Don’t get me wrong — I love non-partisan fact checking sites like PolitiFact and FactCheck (even when I don’t entirely agree with their findings). But PolitiFact hit one of my hot buttons the other day when they perpetuated what I think is one of the biggest propaganda bamboozles of modern times.
The story that hit my hot button was PolitiFact checking a statement made by Donna Brazile, saying that the governor of Wisconsin had “proposed tax giveaways to corporations”. They found that governor Walker had not just proposed tax cuts for corporations, but had already signed bills that actually cut taxes for corporations. For example,
Walker signed a law on Jan. 31 that says that companies that relocate to Wisconsin will not have to pay corporate taxes for two years.
In other words, if anything her statement was conservative and truthful. And yet, they didn’t rate her statement as fully “True”. Why?
It’s debatable whether these could fairly be considered “giveaways,” since they are intended to reward companies for creating jobs.
Ever since the days of “trickle down” (“voodoo”) economics, I’m suspicious of politicians who use the jobs excuse as the reason for the most outrageous boondoggles, but this example is particularly annoying to me.
Relocating a company from one place to another does not “create” jobs — at best it simply rearranges them. And at worst, it weakens the local tax base, causing reduced funding for libraries, roads, job training, and other programs, resulting in an area that is less likely to create new small local businesses. And it is small businesses that create the majority of jobs (even PolitiFact agrees with that).
And yet, state and local governments are falling all over each other to hand out huge tax breaks for corporations in the name of jobs. If that isn’t a giveaway, I don’t know what is.
You can’t blame corporations for going after these big tax breaks. Walmart alone has received more than a billion dollars from cash strapped local governments, including “free or reduced-price land, infrastructure assistance, tax increment financing (TIF), property tax abatements or discounts, state corporate income tax credits, sales tax rebates, enterprise zone tax breaks, job training funds and low-interest tax-exempt loans”. What makes this worse is that these subsidies are not actually necessary. A study in 2004 found that even in cases where Wal-mart had sought subsidies and didn’t receive them, they still built new stores.
So local governments give tax breaks to corporations that are not even necessary, using the excuse that they create jobs, which they don’t. Again, if that isn’t a giveaway, I don’t know what is. And then the politicians claim they have to cut back teacher salaries and other programs that actually do help our economy. I can’t understand why people put up with this crap.