Boots & Sabers

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Tag: Foxconn

Barca Takes Heat for Foxconn Vote

In the Democratic Party, no independent thoughts are allowed.

Subeck, in an email sent to all Assembly Democrats obtained by the AP, accused Barca of failing “on all accounts” to differentiate his views on Foxconn with that of the rest of Democrats who voted against the measure. She was particularly upset with Barca for holding an impromptu news conference in the Assembly parlor, right around the corner from his office, shortly after the evening vote Thursday.

“I have to admit that I was surprised that immediately after a vote on which you took a different position than most of the caucus, you would hold yourself out to speak on our behalf on the issue, especially without letting any of know you intended to do so,” Subeck wrote to Barca. “I am also concerned that the message you conveyed … It seems you were trying to justify your own vote rather than share the caucus perspective consistent with our agreed upon message.”

She said that Barca’s public comments “have not been consistent with the majority position of the caucus and have served counter to our interest.”

Subeck said Barca should have allowed someone else to speak who could better represent how most Democrats felt about Foxconn.

I think that most people watching Barca speak understood that he was speaking for himself and not on behalf of his caucus. We know the hive mind even if the occasional drone strays.

Assembly Debates Foxconn Deal

Get ‘er done!

Calling the Foxconn vote “one of the most important votes in Wisconsin history,” Vos said the Assembly’s actions today “will speak louder than the ugly words from hate groups.”

“We will approve legislation that will give hope to all Wisconsin families by providing a future that’s rich with career opportunities and a strong, healthy economy,” he said.

Assembly Pushes Forward With Foxconn Bill

I’m glad to see some urgency on the part of the Assembly.

Assembly lawmakers on Monday will cast the first votes on a package of incentives designed to convince Taiwanese electronics manufacturing giant Foxconn to build its first U.S. plant in Wisconsin.

Lawmakers on the Assembly Committee on Jobs and the Economy will vote Monday afternoon to advance Gov. Scott Walker’s bill that provides Foxconn with nearly $3 billion in tax credits, exempt the company from a number of environmental regulations and spend $20 million in state funds on job training to ensure the state’s workforce is prepared. The full Assembly is scheduled to vote on the package Thursday.

But a leader of the state Senate said Monday the Assembly’s action this week is “largely irrelevant” and that changes recently made to the bill by Assembly Republicans on Friday may not have the support from Walker or Senate Republicans.

Senate President Roger Roth, R-Appleton, told conservative talk radio show host Jerry Bader on Monday that the speed at which the Assembly has pushed the Foxconn bill has the Senate on the outside looking in.

It worries me that the Republicans running state government can’t seem to get their acts together on this. Why is it so difficult to get in a joint committee, hash out the details, and get this thing done? The answer is that it isn’t difficult – if they wanted to do so. Several Republican leaders appear to be using the Foxconn package as a political football for other agendas. In doing so, they risk fumbling it after Walker got it to the goal line. (yes, I’m ready for some football)

Measuring Foxconn’s Impact

This.

DOA estimates a total of 22,000 indirect jobs and those secondary positions (suppliers) supporting Foxconn’s operations will be created, with combined annual wages of $1.1 billion per year beginning in 2021.

“The way to judge this project is not by government revenues, not by government figures. It’s what it means to our overall economy,” said state Rep. Adam Neylon (R-Pewaukee), chairman of the Assembly’s Jobs and Economy committee. The committee held a hearing on the bill last week.

Foxconn “will grow our GDP, it will have a tremendous impact on our economic activity in the state. A lot of people will benefit because of this incentives package. We have a situation where we will be attracting talent instead of losing it,” Neylon added. “It’s a mistake to think that government revenue is the end goal. The ultimate goal is economic benefit, not how much more state government can take in and spend.”

There are a couple of things driving me crazy about this whole debate about the Foxconn deal.

First, as a small government guy, I share my fellow conservatives’ repulsion at government having to cut deals with companies to move here. I would much prefer that the government create an environment of low taxes, reasonable regulations, and good public infrastructure that makes Wisconsin attractive to all businesses. But that is not the world we live in. And as a pragmatist, the positive impact of having Foxconn in Wisconsin is worth a pragmatic incentive package to lure them here.

