Monday, December 03, 2012

Consider the Term "Pro-Business"

For years, mayors and governors anxious about local jobs
 had agreed to G.M.’s demands for cash rewards, free buildings, 
worker training and lucrative tax breaks. As late as 2007, 
the company was telling local officials that these sorts of
 incentives would “further G.M.’s strong relationship” 
with them and be a “win/win situation,” according to
 town council notes from one Michigan community.
Yet at least 50 properties on the 2009 liquidation 
list were in towns and states that had awarded
 incentives, adding up to billions in taxpayer
 dollars, according to data compiled by The New York Times.
Some officials, desperate to keep G.M., offered more.
 Ohio was proposing a $56 million deal to save its 
Moraine plant, and Wisconsin, fighting for its Janesville 
factory, offered $153 million.
But their overtures were to no avail. G.M. walked 
away and, thanks to a federal bailout, is once again
 profitable. The towns have not been so fortunate,
 having spent scarce funds in exchange for thousands of
 jobs that no longer exist.
One township, Ypsilanti, Mich., is suing over the 
automaker’s departure. “You can’t just make 
these promises and throw them around like they’re
 spare change in the drawer,” said Doug Winters, the
 township’s attorney.
Yet across the country, companies have been 
doing just that. And the giveaways are adding up 
to a gigantic bill for taxpayers.

Though I was taught about the stakeholder model of
 business, I've never really seen it in my 22 year career 
post military.  Probably another academic pipe dream
 we were supposed hope for.  
Maximizing shareholder value is the rule of the day.
It is clearly insufficient.  
Crony capitalism on the local level.  

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