The picture across the business section of the Dec. 11 Post and Courier said it all. There were Gov. Mark Sanford, North Charleston Mayor Keith Summey, and DaimlerChrysler executive Rolf Bartke in the kind of grip-and-grin that politicians and newspaper photographers love.
And what, besides reindeer and Christmas cheer, could have made these three wise guys so merry? Only one thing: a new multimillion dollar van assembly plant in North Charleston and the promise of jobs, jobs, jobs. Oh, yes, and more jobs.
It seems Herr Bartke’s company will convert the old America LaFrance truck plant to assemble their Dodge Sprinter van. In the first of three phases of development, DaimlerChrysler will commit $40 million and create 220 jobs. If the second and third phases are implemented — and there is no guarantee they will be — there would be an additional $400 million investment and up to 1,800 new jobs.
Now flash back one week further, to the December 4 front page of the P&C. In a good piece of reporting by Tony Bartelme and Yvonne Wenger, we learn that 113,000 new homes are in the pipeline for the tri-county area. That’s 269,000 new residents, 209,000 more vehicles on local roads, 44,000 students in local schools, 188 million gallons more water used each week, and 8.3 million pounds more trash created each week.
Who’s going to pay for all these new roads, new schools, expanded services? It won’t be DaimlerChrysler, that’s for sure.
Along with dirt cheap labor and lax environmental regulations, the deal that lured the automaker to North Charleston inevitably included tax credits. How much money did the state and county agree to “credit” DaimlerChrysler? Two and a half million dollars for Phase One. Beyond that, no one has yet totted up the numbers, but it will likely be nine figures.
In his new book, The Great American Job Scam: Corporate Tax Dodging and the Myth of Job Creation, Greg LeRoy paints the Palmetto State as a poster child for corporate recruiting run amok.
“Instead of good jobs, workers are getting low wages and taxpayers are getting poor public services,” LeRoy writes. “The South Carolina Department of Commerce brags, on its website, that the state has the lowest rate of unionization and that its manufacturing wages are almost 10 percent below the national average. But as jobs and population grow, public systems get strained and services suffer. With overcrowded roads, South Carolina has the nation’s sixth highest rate of auto fatalities. With poorly funded public healthcare systems, its infants are the sixth most likely to die. With low school funding, its children fare poorly on SAT scores: lowest among the states in verbal and second lowest in math.”
The fact is, LeRoy writes, ” …job subsidies have become pure and simple transfers of wealth to corporate shareholders — from the rest of us.”
And when a footloose company is lured into the state with gobs of public money, what makes you think they will stay? They have already shown they have no loyalty to their employees or communities. What would stop them from running off with the next politician who dangles a bundle of tax credits, free land, job training, and other goodies in front of them?
LeRoy cites the example of Bendix, the auto parts maker, which fled South Bend, Ind., and the United Auto Workers Union in 1982, to come to Sumter. But in 2004, the company laid off 400 workers and left town for Mexico.
When politicians give away our tax base, even as they lure more people into the area with “new jobs,” that means the rest of us must pay ever higher taxes to expand and maintain public services and infrastructure. And as we are learning, people will pay only so much. South Carolina is now engaged in a massive tax revolt that threatens our very way of life.
There are literally thousands of examples of corporations fleecing the public through job subsidies. So why are they allowed to continue? The picture of the three wise guys in the Post and Courier says it all. You have an automaker who just got his hands on a big piece of public pie; you have two politicians who can brag they just landed a bunch of new jobs for the folks back home. No wonder everybody is smiling.
Of course, a few people will do very well on the DaimlerChrysler deal — realtors, developers, financial service providers. In other words, the very people who control policy and politicians in this state, who control much of the media, who control the public image this state likes to project.
No wonder we keep giving away the farm to woo these corporate floozies. And if the public doesn’t wake up to this massive scam, we may all land in the poorhouse. Love Best of Charleston? Help the Charleston City Paper keep Best of Charleston going every year with a donation. Or sign up to become a member of the Charleston City Paper club.