hvactec
VIP Member
How does being taxed to give money to the oil-rich kingdom of Abu Dhabi and its hereditary ruler strike you?
The cost, if you live in New York State, comes to about $1.4 billion, or roughly $190 per household, for an economic development deal with a privately held company called GlobalFoundries to build a microchip plant near Albany.
As you ponder this forced transfer from you to the chip-making giant, which is controlled by Abu Dhabis ruler Sheikh Khalifa bin Zayed Al Nahyan, keep in mind that Abu Dhabi says its citizens enjoy the worlds third-highest per capita income, a third higher than Americans.
The deal for the chip plant is being challenged in court by a long-time critic of corporate welfare in a case that will test New Yorks long-standing policy of subsidizing business.
At issue is the state constitutions Article VII, Section 8, which says, The money of the state shall not be given or loaned to or in aid of any private corporation or association, or private undertaking
Voters enacted this ban on gifts of cash and credit to corporations in 1846 after taxpayers got stuck with debts from giveaways to railroads, the high tech industry of that era.
To me, the constitutional language raises a question: How can New York State be forcing its citizens to make this gift and hundreds of other smaller corporate gifts all across New York?
The state, technology giant IBM, and GlobalFoundries have all asked New Yorks highest court to prevent that question being raised in a trial.
They want a ruling that upholds a lower judges dismissal of a lawsuit brought by Buffalo lawyer James Ostrowski, who is challenging the GlobalFoundries deal as unconstitutional.
LIBERTARIAN CRITIC
Ostrowski, a longtime libertarian critic of corporate subsidies, sees such gifts as a way that politically connected business leaders funnel taxpayer money to one another while avoiding the competitive market and making everyone else worse off, including those out of favor with the powers that be.
Advocates of state economic development grants, including GlobalFoundries spokesman Travis Bullard, say state financial support is vital to overcoming the high cost of doing business in the Empire State and creating new jobs.
The problem is that such gifts relieve pressure for actual reform and instead reinforce the system of taking from the many to benefit the few. The issue needs a full airing in court, which would expose tricks used to get around the constitution.
An Oct. 13 hearing in Albany focused on whether the case could be dismissed without a trial. A full airing at trial would resolve the gift issue and would also help people understand how much of their financial plight is due to market capitalism being supplanted by corporate socialism.
State and local governments forced residents nationwide to give corporations $70 billion last year in cash, tax favors and cheap credit, according to Professor Kenneth Thomas, a University of Missouri-St. Louis political scientist and author of Investment Incentives and the Global Competition for Capital.
That works out to about $600 per household. The $70 billion estimate does not include federal giveaways, which enjoy broad bipartisan support and on which the federal government provides, like state and local governments, only skimpy data.
read more David Cay Johnston
The cost, if you live in New York State, comes to about $1.4 billion, or roughly $190 per household, for an economic development deal with a privately held company called GlobalFoundries to build a microchip plant near Albany.
As you ponder this forced transfer from you to the chip-making giant, which is controlled by Abu Dhabis ruler Sheikh Khalifa bin Zayed Al Nahyan, keep in mind that Abu Dhabi says its citizens enjoy the worlds third-highest per capita income, a third higher than Americans.
The deal for the chip plant is being challenged in court by a long-time critic of corporate welfare in a case that will test New Yorks long-standing policy of subsidizing business.
At issue is the state constitutions Article VII, Section 8, which says, The money of the state shall not be given or loaned to or in aid of any private corporation or association, or private undertaking
Voters enacted this ban on gifts of cash and credit to corporations in 1846 after taxpayers got stuck with debts from giveaways to railroads, the high tech industry of that era.
To me, the constitutional language raises a question: How can New York State be forcing its citizens to make this gift and hundreds of other smaller corporate gifts all across New York?
The state, technology giant IBM, and GlobalFoundries have all asked New Yorks highest court to prevent that question being raised in a trial.
They want a ruling that upholds a lower judges dismissal of a lawsuit brought by Buffalo lawyer James Ostrowski, who is challenging the GlobalFoundries deal as unconstitutional.
LIBERTARIAN CRITIC
Ostrowski, a longtime libertarian critic of corporate subsidies, sees such gifts as a way that politically connected business leaders funnel taxpayer money to one another while avoiding the competitive market and making everyone else worse off, including those out of favor with the powers that be.
Advocates of state economic development grants, including GlobalFoundries spokesman Travis Bullard, say state financial support is vital to overcoming the high cost of doing business in the Empire State and creating new jobs.
The problem is that such gifts relieve pressure for actual reform and instead reinforce the system of taking from the many to benefit the few. The issue needs a full airing in court, which would expose tricks used to get around the constitution.
An Oct. 13 hearing in Albany focused on whether the case could be dismissed without a trial. A full airing at trial would resolve the gift issue and would also help people understand how much of their financial plight is due to market capitalism being supplanted by corporate socialism.
State and local governments forced residents nationwide to give corporations $70 billion last year in cash, tax favors and cheap credit, according to Professor Kenneth Thomas, a University of Missouri-St. Louis political scientist and author of Investment Incentives and the Global Competition for Capital.
That works out to about $600 per household. The $70 billion estimate does not include federal giveaways, which enjoy broad bipartisan support and on which the federal government provides, like state and local governments, only skimpy data.
read more David Cay Johnston
