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Michigan spent $1.8B and only created 602 jobs

Michigan spent $1.8B and only created 602 jobs

littlexsparkee

Comments (74)

  • tancop
    selectively giving away free money to big business is straight corruption. there is no other way to put it. everyone involved should lose re election and get investigated by the financial crimes unit.but i dont think "leave it up to the market" is a better idea. investments like this just need to be transparent, open to everyone and set up strict punishment for stealing the money with prison for executives.if they wanted to actually create jobs they would support small companies and set up open competitive programs based on project quality. or start a state investment bank giving super low interest loans so factories can expand without cutting profitable divisions like in china.
  • ryandrake
    > A new report suggests the state of Michigan is the latest to learn that lesson the hard way.There doesn’t seem to be any lesson-learning happening, since governments keep trying this despite the outcome always being the same.
  • altcognito
  • rmason
    I am a lifelong resident of Michigan and sadly the state keeps doubling down on what isn't working. Politicians like to think they're smart enough to pick winners and they're horrible at it.When Governor Jennifer Granholm was governor a guy approached the state needed investment for a factory in Flint. It would create thousands of jobs. They were delighted because that is something that never happens in Flint. They not only gave him the money but he posed him holding a $9.1 million dollar check with the governor. The picture of the two of them together was in all state media. You know when something sounds too good to be true you might want to do a little checking? When people in Flint saw the picture they informed the state that this guy was a well known conman who had just got out of jail and was living in a trailer. Luckily they were able to recover the money.https://www.mackinac.org/12345Another Gov. Granholm story was the time an old line Boston VC firm approached the state for investment. So the state pulled funds out of the employees retirement plan to invest in the next round. The idea was that this would give the state more venture investment. But again no one did any due diligence whatsoever. This firm was not obligated to open an office in the state but only come a couple of times a year looking for investments. They were under no obligation to make any investments in the state and in fact did not. Due diligence would have revealed that the firm offered a very low return on their last several funds. So in the end the employees retirement funds grew more slowly and the state got no venture investments. That venture firm wasn't able to raise another fund and closed.
  • mediumsmart
    Did the 602 each hire someone to do their job for 12k a month until 2037 because sharing is caring?
  • NoahZuniga
    > Hohman examined eight major projects—"those that offered $100 million in payments and received significant media attention"—totaling $2.7 billion in promised incentives> All told, the governor said that her major subsidy projects would create 20,595 jobs in MichiganEven using these numbers that works out to $135k/job, which is bonkers!
  • JumpCrisscross
    This looks like Michigan transferred actual cash. Not tax abatements on new projects.
  • jszymborski
    I wonder if there would be merit to requiring that government investment must come with shares in the company at market rate. Because short of that it feels like a misappropriation of funds.
  • saddat
    It works in China as there absolute experts Work in government , whereas in Europe government employees are typically not competitive in free market
  • jmclnx
    That works out to 2.5 million per job.This is not the first time this type of thing happened almost looks like a laundering scam. Companies that do this should face real and very expensive consequences. But we know that will never happen.
  • northisup
    did they, like, not lose a million jobs tho?
  • geophph
    “Click to continue reading”No thanks
  • tlogan
    Michigan has relatively business-unfriendly laws and regulations.Apparently their tax system is quite favorable to businesses, but taxes are only one (small) part of the equation. The taxes matter more once a company is making a lot of money.In short, tax incentives and random per company “investments” (bribes?) are not enough to offset certain laws and regulations Michigan has.I am not saying those laws and regulations are bad. I am just saying that targeted tax incentives and investment for specific companies are the wrong way to solve the problem.
  • redwood
    Two things 1) we dont know if the state might have lost more jobs if these incentives weren't provided 2) the deeper issue is that the auto makers compete with state backed companies in other regionsI'm not saying we need to copy state backed but the climate is desperate
  • freeone3000
    The money spent on site and land clearing results in a big empty field? Yes, yes it did, that’s what those words mean. If we’re going to bribe companies to do a thing, we should at least accept when they did do it.
  • shusaku
    What the hell is that image of Whitner.
  • diogenescynic
    Democrats are structurally incompetent. I've never seen them use tax dollars in a fiscally responsible way. I was always a registered democrat, but their complete incompetence and lack of efficiency has really turned me away from them. I don't trust them to spend money effectively or wisely. In California we are taxed extensively but then spend hundreds of billions on trains that don't exist, homeless programs that clearly do nothing but make the problem worse, our roads are in shambles, and quality of life crimes are all but completely ignored. Every state where democrats are in majority seems to be poorly managed.
  • anon
    undefined
  • pcarolan
    [flagged]
  • kortilla
    Claiming the state “spent” money when it’s something like a tax incentive is completely disingenuous bullshit. This article does this in spades to come up with this huge billion dollar figure.“We won’t collect additional property taxes on this new thing you’re building for 10 years” is not the same thing as spending money. If a business doesn’t start there instead you don’t get any money at all. So in both scenarios you get no tax revenue but without the business you hurt your own economy.It’s not taxpayer money being sent away. It’s tax collection policy and if we claim tax exemptions are spending money, then the government is also spending billions on non-profits and low income households.