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Wisconsin Lawmakers Vote To Pay Foxconn $3 Billion To Get New Factory (arstechnica.com)
An anonymous reader quotes a report from Ars Technica: The Wisconsin Assembly voted 59-30 on Thursday to approve a bill to give incentives worth $3 billion to Taiwan-based Foxconn so that the company would open its first U.S. plant in the state. Foxconn, best known for supplying parts of Apple's iPhones, will open the $10 billion liquid-crystal display plant in 2020, according to Reuters. The bill still has to be approved by a joint finance committee and the state Senate. Both houses of Wisconsin's legislature are controlled by Republicans, and the deal is supported by Wisconsin Governor Scott Walker, a Republican who negotiated the deal. The vote was largely, but not entirely, along party lines. Three Democrats joined 56 Republicans in supporting the deal. Two Republicans and 28 Democrats voted against it. Opponents said the deal wasn't a good use of taxpayer funds. The $3 billion incentives package includes about $2.85 billion in cash payments from taxpayers and tax breaks valued at about $150 million. The state is also waiving certain environmental rules.
Get that? "Cash payments". Not tax cuts. Straight up baksheesh.
We were told how GOP government in Wisconsin was going to create this great economic boom by "unleashing" the free market. Now they're just trying to prop up a Potemkin president by using corporate welfare.
You are welcome on my lawn.
you think a few thousand factory jobs are going to pay $50k-$70k.. hahahaa
They'll start around $35k and probably top out around $55k. The white collar workers might be in the $50k-$70k range... but that might be a few dozen vs a few thousand people.
"Action without philosophy is a lethal weapon; philosophy without action is worthless."
It's not tax credits. It's cash fucking payments.
You are welcome on my lawn.
Only the Republican party crony capitalists should pick winners and losers using tax payer funds.
Poor American down with medical bills due to some high way accident? Shit happens. deal with it.
Taiwanese investors asking for 5 million dollars per job created? Here are the keys to the treasury.
sed -e 's/Chuck Norris/Rajnikant/g' joke > fact
Democratic opponents of the deal have pointed out that paying $3 billion to get 3,000 jobs means the state subsidy amounts to around $1 million per job.
That is just north of $66K for each of the projected 3000 jobs for the nrext 15 years. The jobs are reported to average just over $53K in salary. The full value ($3 billion) only kicks in if Foxconn eventually employs 13,000 workers, but:
Even if the plant never expands beyond 3,000 jobs, though, Foxconn will get $1.35 billion for building the plant. Assuming even the beginning stages of the deal come together, Wisconsin will be paying $500,000 worth of incentives per job.
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I think they target 30 years. Too bad that the factory will close within 10 years. Foxconn already preps for that claiming that there is not enough skilled labor in that region. So why the heck build a factory there? Ah yes, they get to keep all the government handouts.
I'm all for American manufacturing but these high price tag incentives geared at foreign companies for a small number of jobs many of which are temporary looks like a bad idea. There are a supposed 3000 jobs for a 3B price tag or about 1 million dollars per job. It could take as much as 20 years to break even given the tax breaks. Quite frankly I'd be surprised if most of those jobs weren't in building the automated factory, to be discarded after 2-3 years just like the pipeline deals. The manufacturing jobs aren't coming back to the American people unless we count assembly line robots as citizens along with large corporations and actual humans.
Perhaps (and I know I'm absolutely insane), just perhaps, it would be better for Wisconsin to take that 3 billion dollars and start a universal basic income project instead. Instead of 3000 jobs (many of which are low wage and then dissapear) you could support 10,000 people at 21k a year forever at 7% interest.
Apparently that's what the voters want for their state. We can go on and on about "corporate welfare", etc, but it won't make a difference. This is the "wisdom" of the crowd in action. Reason is extremely feeble when pitted against instinct and emotion. Evolution will determine our fate.
“He’s not deformed, he’s just drunk!”
Wisconsin is already spending other states' tax money, because it cannot keep itself afloat. Now it's going to hand that money to China.
