Whose level playing field?
The cost of the state and local incentives deal bringing Google to Lenoir could reach $260 million, The News & Observer reports today.
As I've written before, this will be a huge boost for the Caldwell County town that lies just down the mountain from Boone and Blowing Rock on U.S. 321. Google says it will invest $600 million and employ 210 people earning average salaries of $48,000.
Of course, with Google winning tax exemptions for 30 years, the $600 million investment provides limited benefits. The jobs are the important component. Even better, this puts Lenoir on the map for other companies looking for a nice place to do business.
But that raises another issue. Google, which really strong-armed this deal, defends its tough bargaining by comparing North Carolina to other states.
"In the case of this project, the vast majority of the incentives are taxes we would not pay in other states," Google spokesman Barry Schnitt wrote in an e-mail message in response to The News & Observer. "They level the playing field."
Wait a minute. This points to a heck of a problem. If we have to lay out these kinds of incentives to "level the playing field" for Google, what kind of playing field are other North Carolina businesses trying to compete on? I know we're a high-tax state, especially for the Southeast, but are we that far out of line? If we are, we're putting ourselves at a big disadvantage.
I don't really believe Google wants a level playing field. It wants to be king of the hill. At the same time, we need to be fair to all the other businesses that are employing people -- and paying taxes -- in this state. They're the ones that deserve a level playing field.
Comments (6)
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Middle-income workers pick up the slack for this kind of legal tax evasion by big businesses, or it is passed on to succeeding generations as debt on bonds to pay for things we don't have the tax revenue to pay for now. The leveling you are seeing is that of a gunsight aimed at the middle class. Ka-blooey!
Posted on February 8, 2007 11:28 PM
The middle class benefits if we can keep our economy healthy, so jobs like those provided by Google and HondaJet are important. If high tax rates make our economy less competitive, maybe we should adjust them and grow more business here, which actually could produce more tax revenue in the long run.
Posted on February 9, 2007 8:30 AM
More businesses (getting tax incentives that forgive property taxes for years) exporting jets, etc., create more tax revenue by employing people who pay local sales and property tax, right? These newly employed people, I assume, must be transplants? If they are merely switching from other jobs already here, then the taxes they will be paying are the ones they are already paying. Net increases in tax base, negligible. If they ARE transplants, are they mostly going to be living in High Point or Greensboro? Or will they end up out in the counties, to escape higher taxes, will will only get higher and higher for citydwellers? And yet they will enjoy the city's amenities, I am sure. But pay for them? Hardly. I say, let Greensboro keep annexing. And charge higher use fees for county residents coming into toww. Heck, what about toll roads that charge according to address? Then, just watch in several years as Summerfield and Oak Ridge raise taxes.
More business! More pollution! More infrastructure (but not mass transit)! Who needs farms? Who needs local food? Who needs claen air? Who needs to pay for budget items now we can finance a more bonds due tomorrow?
Posted on February 9, 2007 2:50 PM
The wisest growth is not just about volume, Doug.
Posted on February 9, 2007 2:51 PM
North Carolina was the no. 1 in-migration state in 2006, according to a survey by one of the big moving companies. We're also graduating lots of people into the workforce from our high schools and colleges each year. All these people want jobs. More traffic, pollution, etc.? Yep. You couldn't build mass transit systems fast enough to keep up. For some reason, the systems we have aren't all that well utilized, anyway. I rode PART buses between HP and Gso one day this week along with a few other passengers and a lot of empty seats.
Posted on February 9, 2007 3:10 PM
The in-migration is heavily skewed, I am guessing, from retirees and Hispanic workers, both legal and illegally coming here for usually service-sector or farm labor or..yep, construction (gotta build those mini-mansions for the Yankee reitrees).
You didn't answer whether you might agree that many, many of the upper-income jobs created by some of these companies will be filled by people who are likely going to live in Northern Guilford County or Rockingham County, but less likely to be living in Greensboiro and even less in High Point. So, the taxes these jobs are generating won't be coming back to those cities in anything like the numbers needed to justify the increasingly exorbitant giveaways granted the companies.
Posted on February 10, 2007 11:04 AM