DAILY WISCONSIN

Foxconn

Predictably, Trump Comes Up Empty on Foxconn

From The White House’s official transcript:

This is just the beginning.  This is one of the largest plants in the world.  And when you think in terms of 20 million feet — if you build in Manhattan a million-foot building, that’s a very big building.  They don’t get much bigger.  And here you’re talking about more.  Think of it: more than 20 million feet.  And that’s probably going to be a minimal number.

So I’m thrilled to be here in the Badger State with the hardworking men and women of Foxconn working with you.  Moments ago, we broke ground on a plant that will provide jobs for much more than 13,000 Wisconsin workers.  (Applause.)  Really something.  Really something.  Thank you, fellas.

‘Every paragraph revealed another strange twist or failure’

As it turns out, history had already determined that state handouts to attract and keep businesses was a horrible idea, so bad in fact many states amended their Constitutions to prevent those mistakes from ever happening again in the future.

After reading the Cap Times article “Where to now with Foxconn? It won’t leave Wisconsin, but it won’t build what it promised,” where every paragraph revealed another strange twist or failure, I had to look up why Scott Walker and his band of plundering Republicans pirates liked the idea of state corporate handouts so much. Not surprisingly, their actions weren’t based on anything I found in the real world, it was simply pure ideological theory. Look at how much money we’re losing, and how few jobs they’re creating…

Via DemoCurmudgeon: History, Corporate Tax Incentives, and the State Constitutional Gift Clause collide with Scott Walker’s economic theories.

Walker Foxconn Folly

They say there’s no such thing as bad publicity.

Here’s the counter-argument today, first in a long, must-read piece carried by the Madison Capital Times which, among other things, looks at the risks facing Racine County and the Village of Mount Pleasant where Foxconn bulldozing and local borrowing are well underway:

Based on an examination of Foxconn’s corporate history, Asian business practices and the stark realities of the LCD panel production industry, the likelihood of a flat panel factory in Mount Pleasant seems unlikely any time soon — if ever.

Neither does the prospect of anything close to 13,000 “family supporting” jobs…

For Racine County, the situation is more pressing… The total county cost was recently projected at $911 million, a liability of more than $10,000 per county household…

Via The Political Environment: Grim new reviews for Walker Foxconn folly billed to taxpayers

Shrinking in reality

Just to remind you on how much of a COMPLETE SUCKER you have to,be to think that Foxconn will ever create anything close to 13,000 jobs, let me show you yesterday’s John Oliver segment on the automation of jobs. Something Foxconn proudly proclaims to be a “world leader” on.

As Oliver’s piece notes, historically jobs that have been automated out of existence get replaced by new technologies, generally in more knowledge-based industries. Except that Foxconn’s big pre-election promises on new “innovation centers” outside of Racine County don’t seem to be working out either.

Via Jake’s Wisconsin Funhouse: Foxconn keeps talking big, but keeps shrinking in reality

Really Bad Scam

Jon Peacock of the Wisconsin Budget Project on what we need to look at with the Foxconn contract,

Defenders of the Foxconn deal often claim that the contract protects state taxpayers because Foxconn won’t receive any credits if it doesn’t meet job thresholds. Although that claim is true in part, it’s also very misleading. More than a third of the planned subsidies — $1.6 billion — including the state and local infrastructure spending for the project, has little or no tie to job creation.

3. The state and local subsidies per job are much higher if Foxconn falls well short of the job creation targets.
Under the contract, Foxconn can get the maximum capital investment credits even if it falls well short of each year’s job target. For example, Foxconn can receive the maximum annual cash subsidy (“tax credit”) of nearly $193 million per year even if it employs only 520 people at the end of this year (25 percent of the target level) and 1,820 at the end of 2020 (which is just 35 percent of that year’s target of 5,200 jobs). Under that lower employment scenario, the job creation payments to Foxconn would be lower, but the investment subsidies are much less tied to the job levels.

In light of that factor, plus all the upfront subsidies that are independent of job creation, the total cost of state and local subsides will be much higher per job if Foxconn builds a smaller plant with fewer employees than initially promised. The huge subsidies for each job created are a concern for many reasons, including the fact that the revisions to Foxconn’s plans make it far less likely that project will have the purported employment benefits for blue collar workers and communities of color in southeast Wisconsin.

Via Foxconn – the only thing we know is that it’s a really bad scam @ Jake’s Economic TA Funhouse.

Thirst 

Just to give an approximation for the purposes of visualization: A gallon of water weighs 8.36 pounds and a typical semi-tanker can hold about 6000 gallons of water legal weight for transport.

So after doing the math for 7 million gallons per day that would mean the equivalent of looking at over 1,100 semi tankers of water. Of course they’re not trucking it but it gives you an idea to visualize the magnitude. Every day.

As an example, if you went to park 1,100 semi tankers end to end they would stretch for over 14 miles. Looked at another way, if you jammed them all together with no space between them in the most compact parking area you would need a lot that is almost 4 miles by 4 miles or almost 16 square miles.

Via The Political Environment: Foxconn’s diversion = Every day, 1,100 water tanker trucks. In 14-mile line.

Unquenchable 

But serious objections to the diversion’s wisdom and legality under the Great Lakes Compact were raised by citizens at a public hearing earlier this month.

Additional objections across the Great Lakes region were mentioned in this non-partisan media report; I also wrote that some objections are amplified by Walker’s damage to Wisconsin’s environment and his debasement of the Department of Natural Resources – – the state agency which will review and can approve the Foxconn diversion application, all discussed here:

the heavily-resisted push for a Lake Michigan diversion for Foxconn adds to Wisconsin’s status as a Great Lakes environmental outlier.

Via The Political Environment: NY, Illinois raise questions about Foxconn bid for Lake Michigan water.

Making it up as they go along

The Foxconn plant isn’t even built yet, but the Walker Admin and its allies (including a few local apologists for corporate welfare in Whitewater) now resort to fantastic, magical claims about how much economic development will come from nearly four billion in taxpayer subsidies.

So magical, so fantastic, that they now claim an 18-1 multiplier (yes, really):

A fully built Foxconn Technology Group plant would add $51.5 billion to Wisconsin’s gross domestic product over the 15 years the state pays incentives to the company, a new analysis by the Metropolitan Milwaukee Association of Commerce concludes.

That would equate to $18 of economic impact for every $1 spent by the state, the business group, which worked to help attract Foxconn, said.

Averaged over the 15 years, the MMAC’s estimate amounts to an additional $3.4 billion annually in state gross domestic product from Foxconn. That would tack another 1% onto Wisconsin’s current GDP of about $313 billion.

Via Foxconn as Alchemy: Magic Multipliers @ FREE WHITEWATER.