No bribes for Amazon
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Amazon released its not-very-short shortlist of 20 cities where it will consider building its second headquarters. It’s hardly a selective roster; it includes just about every major metropolis east of the Mississippi, plus Denver, Los Angeles, and two cities in Texas.
Boston made the first cut, of course; that was hardly in doubt. And already the arguments are being made that Amazon must be seduced with publicly-funded giveaways, subsidies, and tax breaks if that’s what it takes to convince the company to set up shop here. Here’s my Boston Globe colleague Shirley Leung, writing Friday on Page 1:
Amazon has made clear from the get-go it wants to be wooed with tax breaks and other giveaways. That explains this over-the-top public process to find a second corporate home that will set up an intense bidding war. Massachusetts will be competing against multibillion-dollar incentive packages, and we’ll need to find a way to stay in the game without giving away the store. The city of Newark alone is offering $2 billion in tax breaks to Amazon, while Chris Christie, in one of his last acts as governor of New Jersey, pushed through a $5 billion package. That’s $7 billion, and yes, Newark made the cut.
Maryland joined the giveaway fray shortly after its Montgomery County was named a finalist; Governor Larry Hogan, according to various reports, plans to submit legislation to craft a $5 billion incentive package for Amazon.
Governor Baker should be taking notes. We’ll need a financial package that begins with a “b” — and you get there politically by proposing massive infrastructure and transportation improvements that benefit not just future Amazonians but everyone.
I strongly disagree.
Over and over again, Massachusetts — like other states — has gambled with public funds to bribe businesses to move into the state (or to keep companies already here from moving out). And over and over again, those gambles have failed. Officials justify the bribery by touting all the jobs that will be generated, or the leading-edge industries that will be established, or the tax bonanza the state will reap down the road. Yet in case after case — Intel, Evergreen Solar, Fidelity Investments, Organogenesis — the promised jobs either don’t appear or don’t last. Or the company doesn’t survive. Or the future tax windfall never arrives.
“Millions have been spent on tax breaks for businesses that promised to create jobs,” reported the Globe after a detailed investigation in 2010. “But in hundreds of cases, few or none resulted, yet companies kept the savings.” That story ought to be re-read by anyone tempted to join the “Billions for Amazon!” cheering squad. A sample:
Over the past 16 years, Massachusetts has given away hundreds of millions of dollars in state and local tax breaks for more than 1,300 development projects under its Economic Development Incentive Program, which aims to encourage companies to invest here and create jobs. Often the incentives work and new jobs result. But far too often taxpayers have not come close to getting their money’s worth, a Globe review has found.
Hundreds of the projects delivered fewer jobs than promised, and some companies actually slashed employment. Many firms won subsidies for projects they were set to build without state assistance; in some cases, incentives that were approved long after the projects were underway or complete. And many got generous packages though they agreed to create only a handful of low-paying jobs.
But you don’t need to go back to 2010 to be reminded that betting taxpayer dollars in order to attract a major corporation can quickly lead to morning-after regrets.
In 2016, state and city officials, led by Massachusetts Governor Charlie Baker and Boston Mayor Marty Walsh, cock-a-doodle-dooed with pride when General Electric agreed to move its corporate headquarters from Fairfield, Conn. to Boston. The deal was sealed with $150 million in tax breaks, financial incentives, and real-estate handovers — all of it public money to be spent for the benefit of a private company, and for the glory of the politicians who basked in the spotlight when the deal was signed.
Just two years later, General Electric looks much less attractive than it did.
The company is in serious trouble. Its market valuation, at one point more than $400 billion, has plunged to $140 billion. Its share price has fallen by half over the past 18 months. It was the worst performing company among the 30 Dow Jones Industrials last year. Indeed, General Electric is the Dow’s biggest loser since 2001.
“The company has been disgraced,” wrote Scott Davis, the CEO and lead analyst at Melius Research, in a report last fall. “GE is in crisis mode and needs to clean house as fast as possible.”
