FOXCONN is bad for Wisconsin BLUF part #2
Is FOXCONN bad for Wisconsin? Why do we give millions to sports teams? Why was it ok for President Obama to give millions to Solyndria? Why is it a good practice for Governor Andrew Cuomo of NY to offer tax incentives to companies? How many dollars is Wisconsin actually handing to FOXCONN? Should the Wisconsin Democrats oppose this, and if they do what does that say? What if the Republicans are wrong? I’m confused because I think it should be what is best for Wisconsin, or am I wrong?
TRICKLE DOWN: Ouch that must hurt the ears of the liberal progressive community. The term TRICKLE DOWN is like squeaking chalk on a blackboard for those old enough to remember the sound. Once FOXCONN is up and running its estimated that it will require $4.26 billion in supplier purchases annually, with about 33% from Wisconsin suppliers. There will be businesses that will spring up that do not exist today which will support the workers and the business. (NOTE: These businesses will employ people and all will pay taxes) FOXCONN will partner with Milwaukee’s Rockwell Automation and some other Wisconsin companies named are Scanalytics Inc. of Milwaukee and another is Akitabox of Madison to name a few.
TAXES: The average salary before benefits is said to be $53,000 per year so the taxes paid to Wisconsin is $2,300 X 3000 employees is $6,900,000, and if they actually employ 13,000 employees that is $29,900,000. Do not forget the other businesses that will employ additional employees and new businesses which will all employ additional people who pay taxes. It is estimated that between FOXCONN and ancillary support businesses over 20,000 tax paying jobs will be created in Wisconsin, all paying taxes.
WISCONSIN PAID: How much money did Wisconsin actually give to FOXCONN? According to what I read the billions referred to are labeled as tax credits for jobs created, credits for capital investment and sales tax exemptions on construction materials, and pay no corporate sales on products made here. So Wisconsin gave FOXCONN no actual dollars up front but to lure FOXCONN, Wisconsin will have a windfall of taxes paid by support business and their employees, plus FOXCONN employees. If FOXCONN was not in Wisconsin those 20,000 employees would not be paying taxes to Wisconsin. Trickle down??
CAUTION: Senator Hanson of Green Bay was criticized but he spoke of caution because FOXCONN has a history of over promising and under performing. Examples are commitment to Brazil to invest $12 billion but never came close, they committed to spend $5 billion in the Indian state of Maharashtra so far nothing, FOXCONN was to invest $10 billion in Indonesia but shaved that down to $1 billion, and four years ago they claimed they would spend $30 million on a Pennsylvania plant but failed to follow through.
AUTOMATION: Certainly every business that can is using (converting to) automation today and so will FOXCONN. But if automation was the answer FOXCONN would have remained in those other countries. One element cited besides the tax incentives was the work ethic of Wisconsin workers.
CONCERN: Wisconsin unemployment is at 3.2% so my fear is that there will not be enough Wisconsin residents. Illinois, specifically Chicago is just across the border so how many will come from the south and how many will actually move to Wisconsin. If they move to Wisconsin will they bring their liberal progressive desires with them?
OPTIMISM: As I understand it Wisconsin will never actually give FOXCONN any dollars but at the same time will not collect tax dollars from FOXCONN. The company and supporting business will employ around 20,000 tax paying Wisconsinites. No FOXCONN in Wisconsin and 20,000 people are not paying taxes in Wisconsin. What about new homes and apartments to house workers that choose to live in the area?
We do not know, what we do not know, but I have always lived by the phrase, “it is better to attempt to something great and fail, than to do nothing at all and succeed.”