Texas Liberal Activist Government Picking Winners

[TH3]

"Texas offered Toyota $40 million to move, part of a Texas Enterprise Fund incentive program run out of the governor's office. At $10,000 a job, it was one of the largest incentives handed out in the decade-old program and cost more per job created than any other large award.

Last year, Texas spent about $6,800 to lure each of 1,700 Chevron Corp. CVX +1.40% positions to Houston and $5,800 for each of 3,600 Apple Inc. AAPL +3.87% jobs shifted to Austin."

 

Guess it ain't liberal if its good for you!

Edited April 29, 2014 by baskin

[Gary M]

"Texas offered Toyota $40 million to move, part of a Texas Enterprise Fund incentive program run out of the governor's office. At $10,000 a job, it was one of the largest incentives handed out in the decade-old program and cost more per job created than any other large award.

Last year, Texas spent about $6,800 to lure each of 1,700 Chevron Corp. CVX +1.40% positions to Houston and $5,800 for each of 3,600 Apple Inc. AAPL +3.87% jobs shifted to Austin."

 

Guess it ain't liberal if its good for you!

 

 

Smith Electric Vehicles $30mil US funds closed

Solydra $850 mil US funds closed

Which of these was good for anyone , other than the guys who profited before they closed?

 

More here:

 

http://money.cnn.com/2012/10/22/news/economy/obama-energy-bankruptcies/

[Azalin]

 

"Texas offered Toyota $40 million to move, part of a Texas Enterprise Fund incentive program run out of the governor's office. At $10,000 a job, it was one of the largest incentives handed out in the decade-old program and cost more per job created than any other large award.

Last year, Texas spent about $6,800 to lure each of 1,700 Chevron Corp. CVX +1.40% positions to Houston and $5,800 for each of 3,600 Apple Inc. AAPL +3.87% jobs shifted to Austin."

 

Guess it ain't liberal if its good for you!

 

if you knew anything about republicans and conservatives in Texas, you'd know that the vast majority are against any form of corporate welfare, which is exactly what this is. Perry is always being critisized for his enterprise fund, as most believe that any surplus (which, by the way, is achieved without a state income tax) should be refunded to the taxpayers.

 

but by all means, keep up the charade that you're a pragmatic, independent-minded republican, frustrated by the party's inability to see things in the same sensible manner as you.

Edited April 29, 2014 by Azalin

[3rdnlng]

"Texas offered Toyota $40 million to move, part of a Texas Enterprise Fund incentive program run out of the governor's office. At $10,000 a job, it was one of the largest incentives handed out in the decade-old program and cost more per job created than any other large award.

Last year, Texas spent about $6,800 to lure each of 1,700 Chevron Corp. CVX +1.40% positions to Houston and $5,800 for each of 3,600 Apple Inc. AAPL +3.87% jobs shifted to Austin."

 

Guess it ain't liberal if its good for you!

 

 

Your true colors are apparent but that doesn't preclude you from posting a link to the things you quote.

[TH3]

Your true colors are apparent but that doesn't preclude you from posting a link to the things you quote.

 

You really need the link? Seriously?

 

What do you think my "true colors are"?

 

if you knew anything about republicans and conservatives in Texas, you'd know that the vast majority are against any form of corporate welfare, which is exactly what this is. Perry is always being critisized for his enterprise fund, as most believe that any surplus (which, by the way, is achieved without a state income tax) should be refunded to the taxpayers.

 

but by all means, keep up the charade that you're a pragmatic, independent-minded republican, frustrated by the party's inability to see things in the same sensible manner as you.

 

My point is that NEITHER party is what I would think of as "conservative". The GOP is as activist and as involved in picking winners as the DEM's.

 

Yes there are the Solyndra's but he biggest source of economic activism is the tax code - and that is what I find disappointing about Ryan's budget proposal - it makes NO moves to reform the the revenue side of the budget.

 

Federal tax revenues are pretty much at an all time low - 17 percent GDP (excluding 2002-2012- the Bush tax cut years - 15%) - so why do we all complain about paying high taxes? (BTW Reagan years taxes were 20+ percent of GDP).

 

The reason is - the tax code has been formed by special interests on BOTH sides of the aisle......

 

My true colors? Make sure you walk the walk (GOP) before you talk the talk......

[B-Large]

You really need the link? Seriously?

 

What do you think my "true colors are"?

 

 

 

My point is that NEITHER party is what I would think of as "conservative". The GOP is as activist and as involved in picking winners as the DEM's.

 

Yes there are the Solyndra's but he biggest source of economic activism is the tax code - and that is what I find disappointing about Ryan's budget proposal - it makes NO moves to reform the the revenue side of the budget.

 

Federal tax revenues are pretty much at an all time low - 17 percent GDP (excluding 2002-2012- the Bush tax cut years - 15%) - so why do we all complain about paying high taxes? (BTW Reagan years taxes were 20+ percent of GDP).

