So The (Columbia, S.C.) State newspaper ran a big story this week in which it was shocked … shocked, we say … to discover large corporations were basically purchasing taxpayer-funded incentives from members of the S.C. General Assembly.
The tab? An estimated $800 million for just four companies – BMW, Boeing, Bridgestone and Michelin – since 2008. All of it bought for the bargain basement price of $600,000 in campaign contributions (and $228,000 to the Republican and Democratic caucus organizations in the S.C. General Assembly).
This, of course, is the same crony capitalist approach to job creation which produced the recently concluded “Lost Decade” – and which is continuing to run our state’s economy into the ground.
How come? Because bribing companies to come to South Carolina winds up shifting (and raising) the tax burden on existing businesses as well as individual taxpayers. Oh … and sometimes these companies fail to create any jobs at all.
Bummer, right? Only if you’re a taxpayer … lawmakers are living high on the hog as a result of these corrupt deals.
And in addition to the money that goes to their campaign accounts and their political parties, in many cases they are being bought hired directly by the companies seeking preferential treatment.
“There is no limit to the amount you can give a lawmaker or local official,” said former state Sen. Mike Rose told the paper. “You just hire him.”
Or her …
In fact the most egregious example of a lawmaker being “paid to play” is S.C. Gov. Nikki Haley (here and here).
Which is why it’s funny Haley now thinks she’s some sort of champion for ethics and transparency (a hypocrisy we’ve addressed in detail in previous posts).
“Governor Haley feels the best policy is full disclosure,” her spokesman said this week. “She has no problem with businesses being allowed to donate to candidates, as long as those donations are fully disclosed to the public.”
Really?
Then why did then-Representative Haley wait until two weeks after the 2010 GOP primary election – and mere hours before Republicans voted in a runoff election between her and former U.S. Rep. Gresham Barrett – to disclose that she had been paid $40,000 by a company with business before the state?
Good question …
S.C. Rep. Kirkman Finlay (R-Columbia) has been aggressively pushing a broad income disclosure bill that would keep politicians like Haley from hiding their special interest payoffs in the future.
Let’s hope his efforts are successful …
More to the point, let’s hope taxpayers and small businesses are successful in getting the tax relief they’ve been denied for far too long as a result of all these special interest handouts.
20 comments
So we spent $800 million to get 4 major businesses to move to SC. How much will the state make on the payroll taxes paid by these companies employees? How much on sales tax? How much will it make on the electricity tax these companies pay? The phone taxes that these companies pay for phone services? The car taxes paid by the companies for fleet vehicles? I’m willing to bet it’s a net profit to the state.
Many years of Republican government have created the “business paradise” known as South Carolina. Why then can we only manage to get companies to build or relocate here with bribes? No matter what you say — “incentives” are what were formally known as “bribes.” We need to clean house in Columbia — but it won’t happen. The same malefactors will be on the ballots next year — and all the sheep will say “Baaa.”
“Why then can we only manage to get companies to build or relocate here with bribes?”
Could it be that companies perceive SC as a tiny state with a population of uneducated morons, has no culture, no major cities, no industry of any kind, a history of racism, and it has a crime problem? No. You’re right. If we didn’t offer incentives, companies would be dying to move from NY or Boston, or LA or Austin, or PA to come to a state with such a great reputation. I mean Boeing would’ve totally moved here from Washington just for the weather.
Washington is doing a great job of bribing Boeing too, better than SC.
Wait! Per Sic Willie, only SC does that.
Jackie, Jackie! How many times do you have to be told? Do NOT apply logic to Sic Willie’s agenda.
“So we spent $800 million to get 4 major businesses to move to SC.”
I always question the difference between “spending” and “tax breaks” in reporting.
I know most here don’t see the difference, but to me, philosophically it is much different to give money to large corporations that was taken from the “little people” versus giving them tax breaks. I find former abhorrent.
What is also abhorrent/disingenuous though, is calling something a “subsidy” if it is a tax break. Which are two entirely different things.
It’s also hard to know in these write ups if what is “given” is a tax break, which simply means a company gets to keep more of the money it makes or truly a subsidy(redistribution of wealth).
