This WRAL story shows just how clueless Gov. Perdue is about the market economy (as if we needed any more evidence).
A day after Dell Inc. announced plans to close its computer manufacturing plant in Forsyth County and lay off all 905 workers, Gov. Beverly Perdue defended the state recruiting incentives that helped lure the company to North Carolina.
First off, is it really so hard to admit the State made a mistake? “We erroneously took a huge gamble on bribing Dell to bring its facility here, and we ended up being wrong with all of our predictions” is what the NC Dep’t of Commerce and Governor’s press release should read. Moreover, the WRAL story shows that
Dell is the 12th company not to fulfill its obligations under a Job Development Incentive Grant from the state. Five others withdrew from the program, three declined the grant once it was offered and three had their grants terminated
North Carolina has awarded 95 JDIG grants since 2003.
So already in just six years, 23 out of 95 companies have failed to deliver in the JDIG program – a failure rate of one in four. No doubt more failures are soon to come.
Not to be discouraged by, you know, actual results – Perdue insists the State will continue to pretend it has omniscient powers to foresee which specific businesses it should bribe:
“When 49 other states are using incentives, if you want to compete (you have to as well),” she said. “Maybe the people of North Carolina want to pull up the rug and say we don’t want jobs, but I’m not at that place. I think we need to be aggressive on jobs, and as long as I’m governor, we’re going to be.”
As a former teacher, one would think that Perdue should know better than to cave to childish peer pressure – “Gee, everyone else it doing it; it must be a great idea!” Perdue is in complete denial if she thinks the incentives game is a winning economic strategy. So what if every other state is doing it? Let them! North Carolina should cut tax rates across the board, tax all businesses the same and stop distorting the allocation of resources in our economy by awarding businesses with the best lobbyists.
The incentives debacle, however, is merely another chapter in North Carolina’s growing book of destructive policies. Witnessing the continued decline in fiscal policy in this state is depressing. Over the last several years, our esteemed rulers in Raleigh have been guided by such ridiculous notions as:
- No need to set aside surplus revenue during good economic times for a rainy day – spend it all now!
- Raise taxes during a recession – what a great way to spur recovery!
- Tax the “rich”, they won’t care. It’s not like they would use the money to create jobs or anything.
- What do you mean government can not “create” net new jobs? Government money is free – there is no such thing as opportunity costs.
- Of course a small group of politically-motivated people can centrally direct the economy’s resources better than millions of privately acting individuals voluntarily exchanging goods and resources based on their preferences and localized knowledge. Just look at the success of Skybus Mako Marine Silver Line Randy Parton Theatre Dell …uhhhm Apple?
That state leaders insist on continuing with such failed policies displays their short-sighted obsession with maintaining power. Until the voting public wises up to such policy failures, we can just expect more of the same.