George Mason University Researchers Say Deal With Foxconn Could Reduce Economic Activity

A new study on government subsidies by George Mason University found Wisconsin’s deal with Foxconn will not work and could reduce economic activity in southeastern Wisconsin.

Researchers with the Virginia-based Mercatus Center at the university focused on the Foxconn deal because of its size and high profile.

In its study, "The Economics of a Targeted Economic Development Subsidy," George Mason researchers found targeted subsidies are more likely to diminish rather than enhance the economic prosperity of communities that offer them.   

Researchers based their study on $3.6 billion in state incentives — taking into account the $3 billion incentives package approved by the GOP-controlled state Legislature in 2017, and an additional $600 million in utility, road, training programs and economic development programs needed for the project...

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Ken Notes: Ouch. A lot has already been invested so lets not scare them away. Also much of the state investment is contingent on job creation.

I will restate my request for a new tax incentive for ALL growing companies large or small based on new employees earning over a certain amount. For Example, 2K tax credit for ten years for new employees making over 50K in salary and benefits. The credits goes away if the total employee count falls below the new number. If you need the money up front convince a bank you will maintain the new employee level. I also suggest we rewrite TIF laws to add that a specific project could receive a 10% incentive for brick and mortar growth with a signed development agreement guaranteeing value. We do this now by manipulating the "rules" now so why not create a statute to clear this up.

Putting a majority of our dollars in one basket (Foxconn) sent a message to many companies that adding one or two employees in Wisconsin does not matter when in fact we still have more people employed by small companies that large ones.