Can Jobs Be Created Without Subsidies, Tax Credits?

Now that the Ice Arena hockey agreement in Janesville is all but sealed, the Janesville Gazette has now turned their attention to promote the lobbying action taken by the private special interest group Forward Janesville. In Sunday's edition, they wasted no time attempting to shape public opinion with the front-page headlines and Webpage story about a small town in Iowa (Newton), who lost their single largest employer (Maytag) and somehow revived itself when they developed a regional plan apparently built on state subsidies and tax credits.

In perfect timing on Sunday, the Gazette’s little sister publication, the Janesville Messenger, also published their promotional frontpage story about the Forward Janesville's lobbying expedition to the state capital.

While just several days earlier, the Gazette also uncritically reported on Forward Janesville’s political expedition to Madison.

So what’s the connection with Newton, Iowa?

Well, last week Wednesday, the politically driven Janesville business group went up to the state capital, hat-in-hand, and unabashedly asked for self-serving tax credits from a state legislature grappling with a $5 billion deficit. The group, comprised of some of the wealthiest businessmen in the region, also expounded upon a regional concept of economic development.

JG Excerpt:
Forward Janesville Priorities:
-- Widening of Interstate 90/39 to six lanes between Madison and the state line.
-- Reforming Tax Increment Financing law.
-- Making state tax credits portable, refundable or saleable.
-- Designating Janesville as a Development Opportunity Zone, which would allow $10 million in special tax credits for job creation and capital investment.

First of all, the expansion of I-39/90 is an idea that does not belong to Forward Janesville, nor does the regional concept of economic development or TIF district reform. But what does belong to Forward Janesville is the request for $10 million in business tax credits and legislation designed to make tax credit portable and saleable enough to shift them around where they see fit. What does this mean for the average Joe? It means the working poor and middle class in Wisconsin will have to accept a greater share of the tax burden. Simply put, the wealthy don't want to pay the taxes and they own the megaphone, they’re asking for waivers. So, under the guise of job creation, Forward Janesville business heavies want to shift taxes. And that in order to pull us out of a hole, these mostly deep-pocketed individuals turn to the government first. So the Gazette uses Newton, Iowa as the first example.

JG Excerpt:
The space didn’t work for TPI, which makes massive blades for wind turbines. With $6 million in state incentives, TPI instead built a 320,000-square-foot plant nearby and employs 350 people, many of them former Maytaggers.

But could TPI have done it without the subsidies?

JG Excerpt:
Didier and Liebl shudder when asked what the local unemployment rate would be if TPI, Trinity, Iowa Telecom and Caleris hadn’t created nearly 1,000 jobs in Newton. “We say that Newton hit the lottery when we landed TPI and Trinity,” Liebl said.

Newton didn’t hit the lottery. The executives, CEO’s and shareholders of those companies are the ones who hit the jackpot with millions in government subsidies. Since they created the jobs, what did they need $6 million in state welfare for? Would those companies have expanded in Newton without Big government intervention?

Those folks, including the Gazette, Forward Janesville and all their supporters really have to take a good long look in the mirror at themselves. They can’t ask for tax breaks and government hand-outs for the few to spur economic development, take credit for the jobs, and then turn around and blame government for higher taxes and the economy.

The truth is, private business groups like Forward Janesville need to return to the basic fundamentals of American capitalism. They need to turn to their own members and lobby them for ideas, economic expansion tools and venture capital. Not the government. They need to consider banks for loans and barter between themselves and stop turning to government for all the answers.

One has to ask: Why aren’t these business folks in south-central Wisconsin hitting up on their man Paul Ryan for some dough? Why? Because Ryan already gave the special interest group a $450,000 federal hand-out for economic development and marketing. And do you know what their first major project was? You guessed it, they mashed together this junket so they could now lobby the state treasury for millions. You gotta hand it to ‘em.

I would not doubt if the WMC-connected Forward Janesville commissioned the WMC-connected Janesville Gazette to write those articles.