It has been trying to do so. In recent months, former GE Chairman Jeff Immelt was pushed into leaving. Other top officers quickly followed. The company grounded its fleet of corporate jets and eliminated company cars for senior executives. In November, for only the second time since the Great Depression, GE cut its dividend. Much of the great GE empire — NBC, GE Capital, the appliance business — has been sold off. The company’s locomotive division, one of its oldest, appears headed for sale. The 800 new high-powered jobs that GE pledged to bring to Boston are no longer a sure thing. Neither is the construction of a major new 12-story headquarters building along South Boston’s Fort Point channel.
“Perhaps lost in the hoopla of bringing GE to town is that big companies can have big problems,” Leung wrote last week. They certainly can, which is why the public shouldn’t be bled to pay for the hoopla. Taxpayers shouldn’t have been tapped for GE, they shouldn’t be tapped for Hollywood film studios, they shouldn’t have been tapped for Vertex or other biotech companies, and they shouldn’t be tapped for Amazon.
If one of the world’s richest businesses wants to carve out a new corporate headquarters in Massachusetts or anywhere else, it should do so on the same terms and under the same restrictions as any other company. It should not be pitting state against state in a brazen bidding war to see who can come up with the most lucrative bribes.
My argument isn’t against cutting taxes, unsnarling red tape, and improving infrastructure in order to lure corporations to Boston and Massachusetts (or to any other city and state). My argument is that if tax rates are too high, they should be cut for every business. If regulations are too convoluted, they should be streamlined for every employer. If public facilities are sub-par, they should be improved for every user.
If Massachusetts can’t attract Amazon without crafting a package stuffed with what amount to kickbacks and rewards, it should drop out of the competition. New Jersey’s $7 billion in tax breaks is insane. If New Jersey voters are willing to shell out that kind of dough to entice Amazon to Newark, then they’re insane too. A “financial package that begins with a ‘b’” is the last thing Governor Baker or the Legislature should consider. Instead they should learn a lesson from the GE experience, and say no to corporate welfare once and for all.
It’s been a year
Arguable turns 1 this week. That’s a milestone I couldn’t have imagined reaching when the newsletter was launched last year. To be honest, I had misgivings about the whole project. When that first issue went out on January 23, 2017, it had a grand total of 488 subscribers. I wasn’t persuaded that there would ever be many more. For anyone interested in my views, after all, I was already writing two Boston Globe columns each week, and venting occasional opinions on Twitter and Facebook. Wasn’t that enough?
Not according to Linda Pizzuti Henry and Ellen Clegg, respectively the Globe’s managing director and editorial page editor. They’re the ones who urged me to start Arguable, confident that if I tried my hand at writing for another format, an e-mail newsletter less constraining than a newspaper column, readers would follow. They were right. Arguable now has nearly 60,000 subscribers, and the number climbs every week. (Cue Sally Fields clip.)
Given the state of American life these days, it’s inevitable that much of what I write about in Arguable is political. But while I follow politics pretty closely, I am decidedly not a political junkie. I was urged from the outset to write about whatever might appeal to me, and wallowing in politics is often the least appealing thing I can imagine.
So I’ve used Arguable to write about other things. Among them: the indispensability of the serial comma. Using sex to advertise hamburgers. Some business cards I found as I was packing for a move. My failed efforts to master foreign languages. The Arguable post that drew the most reaction — all of it positive, which is definitely not the norm — was “Herman and me,” a piece I wrote in May about how my life had been shaped by the renowned American author Herman Wouk, who had just turned 102. I got almost as much response to a piece in September defending Chief Wahoo, the unfairly-maligned emblem of the Cleveland Indians.
A confession: I hate writing (though I like having written). Unlike some wordslingers who can tear off a 1,000-word essay without breaking a sweat, I’ve never found writing quick or easy. Even after 30 years in opinion journalism, I find few things more anxiety-provoking than a blank page and a looming deadline. As a writer, I am very much of the Red Smith school: When the late, legendary New York Times sports columnist was asked how he wrote his essays, he answered, “I sit down at the typewriter, open a vein, and squeeze it out one drop at a time.” That’s me.
But I’ll keep squeezing if you’ll keep reading.
I’m grateful to you for subscribing to this newsletter. Invite your friends to sign up for Arguable, and I’ll be even more grateful. It takes only a moment to subscribe — just click on http://bitly.com/Arguable.
