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Monday, April 16, 2018

Why Not Impose Walker-Foxconn 17% Statewide Income Tax To Fund Government-Run Economy?

With the impending demolition of the GM plant in Janesville, the "free market conservatives" at the Janesville Gazette posted a new editorial asking Gov. Scott Walker to offer the same free government cash deal the state gave to Foxconn - to developers and hopeful companies considering the former GM site.

Don't worry Gazette comrades, the same free government cash including the environmental exemptions the state gave Foxconn is available to any and all developers and corporations simply for the asking. The recent Foxconn-like package state republicans offered to Kimberly-Clark is evidence for my claim.

Despite a state-based "free market" group's assertion that the Kimberly-Clark package died in the state Senate because of "principled free market" republicans and their laughable spin job to credit those republicans for the demise of the pay-to-stay proposal, the deal remains now and forever on the table. The senate merely pulled the deal while playing a cat-and-mouse game with KC executives. That's what happened.

To put it another way, if anyone believes principled state republicans were responsible for killing a deal meant to prevent KC from pulling out of Neenah, Wisconsin's corporatized media would have hung and burned those republicans in the public square for the loss of 600 jobs. You know it. I know it.

But that's not how or why the KC deal was rejected. Walker and state republicans simply did not want to have their Foxconn deal further exposed for the desperate sham that it is, so they had to move it for appearance's sake. The accepted media-spun narrative gives the state just enough wiggle room to keep the corporate welfare charade alive. The establishment demands it.

But ultimately, it was KC who walked away from it, not republicans.

So let's be blunt. The state's "pocketbook" as the Gazette likes to put it is your wallet, my wallet, your paycheck and my paycheck. The Foxconn deal at its core is based on state taxpayers ultimately funding a government-run re-distributive process that returns 17% of a Foxconn employee's paycheck - back to the employer. If Foxconn employs the minimum amount of workers (3,000) according to the contract, the state promises to ship on average about $200M CASH each year for the next 15 years to the Taiwan based corporation. That's an accurate but basic overview of the "tax credit" part of the Foxconn deal.

If the Gazette believes (they do) Foxconn-rate subsidies for the GM site are the way to go, those deals should be institutionalized for the entire state. Why not? If a little is good - a lot is better.

But the state should depoliticize the process and stop picking winners and losers. They can do that by imposing a new 17% state income tax on everyone. The new income tax would provide dedicated funding for redistribution back to all employers. That way, states can compete in a principled conservative "free market" against each other for more jobs by simply upping the tax and cash back subsidies to 18, 19, 20% or more.

It'll be glorious.

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