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One area in which we ought to wish the right wing was prevailing

Sharon DeckerFor years, one area of common ground between conservatives and progressives in North Carolina has been their shared skepticism for business incentives. As analysts and advocates from both camps have shown dozens of times, state and local governments in North Carolina are pouring millions upon millions of dollars down a rat hole on corporate giveaways each year — sometimes just to lure businesses from one county to another.

Over time, the end result is an enormous drain on public resources that breeds cynicism, corruption and special favors and disadvantages homegrown, taxpaying businesses. To make matters worse, virtually every politician who campaigns for public office pledges to reform incentives and then, once in office, finds it impossible to do anything about the problem.

The latest case-in-point is Gov. McCrory who seems bent upon not just using corporate incentives, but dramatically expanding them. If you doubt this, check out reporter Andy Curliss’ article in Raleigh’s News & Observer about the administration’s utterly daft new proposal (given voice by Commerce Secretary Sharon Decker – pictured above) to tax fracking as a way of creating a giant slush fund to attract/bribe corporations:

“Commerce Secretary Sharon Decker said this week the state’s biggest competition in luring business is from Texas, where Gov. Rick Perry has what she called a ‘big slush fund,’ financed by energy taxes, to spend on recruiting companies there. Her comments were to a group of business and community leaders Wednesday afternoon during a question-and-answer session at Robeson Community College near Lumberton.

Decker told the group she wants a similar piggy bank here and that ‘energy partners’ are ready to ‘provide us with the money’ in a climate where increasing traditional funding streams for incentives, such as income and corporate taxes, isn’t likely. She said the money would be used to lure major projects to the state….

In an interview, Decker explained her position on fracking-for-incentive money as aimed at finding a new approach to creating jobs. And she pointed out pending legislation that she said would accomplish that goal.

The bill, SB 127, emerged in the waning days of the legislative session with language she said the administration helped craft that would raise the incentive money from fracking. The bill did not pass as lawmakers said time to study it ran out and they adjourned last week.

Lawmakers are scheduled to reconvene in May and could take up the bill then. There has been discussion recently that McCrory, a Republican in his first term, may call a special session of the legislature to deal with energy and economic development matters.”

Good lord! Talk about a worst-of-all-worlds proposal that turns lemons into sewer water!  Who came up with this idea – Oliver North and his Iran-Contra team?

The bottom line: Let’s hope the conservatives who relentlessly blasted the Easley and Perdue administrations for years on this subject do the right thing by standing up and telling their man in the Governor’s mansion cool-it with the Rick Perry impersonation. Judging however by their performance thus far this session as relentless and shameless cheerleaders for the administration, you’d best not hold your breath while waiting for for such a result.   

 

4 Comments

  1. Doug

    August 2, 2013 at 1:47 pm

    I am right there with you on these schemes to generate headlines. What needs to be done is that small business owners and large companies should be afforded one low tax environment that allows them to both be competitive and hire people of this state.

  2. david esmay

    August 2, 2013 at 4:41 pm

    Once again, there is zero evidence that cutting taxes promotes job growth, but that doesn’t stop conservatives from banging their heads against the wall of reality. What it does promote is greater debt and deficits, the GOP has proven that time and time again.

  3. Doug

    August 5, 2013 at 2:35 pm

    Luckily there are scads of articles on tax increases hindering economic activity and job growth. Just take a gander at the GDP calculation formula. Government outlays hinder the formula.

  4. Doug

    August 5, 2013 at 2:44 pm

    since you will likely not research:
    GDP = private consumption + gross investment + government spending + (exports ? imports)

    Look at P+I+G in particular. Since government spending is confiscated from the first two you naturally have no net increase in gdp if government is doing the spending….it is a zero sum game. Now if government does not confiscate some money and it is used for investment as an example then you can have an increase.

    Thanks for letting me highlight your misinformed state.