Second, what is it that people don’t get about tax credits? The vast majority of the incentive package negotiated by Walker and team is to give Foxconn tax credits in exchange for creating jobs. If Foxconn doesn’t move to Wisconsin, there will not be any taxes from them to credit. To call tax credits “handouts” or “government expenditures” is to assume that it was the government’s money to begin with. It is not. It is Foxconn’s money that the government is choosing to not tax for a period of time. And in this case, if Foxconn doesn’t live up to their end of the bargain, there won’t be any credits. Of course, if they don’t live up to their end of the bargain, there likely won’t be anything to tax anyway.

All things considered, tax credits are a no-brainer and a very easy way to provide incentives with no out-of-pocket expenses from the taxpayers. The only gripe I have about them is that I wish that everyone could pay less in taxes.

Third, I really wish the legislators would stop messing around with the deal. They all seem to want to have their own twist included. That’s exactly why the Obamacare repeal failed. And why Congress can’t seem to get anything substantial done. The legislature should treat this like a treaty at the federal level. Take the deal as proposed by Walker and vote up or down on it. The legislature still gets its say and has the ultimate power.

Making Foxconn negotiate the deal again, taking months, and larding the deal up with petty priorities is a recipe to kill it. That is the attitude that has been retarding economic growth in Wisconsin for decades. Is this a new era or not? Are these Republicans really interested in attracting businesses and jobs to Wisconsin or not? Their actions are speaking far louder than their empty BS rhetoric right now.

Get. It. Done.

Tribune Diagnoses the Wisconsin Way

Even those folks to our south recognize it.

The final reason Foxconn picked Wisconsin over Illinois is the difference-maker: government cooperation and competence. The Journal Sentinel wrote that Gou believed “the responsiveness of the public and private partners in Wisconsin far exceeded those of other states.” Gou singled out the cooperation of Gov. Scott Walker, U.S. House Speaker Paul Ryan, R-Wis., and local business groups: “These key people pushed very hard.”

Here’s the takeaway: Foxconn chose the state that has stable government, healthy finances and pro-growth policies for employers. Illinois has none of the above.

Wisconn Valley is open for business

My column for the Washington County Daily News is online. Here you go.

It is almost impossible to overstate how important the recently announced Foxconn deal is for Wisconsin. Economically, culturally, and politically, it is the biggest deal for Wisconsin in a generation.

The economics of the deal are astounding. Foxconn is a Taiwanese company that manufactures thousands of products all over the world. Its revenues exceed $136 billion per year and it employs well more than a million people all over the globe. The plant planned for Wisconsin to build advanced screens will be huge, but it will not even be Foxconn’s largest.

At 20 million square feet, the planned Foxconn facility in Wisconsin will be one of the largest in the world. It is estimated that Foxconn will spend $10 billion to build and equip the new facility and they have committed that $5.7 billion of that will be spent in Wisconsin. The construction alone will support 10,000 construction jobs for four years and 6,000 additional indirect jobs.

That’s just to build it. The ongoing economic impact is even more massive.

Foxconn estimates that the facility will eventually directly employ 13,000 people and indirectly employ an additional 22,000 people at an average wage of $53,875 plus benefits per year. They plan to spend $4.26 billion per year to supply the facility with about a third of those purchases happening in Wisconsin. All told, the facility is estimated to have at least a $7 billion annual impact on Wisconsin and generate an estimated $181 million in annual tax revenues. All of these estimates were done by Ernst & Young.

Economically, this single facility will have a generational impact on Wisconsin on the scale of some of the other major manufacturers of Wisconsin’s storied past. Culturally, it will have a similar impact.

Wisconsin has a proud legacy in making things. Manufacturing has been a pillar of the state’s economy for over a century. Due to many trends outside of the state’s control like automation, globalization, trade policies, etc., the state’s manufacturing sector has been eroding for years. Since 2006, Wisconsin shed 45,598 manufacturing jobs as other sectors grew. The state boasts some terrific manufacturing businesses, but as a sector, it has been in decline in the state.

