Tuesday, December 16, 2008

Red state handouts to foreign auto-makers

Some great reporting from The Washington Independent on just how much money Southern states have lavished on foreign auto companies while their U.S. Senators refuse to a loan to Detroit.


1 comment:

Lucid Idiocy said...

To be fair, a lot of those tax breaks are often based on a tax base that wouldn't exist without the auto plant.

That is, you build it and the local government allows you to take what you would have spent on property taxes and direct it to pay off the construction bonds instead. Often there's a annual step up in the amount of taxes the company pays, starting at 0 percent and working up to a pre-determined amount as high as 100 percent in 15-30 years.

It's not the same as writing a check, because it's revenue that wouldn't exist without the project.

Of course, we are pretty fond of spending tax dollars on roads, interstate interchanges, sewer and water to entice a plant. And the state gives out huge sales tax breaks across a range of industries.

At least, that's how we roll in Georgia.

Sen. Chambliss called. He said "Suck it, Detroit."