Happy first anniversary. Onward to Year No. 2!
The pro-immigration consensus
Washington once again is snarled by a government shutdown brought on by a partisan clash over immigration policy.
Of course the government hasn’t really shut down. The Coast Guard is still on patrol, Social Security checks are still being cut, federal courts are still hearing cases, TSA screeners are still conducting security theater at US airports. Tens of thousands of “nonessential” government employees may be told not to report to work for a day or two, but everyone knows they’ll eventually be paid anyway. The whole thing is a farce, the skirmishing intended merely to score temporary political points.
Nevertheless, the cause of the showdown, at least on the surface, is a dispute over what to do about the 700,000 so-called “Dreamers” — immigrants who were brought illegally to the country as children. Does this mean that Republicans and Democrats have utterly irreconcilable views about immigration? No, actually. And thereby hangs a paradox.
Donald Trump’s presidential campaign caught fire because of his harsh rhetoric about immigration — Mexican rapists, build the wall, “total and complete shutdown” of Muslims, etc. That was the sentiment that propelled him to the front rank of Republican primary contestants, paving the way for his eventual nomination and election.
Anti-immigrant sentiment is nothing new in America. A nation of immigrants we may be, but over the course of American history there have been repeated surges of animus against immigration. The targets have changed. The 19th-century panic over Catholic immigrants has given way to the 21st-century resistance to Muslims, for example. Contemporary resentment of Mexicans has taken the place of an earlier age’s exclusion of Chinese. Still, the language used by immigration restrictionists then and now is much the same. So are the fears of demographic collapse, the dilution of America’s racial makeup, and the conviction that immigrants are prone to crime and radicalization.
Yet something has changed. In the past, anti-immigration fervor was strong enough to drive sweeping changes in US law, such as the Chinese Exclusion Act of 1882 and the harsh Johnson-Reed Act of 1924, which severely restricted immigration from Eastern and Southern Europe. But today, extreme though the restrictionists sometimes sound, they represent only a minority opinion. Even with the changes in attitude over the past 20 years, especially on the right, there is no anti-immigration consensus in America. There isn’t even an anti-illegal-immigration consensus. Polls consistently show that a solid majority of Americans — including most Trump supporters — want illegal immigrants working in the US to be legalized, not deported.
On Friday, the Pew Research Center released its latest survey data on two issues at the heart of the current debate: legal status for Dreamers and an expanded wall along the US-Mexican border. Overall, Americans are firmly in favor of providing permanent legal status to the young undocumented immigrants (74% for, 21% against), and solidly opposed to an enlarged border wall (37% for, 60% against). To be sure, support for an enlarged border wall runs high among Republicans. But on the fate of undocumented immigrants brought to America as children, even voters who identify as Republicans are more inclined to support legal status.
Other surveys confirm that the pro-immigrant consensus has gotten stronger, not weaker. Should immigration to America be reduced? In the mid-1990s, according to Gallup, fully two-thirds of the public wanted to curtail the number of immigrants allowed to enter the country. Today, only 35% of voters feel that way. Asked whether immigration is, on the whole, “a good thing or bad thing,” majorities of 70% of more today say it’s a good thing — the highest positive responses recorded in at least 15 years.
You wouldn’t know it from the news coverage or the slanging matches on social media, but the rise of Donald Trump has not corresponded with a rise in American hostility to newcomers from other lands. Even Trump has urged Congress to pass a bipartisan “bill of love” and lift the cloud of illegality from youthful Dreamers. Nativists and xenophobes represent only a small minority of public opinion. The battles over immigration rage, but most Americans want the gates kept open.
Julius Lester, RIP
An American original died last week. Julius Lester was a prolific author, a photographer, and a musician, a volunteer with the Student Nonviolent Coordinating Committee during the Civil Rights movement, and for 30 years a professor at the University of Massachusetts Amherst — first in the department of Afro-American Studies, later in the faculty of Judaic and Near Eastern studies.
