Monday, November 13, 2017

At public expense, Foxconn gets low bar, Walker high praise

You were wrong if you thought that the Scott Walker-created Wisconsin Economic Development Corporation - - a state agency which expends favors and tax dollars - - would shy away from touting Walker now that he's officially running for re-election as WI Governor.

In the news release posted on a taxpayer-paid WEDC website announcing the Foxconn contract signing, Walker's name is mentioned five times in the release headline and first five paragraphs, and once more, just for luck:
(Full Foxconn archive on this blog dating back to the beginning, here.)

And so that Walker did not feel cheated, the same WEDC release and headline are also posted on Walker's officia, publicly-paidl state website, so publicly-paid staffers in two departments made doubly-sure he's got full credit.

The release headline also overstates by $1 billion the amount of investment Foxconn will make in order to receive $3 billion in state subsidies which Walker and the Legislature approved, and $764 million in additional local subsidies the state action will trigger.

In gestures towards accuracy, the WEDC release gets around to referring Foxconn's pledge as "up to" $10 billion, and an "estimated" $10 billion, but the figure of $9 billion reported by media based on documentation is nowhere to be found.

Or to pass Walker's lips, because that zero in $10 billion bumps the pledge into double-digit heaven and really ties the whole Foxconn thing together.

We made history with yesterday’s Foxconn contract signing. The deal includes 13,000 new Wisconsin jobs and a $10 billion capital investment. Welcome to Wisconn Valley!

Proud to finalize the Foxconn contract -- the largest capital investment in WI history! The $10 billion investment will create 13,000 family-supporting jobs!
Note also that Walker always treats 13,000 jobs as a given, and not an estimate. Never let certainty, or round numbers, or a clear understanding of what a job-created-actually is get in the way of the truth.

So we turn to the always-informative Jake's Economic TA Funhouse blog which has been pointing out that the contract could allow Foxconn to manipulate what counts as a reimbursable job, and when:
For each [Annual] Period, employ at least the Minimum Cumulative Full-Time Jobs set forth…, which shall be determined based on the number of Full-Time Jobs held by Full-time Employees employed by the Recipients [Foxconn] as of the end of the Period….
In determining whether a Partial-Year Employee is employed by the Recipient as of the end of a Period… (1) Partial-Year Employees who are employed in Full-Time Jobs as of the end of the Period will be counted, and (2) Partial-Year Employees who are not employed in Full-Time Jobs as of the end of the Period will not be counted.
Also concerning to me is how "Foxconn jobs" are defined in the contract. 
"Full-Time Job" means an employee position in the [Foxconn Enterprise] Zone or outside the Zone, but within the State of Wisconsin, and for the benefit of the Recipient's operations within the Zone, filled by a Full-Time Employee whose entire Wages are treated as paid in Wisconsin under Wis. Stat 71.25(8)(b). 
Sure makes you wonder what is "for the benefit of the Recipient's operations". Could that be a business that supplies the Foxconn cafeteria with food? Could it be contractors doing Foxconn's books located somewhere outside of Racine County? If so, we might be talking a lot less than 10,400 jobs actually occurring at the Foxconn site, and how much of that activity might take away from other business that is not being given tax incentives? Sure seems like a wide loophole.  
Props to the blogger.

Final thought: 

Isn't requiring the company by 2018 to create only 260 of those the 13,000 jobs Walker keeps touting - - a mere 2% - - a set-up through easily-met low expectations to make Walker look like the job-creating success of his fantasies?

During a campaign, no less?

Though we know for a true fact that Walker has failed in nearly seven years as Governor to create the 250,000 new private sector jobs he promised he'd create after one, four-year term, even wishing he could tattoo the figure on the foreheads of his cabinet secretaries when he and they took over the government in January, 2011.

And the number of new jobs on Foxconn's terms only has to rise another 2% to another 520 jobs in 2019 for state millions to come Foxconn's way.

Was the Foxconn contract drafted to change Walker and WEDC's job-creating narrative through glitzy big round number- estimates and easily-attained starter job data to distract voters from dubious numbers, documented job-creating failures and flat-out scandal?

Speaking of numbers, my Eight-Ball; says "yes."


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