Sometimes to two figures are co-mingled with terms by people and its important to distinguish one from the other if there is any hope of having a decent philosophical debate over the issue.
So for example, did taxpayers stroke a $800 million check to these companies? Or did they stroke $400 million and give the tax breaks for $400? Or was it all tax breaks?
This is an important but seemingly unanswered question.
edit: “Sometimes THE two figures”
However you parse it, it doesn’t adhere to Fits definition of free enterprise where there is no government involvement. We know that Fits believes that the chemical and other business will clean up their toxic waste sites because it is good for them.
“However you parse it, it doesn’t adhere to Fits definition of free enterprise where there is no government involvement.”
I really have no idea how Sic Willie defines free enterprise. Just like the “core functions of gov’t” stuff, it seems to be random.
That being said, tax exemptions are at least a start to “no gov’t” I suppose, the irony being you have to deal with gov’t to even get such a grant(currently).
“Fits believes that the chemical and other business will clean up their toxic waste sites because it is good for them.”
Again, I really don’t know what Sic does or doesn’t believe.
I can say though that a libertarian(small l) perspective would be one under which someone who owns a land site and makes it toxic would have the freedom to do so if it doesn’t harm anyone else.
How often would someone be able to do that without causing harm to someone else and the requisite liability as a result? Probably rarely.
If we assume Sic is a capital “L” Libertarian, I’m guessing the government courts would handle such damage/charges brought by someone harmed from such…I don’t know where the capital L’s draw the line on EPA stuff and their set of autocratic codes for example.
Unless you have some numbers to back up your bet, you are bluffing: or worse.
Studies indicated that the Boeing plant alone could release as much as $5.9 billion PER YEAR into the S.C. economy. http://www.postandcourier.com/article/20100521/PC05/305219944
It appears that figure was downgrades to $4.6 billion in 2013. http://siteselection.com/aerospace/2013/may/boeing-expansion.cfm
Under either calculation, that much economic activity is a major tax revenue generator.
The state offered BMW roughly $130 million in tax benefits. From 1992 to 2002, the combined tax benefit to the state government was $27.6 million in each year. If those figures remained constant, that would mean that a $130 million investment generated $552 million in tax income over 20 years. That’s not including the $2.4 million in tax revenue to county governments and $3.1 million to the school districts.
http://mooreschool.sc.edu/UserFiles/moore/Documents/Presentations%20&%20Studies/2002%20BMW.pdf
Gracias.
You have to have the financial backing to pursue these jobs and become rich. I think we should form a government and really take all the wealth and really redistribute it.
Yes Way!!!!! They are for sale, especially Haley! She is a liar and a fraud, has been and always will be!
We are now finding out what a liar and fraud Obama is. His re-election was a tremendous mistake!
Please people, let us not make the same mistake with Haley! As a matter of fact, we need to send all of the lying, cheating freeloaders a message…YOU’RE FIRED!!!!
They’re not common prostitutes – they give it away!
To Governor Haley “dis-clothier”
Is a topic heaven-sent.
It’s cut-rate female fashions,
Some for sale and some for rent–
Just like the politicians
Who loiter in our halls.
There’s misses, sixes, jumbos;
There’s mediums and smalls.
They drive their flashy Bimmers
To a carbon-fiber plane.
They all want to be winners,
So they’ll beg for funds again.
And again. And again……
I have no problems with large companies subsidizing Cockroaches. In fact I wish they would increase their contributions and consider payments to spouses, kids and every family member related by blood or marriage
Confident this will not help out on the taxes I am paying but it will reduce the number of Cockroach dicks up my ass
They do the same thing House Speaker Bobby Harrell does, they use campaign contributions for their own personal desires. They cook the books to cover it up. But it is what they do. A good investigative reporter can crack it all wide open if they dig really really hard into the matter.
Every time I go to the State House, I feel like taking a bath when I get home.
The place is absolutely corrupt.
There are a very few patriots who are putting their political carrers on the line for SC Citizens. The rest are just there for what they can steal.
There should be term limits on all of them.