Friends in the Wisconsin Legislature, we beg you: Sign that bad deal with Foxconn.
It’s the neighborly thing to do.
Best we can tell, it’s a crap shoot as to whether luring the giant electronics company to Wisconsin would work out well for you, given the billions of dollars in tax breaks your governor has promised, but it would be terrific for Illinois. It would cost our state nothing, yet up to half of the new jobs could go to our residents, while O’Hare Airport would get the new international travel business.
The best thing that ever happened to Illinois might be losing Foxconn to you, Wisconsin. Much appreciated.
Truth be told, this whole sad spectacle of Midwestern states fighting each other for economic development, each trying to outdo the other in prostrating itself before some international conglomerate, is foolish, and the Foxconn deal is proof. If Illinois and Wisconsin had joined forces from the beginning to bring this manufacturing plant to the region — maybe even pulling in Indiana as a partner — the final deal with the Taiwan company might have been less of a give-away, and the risks would have been shared.
To be a player in the global economy, size matters. Working together, the Midwest is better positioned to leverage its strengths, including a highly trained work force, superb universities and a central location. But because Illinois, Wisconsin and the rest of the old Rust Belt states fail to do so, big companies like Foxconn play them off each other. The result is the kind of questionable deal Gov. Scott Walker has cut for Wisconsin.
In an op-ed last Friday in the Milwaukee Journal Sentinel, Walker said the agreement reached with Foxconn would be “transformational” for Wisconsin, creating 13,000 new high-tech jobs on a factory site the size of 11 football stadiums. Employees would manufacture liquid crystal display (LCD) panels and other electronic components.
But Walker downplayed the $3 billion worth of tax incentives that the Wisconsin Legislature still must approve, and an independent analysis says it would take at least 25 years for Wisconsin taxpayers to break even on the deal. The break-even point would come even later, according to the analysis by the Legislative Fiscal Bureau, if Foxconn employed closer to only 3,000 — which could happen — and 40 percent or more of those jobs went to people who live out of state. In Illinois, that is.
Under that scenario, an analyst for the Bureau told Reuters, the break-even point would be so far in the future that it’s “silly to talk about.”
The study also says, though, that thousands of “indirect jobs” would be created by, for example, suppliers to the Foxconn plant. For the sake of Wisconsin, and Illinois, we hope that’s true.
Wisconsin would be taking all the risks, even as Illinois enjoyed a nice share of the benefits. The Foxconn plant likely would be located right across the border in Kenosha County or Racine County. The commute from Waukegan to Kenosha is just 16.5 miles. The commute from Zion is ten.
Border wars are stupid. Interstate job-poaching is nothing but a race to the bottom. And the best way to tap global markets would be to create a regional economic development strategy.
In the meantime, how bad is rush hour traffic on I-94 south of Kenosha?
Maybe we’ll take Metra.
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