More than once, Lester found himself at the center of bitter controversies. In the first sentence of its obituary The New York Times called him “a captivating and often polarizing American writer whose odyssey through a labyrinth of religious and ethnic identities caused him to be labeled a militant black separatist and a race traitor, as well as an anti-Semite and, after his conversion to Judaism, a vociferous Zionist.” In reality, he was a man of passion and erudition and integrity, whose refusal to keep silent when confronted with falsity earned him bitter detractors and ardent admirers across the political and racial spectrum.
Lester was the author of dozens of books, including novels for children and adults. His very first book, written with Pete Seeger in 1965, was a musical manual, “The Folksinger’s Guide to the 12-String Guitar as Played by Leadbelly.” His first book about race became a bestseller. “Look Out Whitey! Black Power’s Gon’ Get Your Mama!” was an inflammatory tract that celebrated black separatism. But that was where the arc of Lester’s career began, not where it ended.
He was the son of a Methodist minister, who taught him from an early age to resent and resist the bitterness of Jim Crow racism. “Though we were powerless to change segregation,” Lester wrote of his father’s influence in his 1988 memoir, “Lovesong,” “we would not freely choose it. His anger was self-respect, and we took pride in knowing that Lesters did not use Colored toilets, drink from Colored fountains, walk through doorways with signs reading Colored Entrance, buy anything from a Colored Window — and at home, in Kansas City, Kansas, I walked to and from downtown rather than ride in the back of the bus.”
“Lovesong” is subtitled “Becoming a Jew.” It recounts Lester’s remarkable spiritual journey from the little boy in his father’s church whom everyone expected to one day become a pastor himself to the young adult, then grown man, who came to feel an undeniable tug toward Judaism. As a child, he was surprised to learn that he’d had a Jewish ancestor, a Jewish-German immigrant who settled in Arkansas and married a former slave. Over time, as Lester learns about Jewish history and the Jewish faith, the more the ancient religion attracts him — and the more it confuses him.
“I don’t know what to think . . . about how Judaism encourages one to question, to argue, to disagree, even with God,” Lester wrote in “Lovesong.” There had certainly been no arguing with God in his father’s church. “But Judaism, if I understand what I am reading, insists that the Jew has the sacred responsibility to make a personal relationship to God and true relationships involve disagreements, arguments, and even estrangements.”
In 1981, Lester converted to Judaism, taking the Jewish name Yaakov — Jacob. A few years later, leading his synagogue’s worshipers in prayer as the cantor, he has an epiphany.
“I know now. At long last I know what my voice was meant to sing. All those years I sang folk songs, spirituals, blues, work songs, and always knew that something was absent, that as much as I loved spirituals, I was not wholly present when I sang them. Now I know why. It is this music my voice was meant to sing. . . . I know now who I am.”
Julius Lester was 78. May his memory be a blessing.
In Sunday’s column, I wrote about a controversy heading to the Supreme Court: whether online merchants can be compelled to collect sales taxes for a state with which they have no physical connection. For decades, states have been prevented from conscripting out-of-state sellers to be tax collectors. In the 1970s, the so-called “Quill rule” protected local mail-order companies; today it protects local internet businesses. Is it time to scrap the Quill rule? Definitely not. The big online merchants — Wal-Mart, Amazon, Apple — already collect sales taxes, since they have a physical presence everywhere. But many small companies will be hurt if they are forced to start calculating, collecting, and remitting taxes to every state and city where a customer happens to live.
Last Wednesday, I contrasted Senator Elizabeth Warren’s before-and-after reaction to the GOP tax law. For weeks before the bill passed last month, she repeatedly and vociferously denounced it; yet since it went into effect, she has been silent. Warren had condemned the tax overhaul as a “heist” and a “scam,” and said it would be terrible for working families. But ever since the measure was signed, hundreds of US companies with millions of employees have announced bonuses, raises, and expanded benefits for their workers. How strange that Warren has kept mum in the face of all this good news.
Wild Wild Web
When the pope flew, love was in the air.
Flashback 2017: Bad Lip Reading went to the Trump inauguration, and the results were hilarious.
Think you can’t draw? Check this out.
The last line
“‘She is the Surprise,’ said Stephen, and he whispered, ‘The joyful Surprise, God and Mary be with her.’ ” — Patrick O’Brian, “The Far Side of the World” (1984)