reason than the fact that he once wrote "Giving money and power to government is like giving whiskey and car keys to teenage boys." The antics of Barack and the Ivy Leaguers proves this point in spades, but my purpose here is not to take issue with the New York Times business writer and, by coincidence, husband of the former boss of Democratic Party finances who is calling the shots at GM. No, today I would like to address the gullibility of the state and local fools who have been entrusted with our hard earned money in order to pursue 'economic development'.
First, consider the case of LM Glasfiber in Arkansas, which manufactures windmill blades. They have announced another round of layoffs which will take them down to about 300 employees from a high of 630. In spite of the gazillions of dollars with which the economy is being 'stimulated' for just the very sort of global-warming-battling stuff these guys make, "We continue to see the timing of domestic wind projects being pushed back due to the credit markets and world economic conditions," LM Glasfiber vice president and North America general manager Randy Fox said. Orders down = people gone in the minds of stone aged thinkers like Mr. Fox and his Danish overseers, and of course, the economic development people in Arkansas have no way of knowing that the Glasfiber folks are manufacturing Neanderthals.
The real kick in the pants is that the good people of Arkansas gave a lot of money to these guys. "Little Rock city directors agreed to issue $150 million in Arkansas taxable industrial development revenue bonds on behalf of LM Glasfiber. The bonds will help pay for acquiring 130 acres for the company, as well as building office and factory space, and buying equipment for the company for its two plants. The city isn’t liable for paying off the bonds but will hold title to the company’s property, making the land tax-free. Little Rock will lease the land back to LM Glasfiber for 20 years."
The wind turbine business isn't too good up in Pipestone, Minnesota either where Mick Myers, executive director of the Pipestone Chamber and Visitors Bureau got a "smack in the face". "The city overhauled the industrial park within which Suzlon constructed its plant in 2006 and gifted the wind component manufacturer with free land and state and local tax incentives." In exchange the folks running the Suzlon Rotor Corp notified Mick and his buddies by mail that 160 of the 324 jobs the Pipestone taxpayers bought and paid for were being flushed down the Pipestone sewers.
Similar story in Vermont where the Thomas Monahan Company gladly took a hefty wad of cash from the state - then laid off 105 out of 140 folks whose jobs the cash was supposed to secure.
Stories like these abound. The cities ought to get guarantees, you say? They often do - and they are not worth the paper they are written on. Dell seems to be in a class of their own when it comes to raping and pillaging local governments for incentive cash, then tossing the local townsfolk overboard as soon as they hit rough sailing. Local officials in Ireland and North Carolina have been skinned by Dell on incentives for jobs deals, then hauled them into court when Dell has reneged on their promises and slashed 11,600 jobs, but have yet to see a dime. I wish the good folks from Lebanon, Tennessee good luck doing the same.
Government officials need to learn that there are two kinds of manufacturers in this world. There are the headcount driven ones, typically with short-thinking 'professional managers' at the top, like Glasfiber, Suzlon Rotor, Thomas Monohan Company and Dell. You might as well gather all the townspeople together in the city square and burn their money in a community marshmallow roast as give it to these guys. Rather than give them money, you should have companies like this post a bond before allowing them in so you can afford to clean up the mess they will inevitably leave behind.
The other kind of manufacturer is the lean kind - the kind that strives to emulate Toyota - you know, the company that has yet to lay off a single one of their 325,000+ employees despite a global reduction of almost 30% of their market. These companies are worth their weight in gold and the red carpet should be rolled out as lavishly as the town can afford to get them into the community.
Until government officials know the difference, however, we would do well to be sure they have as little of our tax dollars as possible to play with. Otherwise, they will spend it on the likes of Dell and Glasfiber and the local folks will be left with no jobs and no money.