 

The reason is - the tax code has been formed by special interests on BOTH sides of the aisle......

 

My true colors? Make sure you walk the walk (GOP) before you talk the talk......

 

I would argue taxes are fairly low in relation to spending... i know, I am a genius.

 

I wonder how many years we can go on having taxes that do not come close to pay for services....

 

the 2008 Stimulus cost what 200K per job/ job saved- $10K seems like a bargain...

Edited April 29, 2014 by B-Large

[Azalin]

My point is that NEITHER party is what I would think of as "conservative". The GOP is as activist and as involved in picking winners as the DEM's.

 

if that's your point, then you picked a bad example with which to make it. the enterprise fund isn't about 'picking winners', it's simply a lure for businesses to either relocate to Texas or to open new plants/facilities here. the conservative or liberatarian argument with it is that Texas already has a pro-business tax structure and further incentive shouldn't be necessary, especially when the taxpayer money being used never makes it's way back to the taxpayers in any direct fashion.

Edited April 29, 2014 by Azalin

[GG]

.... especially when the taxpayer money being used never makes it's way back to the taxpayers in any direct fashion.

 

If Toyota decides to locate the plant in Texas, the state would benefit from addition of $200 mil - $300 mil in new salaries to flow back into the state economy, plus whatever additional economic activity that the plant would generate.

 

To compare the entreprise fund to the big topic on the main board, Texas will get a hell of a lot more mileage from their $40 mil investment in a Toyota plant than NYS will get out of its $120 mil deal to refurbish the Ralph.

[Azalin]

If Toyota decides to locate the plant in Texas, the state would benefit from addition of $200 mil - $300 mil in new salaries to flow back into the state economy, plus whatever additional economic activity that the plant would generate.

 

To compare the entreprise fund to the big topic on the main board, Texas will get a hell of a lot more mileage from their $40 mil investment in a Toyota plant than NYS will get out of its $120 mil deal to refurbish the Ralph.

 

indeed, but again, the tax structure here is already quite friendly to business. Toyota opened a plant in San Antonio just a few years ago where they crank out Tundras & Tacomas hand over fist, and they didn't need any extra cash slapped into their palms to incent them to do so. now all those new salaries are being earned by Texans, who in turn pump their wages into the local economy and increase the tax base. no money from the enterprise fund was necessary for that to happen. the enterprise fund is an extra incentive which is funded by the overpayment of taxes to the Texas government, which should, in most conservative or liberatarian eyes, be refunded to the taxpayers instead of being used to bribe a company into operating here, where taxes and wages are already low enough to make the state an attractive place to conduct business.

 

it's one thing to provide incentives to woo companies into locating to your area by making it easier for them to operate. it's another to just pay them to come to town.

Edited April 29, 2014 by Azalin

[Gary M]

indeed, but again, the tax structure here is already quite friendly to business. Toyota opened a plant in San Antonio just a few years ago where they crank out Tundras & Tacomas hand over fist, and they didn't need any extra cash slapped into their palms to incent them to do so. now all those new salaries are being earned by Texans, who in turn pump their wages into the local economy and increase the tax base. no money from the enterprise fund was necessary for that to happen. the enterprise fund is an extra incentive which is funded by the overpayment of taxes to the Texas government, which should, in most conservative or liberatarian eyes, be refunded to the taxpayers instead of being used to bribe a company into operating here, where taxes and wages are already low enough to make the state an attractive place to conduct business.

 

it's one thing to provide incentives to woo companies into locating to your area by making it easier for them to operate. it's another to just pay them to come to town.

Companies pay employees moving expenses all the time, is this much different?

[Azalin]

Companies pay employees moving expenses all the time, is this much different?

 

some companies do, and some don't. the ones that do use company (their own) funds to do so. governments don't have money of their own. they have to take it from people. if they have money left over after all budgetary obligations are met, then as far as I'm concerned, the surplus should go back to the citizens directly.

 

if you wish to have a more business relocate to your area, it makes more sense to me to make the business climate more attractive for everyone, instead of bribing one or two companies to do so. Texas is not in a position where it needs to resort to things like this to attract business. last time I checked, we were way above the national average in terms of jobs & economy.

[Tiberius]

 

 

 

the 2008 Stimulus cost what 200K per job/ job saved- $10K seems like a bargain...

 

Apples and Oranges. These jobs already existed. The stimulus was designed to create jobs out of thin air and the money spent on creating them flowed into the economy also creating more jobs, you know, to stimulate the economy

 

 

 

If Toyota decides to locate the plant in Texas, the state would benefit from addition of $200 mil - $300 mil in new salaries to flow back into the state economy, plus whatever additional economic activity that the plant would generate.