The drain of manufacturing out of the state has not only drained jobs, it has drained neighborhoods, towns, and communities of their vitality. The Foxconn plant plugs that drain and pumps new manufacturing jobs, money, and investment into the state. It is also almost certainly the beginning of a flow of companies investing in Wisconsin. Wisconsin has made its mark again as a global center for high-tech manufacturing. Other companies will undoubtedly follow Foxconn’s lead.

The political impact of Foxconn is also substantial. There is no dispute that Gov. Scott Walker and the Republican leaders deserve a tremendous amount of credit for brokering the deal to bring Foxconn to Wisconsin. As the legislature goes into a special session this week to finalize and pass the incentive package, it appears that the state is getting a bargain. In a perfect world, taxpayers would not have to compete to lure businesses with tax incentives and corporate welfare, but that is not the world we live in.

Taxpayers are offering Foxconn about $3 billion in mostly income tax credits over 15 years and a $150 million sales tax exemption. Bearing in mind that this is mostly exemption from taxes that would not have been collected anyway without Foxconn locating in Wisconsin, it is a good deal and the taxpayers will reap a substantial return on their investment. Furthermore, the credits are tied to Foxconn’s actual performance in creating jobs and making capital investments in Wisconsin. If Foxconn fails to live up to its commitments, the taxpayers are not obligated to extend the incentives.

It must be acknowledged, however, that the Foxconn deal would not be happening had it not been for Walker and the Republican transformation in Wisconsin over the last seven years. Decisions like Foxconn’s consider hundreds of factors that are outside of the realm of politics. Conservatives often remind that government do not create jobs, but they create an environment in which business can flourish and create jobs. Walker and the Republicans have created just such an environment. Things like a balanced budget, regulatory reform and right to work combine with a general business friendly attitude to create an environment in which businesses can succeed. The Foxconn decision is not just the result of an agreement on an incentive package. It is the culmination of years of decisions making Wisconsin a better place to do business.

The Foxconn deal may have guaranteed Walker’s third term, should he choose to run for reelection, but more importantly, it has affirmed the correctness and importance of the conservative policies he has advanced. Now we must continue and accelerate those policies to capitalize on the momentum.

Foxconn Partnering with Rockwell

Wisconsin is already benefiting.

Foxconn has already announced a partnership with a major Milwaukee-based employer: Rockwell Automation.

But observers say more partnerships with companies like Johnson Controls and GE Healthcare are likely to happen as the Taiwanese company finds its footing in Wisconsin.

In one such agreement, Milwaukee-based Rockwell Automation will be collaborating with Foxconn to “increase operational efficiencies in electronics manufacturing to new levels,” Terry Gou, Foxconn chairman and CEO, said in a statement.

The two companies will be working together on workforce development and training. Foxconn says it has committed to work with Rockwell Automation and ManpowerGroup to provide skills training for military veterans.

Foxconn Coming to Wisconsin

It is difficult to overstate how big this is for Wisconsin.

Taiwanese manufacturing company Foxconn will build its first U.S. factory in Wisconsin, where it expects to employ between 3,000 and 13,000 people, officials announced on Wednesday.

The $10 billion facility would initially employ 3,000 people and could expand over time to create as many as 13,000 jobs, according to a senior White House official. The jobs will pay an average salary of $53,875, plus benefits, according to the Wisconsin Economic Development Corporation.

The project is the “single largest economic development project in the history of the state of Wisconsin,” said Gov. Scott Walker, who made the announcement on Wednesday at the White House with Foxconn founder and CEO Terry Gou.

Foxconn is best known for manufacturing Apple iPhones. The Wisconsin facility will produce liquid-crystal display, or LCD panels.

Yes, there are going to be some growing pains and I’m sure that the Democrats will be sure to pee all over Wisconsin’s economic flame, but this is a historic economic boon for Wisconsin. Here are a few projections from the WEDC summary:

In addition to the 13,000 jobs directly created by Foxconn, the project is expected to create at least 22,000 indirect and induced jobs throughout the state.

