’t involve allowing thuggish corporations to work over Missourians.

*Last sentence edited post-publication. Point no. 2 also edited for clairity.  

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