 

To compare the entreprise fund to the big topic on the main board, Texas will get a hell of a lot more mileage from their $40 mil investment in a Toyota plant than NYS will get out of its $120 mil deal to refurbish the Ralph.

I agree with everything here except the last part. NYS is also doing other things to attract jobs and Texas is probably doing some public support for stadiums Like Bush's Rangers. Nice NY bashing

[3rdnlng]

Apples and Oranges. These jobs already existed. The stimulus was designed to create jobs out of thin air and the money spent on creating them flowed into the economy also creating more jobs, you know, to stimulate the economy

 

I agree with everything here except the last part. NYS is also doing other things to attract jobs and Texas is probably doing some public support for stadiums Like Bush's Rangers. Nice NY bashing

 

Again, you've got nothing.

[GG]

it's one thing to provide incentives to woo companies into locating to your area by making it easier for them to operate. it's another to just pay them to come to town.

 

In a vacuum, that would work. But Texas also competes against the other 56 states, notably Alabama, Tenn, Ark & South Carolina for the plants. It's not as simple as to look at the amount the state spends to attract the business and say it's money down the drain. You have to analyze the full impact of economic growth if the business chooses to stay in Texas. Of course that is not to say that states should chase all businesses - there are many, like stadiums, film making, etc that are bigger on the vanity scale than they are on the economic scale.

[Azalin]

In a vacuum, that would work. But Texas also competes against the other 56 states, notably Alabama, Tenn, Ark & South Carolina for the plants. It's not as simple as to look at the amount the state spends to attract the business and say it's money down the drain. You have to analyze the full impact of economic growth if the business chooses to stay in Texas. Of course that is not to say that states should chase all businesses - there are many, like stadiums, film making, etc that are bigger on the vanity scale than they are on the economic scale.

I'm not saying that paying a company to come set up shop in your state won't help bring jobs and help economically within the community, I'm simply saying that handing a cash bonus to a company to do so is not something I believe in doing. I believe that providing an attractive setting for a business to operate within is enough. speaking specifically to Texas, we already have an attractive climate for business, so in my opinion, further incentive is unneccessary. if Texas wants to place further incentive, it should lower the corporate tax burden further, not send gifts in the form of overpayments from it's citizens.

Edited April 30, 2014 by Azalin

[GG]

I'm not saying that paying a company to come set up shop in your state won't help bring jobs and help economically within the community, I'm simply saying that handing a cash bonus to a company to do so is not something I believe in doing. I believe that providing an attractive setting for a business to operate within is enough. speaking specifically to Texas, we already have an attractive climate for business, so in my opinion, further incentive is unneccessary. if Texas wants to place further incentive, it should lower the corporate tax burden further, not send gifts in the form of overpayments from it's citizens.

 

Without the incentive, it may be more beneficial to Toyota to locate in Tenn, and Texas would lose out in the long term. You can also look at the one time inducement funded by the taxpayers as the upfront payment for taxes to be received down the road. At the end of the day, it should be the same net cash effect to the state as lowering the tax rate. The biggest difference is that in an inducement, one company benefits disproportionately. There is logic in that, because the hope is that if Toyota bases enough operations in Texas, it would be easier for it to continue expanding in Texas vs expanding in other states.

[Azalin]

Without the incentive, it may be more beneficial to Toyota to locate in Tenn, and Texas would lose out in the long term. You can also look at the one time inducement funded by the taxpayers as the upfront payment for taxes to be received down the road. At the end of the day, it should be the same net cash effect to the state as lowering the tax rate. The biggest difference is that in an inducement, one company benefits disproportionately. There is logic in that, because the hope is that if Toyota bases enough operations in Texas, it would be easier for it to continue expanding in Texas vs expanding in other states.

 

well, Toyota already has an established footprint here. it's not like Texas is trying to get them to start setting up initial operations. it's a right to work state, and as far as I know the San Antonio plant isn't unionized, but they pay well and have an excellent reputation in the community. Texas has already proven itself worthy. I see no need to sweeten the pot....Toyota already has a good thing going here.

 

in your example, you say that the net effect of using money from the enterprise fund should be the same as lowering the tax rate, but my disagreement with that is that despite a similar effect with regard to making it more attractive for Toyota, it's doing so at an additional cost to the taxpayer. remember that the enterprise fund is just a creation of the governor, and is comprised of surplus taxes. if the taxpayers had the opportunity to vote on whether or not they wish those overpayments to go into the enterprise fund, I'd have no problem with it. the fact that taxpayers have no direct say in how those overpayments are used is a problem for me. to be honest, I'm surprised it's not a problem for more people. from my point of view, it smacks of corporate welfare.

Edited April 30, 2014 by Azalin

[GG]

Harsh realities of state decisions on economic matters.

 

Five weeks ago, Torrance, Calif., Mayor Frank Scotto was celebrating the opening of the city's new athletic fields with officials of Toyota Motor Corp. The city's biggest employer and a prime benefactor had given a half-million dollars toward the project.