Foxconn is to make $4.26 billion in supplier purchases annually, about one-third of which will be sourced within Wisconsin.

The project is expected to have at least a $7 billion annual economic impact on the state.

The project will generate an estimated $181 million in state and local tax revenues annually, including $60 million in local property taxes.

“Huge, big numbers” for Foxxconn Subsidies

One wonders what the package will be.

MADISON, Wis. (AP) — A Republican state senator says the state may reach a deal with Taiwanese manufacturer Foxconn by the end of the month and budget talks are being delayed as an incentive package is worked out.

Sen. Luther Olsen tells The Associated Press on Thursday that talks are ongoing about what incentives the state may have to offer to get the iPhone manufacturer to commit.

Olsen says, “I think we should hold off on settling the budget until we know what’s going on with this.”

Republican Senate Majority Leader Scott Fitzgerald tells AP that “huge, big numbers” are being talked about to help land Foxconn. But he says he hasn’t discussed them yet with his caucus.

I am not opposed to sensible subsidies to lure large businesses to Wisconsin. The economic impact of something like Foxconn would be huge, so I would expect the incentives to be huge. As long as the benefits to the taxpayer outweigh the costs, let’s get this deal done.

What is more interesting is how this is impacting the debate over the state budget. Some folks are convinced that we need to hold off on a budget to see what the plan is while others are convinced that we need to get the budget done to demonstrate the state’s fiscal solvency. The fact that the Foxconn negotiation is impacting our state budget to this extent indicates just how big it is.

New Business and Jobs are Bad

This has to be one of the stupidest editorials I’ve read in a long time.

The sudden influx of 10,000 jobs in Janesville could only be a good thing, right?

Not necessarily.

News of Foxconn considering and then passing up Janesville as the site of a $10 billion expansion project might have left some people feeling disappointed. But we know from experience the pitfalls of allowing one company and industry to dominate the local economy.

The GM plant closing happened not even 10 years ago. Let’s not forget with its closing came the sucking sound of hundreds of people’s livelihoods disappearing. When a community relies on a big employer, its fortunes rise and fall with that employer, too. The car industry is notoriously cyclical, and Janesville endured many ups and downs through the years before the bottom finally fell out in 2008.

[…]

Sure, we’re puckering a little, here, from sour grapes, but winning 10,000 Foxconn jobs wouldn’t be a perpetual party for the economy. It would come with a hangover.

Their argument is basically that having a business open in town and create thousands of jobs is a bad thing because that company may leave one day and the jobs will go with it. In their view, unemployment is better because at least that can be perpetual.

What they ignore is the fact that GM created jobs, employment, and a good lifestyle for thousands of people for generations in Janesville. Yes, they eventually left and Janesville misses GM, but they are taking the wrong lesson from that experience. The lesson is that the city must diversify its economy to mitigate the negative effects of business closings. The lesson is NOT that they should eschew big businesses moving to town unless the business can guarantee that jobs will last for eternity.

Illinois Rooting for Foxconn in Wisconsin

Even the FIBs are rooting for it.

Southeastern Wisconsin is in the running to land a behemoth electronics manufacturing facility that could bring 10,000 jobs, a potential game-changer for the region if the deal goes through.

Taiwan-based Foxconn Technology Group, a major electronics manufacturer well known for making Apple’s iPhones, has announced plans to invest $10 billion to expand U.S. operations, and although it has not announced where or how that money will be spent, Wisconsin officials have let slip that their state is a top contender.

Illinois Gov. Bruce Rauner reached out to Foxconn earlier this year to make his own pitch for the project and the state “will continue to stay in contact as Foxconn works to consider locations and opportunities in the Midwest,” according to an emailed statement Friday from governor’s spokeswoman Eleni Demertzis.

But Foxconn appears to be zeroing in on a swath of Wisconsin just north of the border, which would still likely benefit Illinois as the company builds its workforce and supply chain.

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