You don’t need to make your way through the more than 5,000 words of yesterday’s first installment of a New York Times series to get the gist of it. “The Empty Promise of Tax Incentives,” reads the headline on the front-page story. From there, reporter Louise Story leads readers through one tale after another of government-backed corporate welfare run amok. It’s a desperate race among various local and state government officials for jobs and economic growth, but the big winners are invariably the companies that play communities and states against each other, while draining public budgets of money needed for schools, roads, and other vital services.
General Motors extracted more than $200 million in incentives from Ypsilanti Township, Michigan, home to the auto factory where the iconic Rosie the Riveter and other women helped build bomber planes during World War II. But both of GM’s factories in the community now sit empty. The township has sued the company twice, the latest suit coming in 2010 when GM closed the second plant. The township is arguing, in part, that the company should close overseas plants before a domestic one like Ypsilanti’s in light of the massive bailout of the US auto industry that taxpayers are paying for.
The Times analyzed more than 150,000 awards and says state and local government incentives to businesses nationwide total more than $80 billion a year. The Times says the real figure is undoubtedly higher, but many of the government entities handing out incentives don’t know their full value. What’s more, the number of jobs created — the overwhelming rationale offered for granting incentives to businesses — is rarely tracked. When jobs are tracked, government officials concede that it’s impossible to know whether they would have been created without the perks.
“How can you even talk about rationalizing what you’re doing when you don’t even know what you’re doing?” Timothy Bartik, a senior economist at the W.E. Upjohn Institute for Employment Research in Kalamazoo, Michigan, tells the paper.
As CommonWealth reported earlier this year, Massachusetts is trying to get a handle on that question.
Yesterday’s story tees up the $75 million boondoggle investment that Rhode Island made in former Red Sox pitcher Curt Schilling’s video game company, which went belly up. That’s one story in which Massachusetts comes off looking good, as state leaders here balked at Schilling’s request for state aid and let him take his company across the border.
But the Bay State plays the expensive incentive game along with every other state. The Times series features a great online database that shows tax incentive information by state. The Massachusetts page shows that at least $2.26 billion in incentives are doled out here each year. That works out to $345 per capita and 7 cents of every dollar in the state budget.
Today’s installment looks at the wild west of incentive payments in Texas, where state government under Gov. Rick Perry hands out some $19 billion a year to private firms. The orgy of government incentives to business continues, the paper reports, even as cash-strapped Texas cut public education funding last year by $5.4 billion.
Coming attractions: A look tomorrow at the explosion in film tax credits.
–MICHAEL JONAS
BEACON HILL
House Minority Leader Brad Jones talked with Keller@Large about in-state tuition for immigrants, the state’s economy and the impact of the shrinking GOP to affect the legislative agenda.
Two medical marijuana clinics prepare to open in Framingham and Cambridge.
CommonWealth’s Paul McMorrow reports on former treasurer Tim Cahill’s testimony in his trial for allegedly using Lottery advertising to promote his run for governor.
Gov. Deval Patrick’s political future, if he doesn’t end up in Washington before 2014, depends on what happens in the next two years, argues The Berkshire Eagle.
MUNICIPAL MATTERS
The Urban Initiative at the University of Massachusetts Dartmouth has launched a website with a variety of data from education to public safety in New Bedford and Fall River to monitor the health of the South Coast’s two Gateway Cities.
NATIONAL POLITICS/WASHINGTON
Washington Republicans grumble that President Obama doesn’t fold at the negotiating table like he used to.
New York magazine argues that Grover Norquist’s real sway isn’t over Congress — it’s over the media he spent two decades courting.
Democrats shouldn’t be too mad at Citizens United, since they’ve exploited the Supreme Court ruling to a greater degree than Republicans have, the Atlantic argues.
ELECTION
Herald columnist Kimberly Atkins argues that, since the GOP lovefest surrounding Sen. John Kerry is really about returning Scott Brown to Capitol Hill, Bay State Democrats need to rally around a fresh face. “The party needs a candidate who can capitalize on gains it made in the last election and get voters to the polls,” she writes. “And with all due respect to the current and former members of the Bay State congressional delegation, that person’s last name isn’t Capuano or Lynch or Markey or Meehan.”
New Yorker editor David Remnick attends a conference in Washington and comes away concluding Hillary Clinton is running for president.
BUSINESS/ECONOMY
WBUR launches Generation Stuck, a series written by underemployed young people.
A new study of the 25 largest metropolitan areas, including Boston, shows cost hikes in basic needs, including housing and transportation, outpaced incomes in the last decade, making it a constant struggle for middle-class earners to gain ground.
The MetroWest Daily News calls for ending the online sales tax loophole.
The shrimp season in Maine may get shrunk.
New Zealand offered about $80 million in subsidies and marketing to prevent Peter Jackson’s The Hobbit from shooting elsewhere, the Wall Street Journal reports.
Completed foreclosures drop for the month, but new petitions to foreclose rise.
The Wall Street Journal spotlights eBay’s move into same-day delivery for online purchases.
EDUCATION
More than 5,000 additional students in Lawrence and Fall River will have longer school days thanks to a new initiative in five states that is being announced today by federal and state officials.
The Eagle-Tribune is charging that a secret meeting between Methuen school officials and several city councilors was a violation of the state’s Open Meeting Law.
A Massachusetts Budget and Policy Center study finds that unemployment among teenagers is up but dropout rates are down.
HEALTH CARE
Boston University researchers publish new findings that add to the mounting evidence of Alzheimer’s-like brain damage caused by traumatic head injuries suffered by football players.
ENERGY/ENVIRONMENT
Gov. Deval Patrick gets a first-hand look at a recycling program launched by a Beverly couple, the Salem News reports.
Time reports on the hard-sell of climate change.
CRIMINAL JUSTICE
Brockton police arrested a West Bridgewater man who they believe is the arsonist who set a dumpster on fire at least 13 times in the last five months, though police don’t know why he targeted the same dumpster.
A Globe editorial praises the work done so far by former prosecutor David Meier, who was tapped by the Patrick administration to sort out the mess made of criminal convictions that relied on drug tests performed by state chemist Annie Dookhan.
MEDIA
The Beat the Press panel wonders if the media has been too complacent in trying to get access to Boston Mayor Thomas Menino during his current hospital confinement.
Joe Kennedy III gets married over the weekend in California, NECN reports.
News Corp. shuts down its iPad-only newspaper, The Daily.
Bill Keller, in the New York Times, worries that the media’s retreat from foreign coverage may be hastened by the immense security issues facing correspondents working abroad.
The Times offers its fourth round of buyouts in five years.