"You're right," Fisheye says. "I should have set it on 'whip' or 'chop.'"
Ummm. No? Do people in government really believe this is a good idea? The government shouldn't be doing things like this. Foxconn could be out of business before they even see a profit.
Anyone else remember when Republicans were "The Party of Fiscal Responsibility"?
I guess I just don't understand where making 2.5 billion dollars in cash payments to a foreign company is fiscally responsible.
But what do I know, I'm just another dumb ass liberal.
Given they need to spend $10B in the next 3 years to build the plant, the state gets $560M in sales taxes alone from the construction and another $3-400M as the construction companies pay their workers.
Plus it's incentives, not an outright cash donation.
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Nothing like the smell of pure capitalism in the morning. John Galt (a native of Milwaukee) would be proud!
"Not a good use of public funds" is irrelevant. What's relevant is expansion of corporate welfare and extension of corporate power.
Go Corps!
this has a very long payback, and my first question is, why would we think that a factory making a single electronic component would have any use ten, fifteen, or twenty years from now? What is the plan, or could it even be repurposed if the technology changes, I.e. OLED screens vs LED screens.
Are we looking at another Solyndra?
Does this project have the smell of wrongness that followed the Pfizer at New London project from the beginning?
What company wouldn't want to build a billion dollar high tech factory in a state where people walk around with blocks of cheese on their heads?
Yay corporate welfare! Fuck the taxpayers! Rich get richer, debt gets deeper. Yay capitalism!
If your state is facing such desperate unemployment levels that you have to pay the full salaries of Foxconn's employees for decades to create the jobs... then why not just hire people into government jobs where the public reaps the benefits of the work? Create the nation's shortest DMV lines, fully-staffed parks, cleanest sidewalks, etc. Doing so might actually bring in more employers.
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The jobs are reported to average just over $53K in salary.
Okay, so what's the median salary?
There's a difference between 3000 people earning $53K each and a few people earning $1M+ with everyone else getting minimum wage, even if both scenarios result in an "average" of $53K.
=Smidge=
But there are at least two important points to consider. 1. The $3 billion wouldn’t be a gift, as One Wisconsin Now calls it. That’s the maximum amount the state would pay Foxconn, and only if the company spends roughly $18 billion -- about $9 billion for payroll and $9 billion in capital investments.
Except the first linked article mentions cash payouts. Why use the words, "cash payouts" if that's not what is going on? It even separates out cash payouts and tax incentives.
I stand corrected. It took me a bit of digging, but the cash payout thing is entirely false, apparently. It's all tax incentives in one form or another..
from the taxpayer and giving it to people who don't do any work. What gives you the right to tax me and make me pay so you don't have to work? That's just theft, plain and simple. But these foxconn guys? They're creating jobs. This isn't a handout, it's an investment.
Or so the argument goes. The folks who actually make it to the polls to vote might actually believe that. The folks that don't believe that horseshit generally have their vote suppressed. During the last election there were reports of 10 hour waits to vote in working class districts. Or any district that might go against the pro-corporate, pro-right wing party.
Basically we're a pretend Democracy. No different than North Korea really except we've got enough money to throw around that the worst of the poverty is kept at bay.
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Yeah, it's $230K per job if you calculate $3billion for the 13,000 proposed jobs created.
It's "tax rebates" paid in hand and which you do not have to pay back if you never end up with the required amount of tax liability.
In other words, it's cash payments + a bunch of lies so they can deny it.
At 53K per year, you're in the 25% tax bracket. Let's see what happens if a majority portion of the workers earn $35K instead of $53K to allow for some few dozen padded executive salaries.
2900 @ 35,000 is 101 million, plus 100 million for 100 million dollar packages. 101 million @ .25 ($25 million) and 100 million @ .396 ($39.6 Million) for a total tax income burden of $64.6 million; versus 53,000 * 3000 for 159 million @ .25 for a total income tax burden of $39,750,000.
Happiness in intelligent people is the rarest thing I know.
Ernest Hemingway