 

This week, Mr. Scotto has had a less pleasant duty to perform: Figuring out how Torrance can fill the 101-acre hole the giant auto maker will leave behind when it vacates its sprawling campus and moves 3,000 jobs to a new North American headquarters in Texas.

Edited May 1, 2014 by GG

[Azalin]

Harsh realities of state decisions on economic matters.

 

from what I've heard, it's expensive to do business in California. that being the case, more companies will move away unless the state makes it more desireable for them to stay. Toyota is by no means the only company to relocate facilities from California to Texas in recent years.

 

back to my point, I don't like Texas using surplus taxes as a fund with which to bribe companies into relocating here. I don't doubt for a second that Perry is doing this simply to claim all the jobs he 'created' in Texas as he takes another run at the presidency.

[Joe Miner]

 

from what I've heard, it's expensive to do business in California. that being the case, more companies will move away unless the state makes it more desireable for them to stay. Toyota is by no means the only company to relocate facilities from California to Texas in recent years.

 

back to my point, I don't like Texas using surplus taxes as a fund with which to bribe companies into relocating here. I don't doubt for a second that Perry is doing this simply to claim all the jobs he 'created' in Texas as he takes another run at the presidency.

 

I don't have a huge issue with a state that can actually pay for something that will have a positive ROI.

[3rdnlng]

I don't have a huge issue with a state that can actually pay for something that will have a positive ROI.

 

40 million for 5000 well paying jobs is paid back quickly in sales tax, increased real estate tax and other things like more licensing fees. California, the way things are presently set up will only have industries that cater to their state and nearby interests, other than the ports.

[TakeYouToTasker]

 

 

I don't have a huge issue with a state that can actually pay for something that will have a positive ROI.

I don't think anyone would oppose government activism under those circumstances. The problem is that governments aren't run like businesses, and aren't comprised of business people. Governments are run by politicians who are more concerned with messaging than bottom lines, and they aren't investing their own money, so losses aren't necessarily of consequence. As a result, governments tend to do a very poor job with these sorts of things, which is why people oppose it.

Edited May 2, 2014 by TakeYouToTasker

[Joe Miner]

I don't think anyone would oppose government activism under those circumstances. The problem is that governments aren't run like businesses, and aren't comprised of business people. Governments are run by politicians who are more concerned with messaging than bottom lines, and they aren't investing their own money, so losses aren't necessarily of consequence. As a result, governments tend to do a very poor job with these sorts of things, which is why people oppose it.

 

Not disagreeing with that.

 

I am pretty sure if I looked at the state budget of Texas I could find dozens of areas where they wasted money that would make me more upset than this.

 

I have more trust my 4 year old to handle money than I do Govt on any level.

 

If I was a state Govt I'd make sure my state was a great place financially for a company to do business, and then I'd start poaching stable and successful companies from states like CA.

 

Is not picking winners. It's identifying existing winners and relocating them to your state.

[B-Man]

Wretched Refuse

 

By Kevin D. Williamson

 

It’s no surprise that more of the people who move to Texas come from California than from any other state; more of the people who move to California come from Texas than from any other state. California, Texas, Florida, and New York exchange a great many people among themselves, because they have a great many people to exchange.

 

What is interesting in the IRS data is this: The people moving from California to Texas have significantly higher incomes than those making the opposite trek: about $56,000 per tax return for the Texas-bound vs. about $50,000 per tax return for the California-bound. And that doesn’t even take into account the radically different cost of living in the two places: The median home in Texas sells for $128,000 vs. $383,900 in California, $124,700 in Houston vs. $470,000 in Los Angeles. The median California home costs 6.25 times the median California household income, while the median Texas home costs 2.48 times the median Texas household income. Those people moving to Texas are getting a big raise in real terms; the ones moving to California are taking a pay cut. For young people, the lifetime returns to Texas’s lower cost of living can be substantial: Even an extra $2,500 a year in savings throughout your twenties means a couple of hundred thousand more in your retirement account at 65.

 

Perhaps more significant, the typical person moving to California (total domestic and foreign migration) makes about $13,000 less than does the average established California household, whereas the typical Texas transplant lags the state’s average by only about $6,000. Movers tend to be younger people, earlier in their careers with lower incomes, but the ones moving to Texas will have less catching up to do. Also of interest: Foreign immigrants to California have lower incomes than the average, but foreign immigrants to Texas have substantially higher incomes than the average — nearly $12,000 more.

 

Bottom line: In the 2010-2011 exchange of residents between Texas and California, Texas came out $379 million ahead in AGI. It does not seem likely that that trend will be reversed when data for more recent years is available.

 

California: Give them your poor, your huddled masses yearning to pay the nation’s highest personal income tax, highest sales tax, second-highest gasoline tax . . .