Foxconn For Dummies

Remember all the hoopla about Scott Walker’s deal with Foxconn? As the New Yorker summarized it,

When it was signed, less than two years ago, the deal that Wisconsin struck with the electronics giant Foxconn contained all kinds of headline-grabbing numbers: the company promised a ten-billion-dollar investment in the state, a new 21.5-million-square-foot campus for manufacturing L.C.D. screens, and as many as thirteen thousand new jobs, paying an average wage of fifty-four thousand dollars a year. The manufacturing facility would be the Taiwan-based company’s first U.S. factory, and the prospect stirred the hopes of a region that still dreams of clawing back the middle-class factory jobs that were its pride in the middle of the twentieth century and that it lost to foreign competition long ago. As Dan Kaufman wrote for The New Yorker last year, the deal also appeared poised to give a boost to the reëlection prospects of Scott Walker, the conservative Republican who was then Wisconsin’s governor, who transformed the state into a bastion of conservative, free-market politics.

Scott Walker’s version of free markets differs rather considerably from mine; giving huge subsidies via tax abatements and other government goodies to large enterprises hardly equates to a competitive marketplace where manufacturers and sellers contend on equal terms with others.

Trump, of course, applauded the announcement as evidence that he–the self-described great dealmaker– was bringing manufacturing back to the U.S. (although from what I read, he had nothing to do with making the deal originally).

As the details of Walker’s great coup leaked out, and Wisconsin citizens found out what the state had promised, the coverage became considerably less rosy.

But since then Wisconsinites have found out a lot more about the $4.5 billion in taxpayer subsidies that Foxconn was promised—money the company was being given despite the dramatic cuts that the state has made, in recent years, to education, infrastructure, and other public spending—along with the pollution waivers and special legal privileges that it was granted and the bulldozing of neighborhoods that it needed to acquire the land it wanted.

Those details helped defeat Walker in the gubernatorial election. But the state was still on the hook for the promised subsidies.

To add insult to injury, the company recently–and significantly– backpedaled on its commitments, telling Reuters it isn’t even going to manufacture in Wisconsin, and will employ mainly research and development workers. As a result, some of the incentives the state originally promised will be left on the table, but others are irreversible. Millions of dollars of highway money have already been redirected to support Foxconn’s project, and a number of homeowners have been “cleared” from the area designated for the factory.

Time Magazine reported that, following a telephone call from Trump in the wake of the no-manufacturing announcement, the company said it would build a smaller factory after all.

I wonder what Trump promised them.

The Foxcomm scandal is just a particularly egregious example of corporate welfare; bribery ( subsidies and an absence of regulation) has become a commonplace element of what is delicately called “economic development.”

This clusterf**k is simply added evidence that America’s economic system is corporatism, not market capitalism. The dictionary defines corporatism as the control of a state or organization by large interest groups, and adds that “fascism was the high point of corporatism.”

Real capitalists are screwed.

Comments

Left, Right, Center–REALLY?

As the competition among Democrats vying for the party’s presidential nomination heats up, pundits are warning against taking the party “too far to the left,” or alternatively reminding readers that “centrists” are failing to connect with the party’s rank and file.

We are once again entering bullshit land, where labeling takes the place of analysis. Plop a label on a policy proposal and suddenly it is a call to arms: if the label says “left,” self-identified conservatives and centrists bristle and oppose it; if the label says “centrist” or “moderate,” it is reflexively opposed by self-identified leftists.

Needless to say, no one is considering the proposal on its merits.

This rush to categorize candidates and policies as right, left or center is not just misleading, it is lazy and often irrelevant (not every policy position can be crammed into a nice neat ideological box). This habit has irritated me for years– in fact, in 2003, I wrote about it.

Periodically, someone will respond to a column I have written with a statement beginning “well, you liberals always…” Being dismissed as a liberal always amuses me, because I hold precisely the same political values I held in 1980, when I was the Republican nominee running for Congress against Andy Jacobs, and a fair number of voters found me “too conservative.” The only thing that has changed is the label….

Well, to be fair, the GOP has also changed, galloping off to the radical far right, and pulling the “conservative” label with it. But I stand by the following paragraph:

This mania for labeling people so that we don’t have to engage with them on the validity of their ideas has accelerated during the past few years. Perhaps it is talk radio, with its tendency to reduce everything to name-calling sound-bites. Admittedly, it is much more efficient to call a woman a “feminazi” than to take the time and effort needed to discuss why her positions are untenable. And the tactic certainly isn’t limited to Republicans; Indiana’s very own Evan Bayh has solemnly warned the Democrats against the danger posed by “leftists” like Howard Dean. (I’m not quite sure when Dean’s support for gun rights, the death penalty and a balanced budget became “far left” positions. Perhaps when they were espoused by someone the Senator isn’t supporting.)

Labelling an opponent’s proposal as “extreme” (left or right) is a tactic to undercut that proposal without actually engaging with it.

Allowing citizens to opt into Medicare (i.e. making Medicare a “public option”) or advocating expansion of the program (“Medicare for All”) are hardly proposals to dismantle capitalism. They are proposed solutions to a real and growing problem. Imposing higher marginal tax rates on the rich would return us to tax policies that used to be widely endorsed by both parties. Doing so would hardly turn America into a communist gulag.

These and other proposals may or may not be sound policy. We won’t know if we refuse to   address the particulars of suggested policies and instead simply label and dismiss them.

Pundits notwithstanding, the truth of the matter is that America doesn’t really have the sort of leftists that have long been active in Europe. What passes for left-wing in the United States is moderately progressive. To the extent there is extremism in the U.S., it is on the radical right, and the most important task facing Democrats and Independents is to rid the nation of Donald Trump and Mitch McConnell.

Flinging labels at each other won’t get that done.

Comments

Under Cover Of Jargon

The Indiana Statehouse is confusing. Often, that confusion is intentional. Lengthy bills are written in turgid “legalese,” and go on for pages. I’m a (recovered) lawyer and my eyes frequently glaze over.

And very often, you don’t have to be a hard-core libertarian to wonder: is this law really needed?

That was my first question when I received an email asking about Senate Bill 471, described as follows:

Would heighten the penalties for protests near oil and gas pipelines and other infrastructure by creating the offenses of “criminal infrastructure facility trespass” and “critical infrastructure facility mischief.” The bill provides that an individual who knowingly enters critical infrastructure facility without permission commits critical infrastructure facility trespass, a Level 6 felony punishable by up to 30 months in prison. Under the bill, recklessly or knowingly defacing such a facility constitutes critical infrastructure facility mischief, punishable by up to six years in prison as a Level 5 felony. In either case, the individual may additionally be liable to the property owner for damages, costs, and attorney’s fees. An organization found to have conspired with an individual who commits either offense may also be liable for a fine of $100,000. The bill newly defines “critical infrastructure facility” under Indiana law to include a range of oil, gas, electric, water, telecommunications, and railroad facilities, as well as any “facility that is substantially similar” to one of the listed facilities.

No one wants to see a “critical infrastructure” damaged. But a bit of digging suggests that more is going on with this bill–being pushed in several states by ALEC, evidently in reaction to Dakota pipeline protests– than the protection of “critical” utilities.

As my correspondent notes,

This description is accurate, but to get into more specifics one of the most troubling provisions is Ch. 10, Sec. 4 that says if an organization is found to be a conspirator with a person convicted of either trespassing or committing criminal mischief on “critical infrastructure” the organization can be fined up to $100,000. Sec. 5(a) could also potentially be interpreted as creating a cause of action by someone who has suffered damages not only against the person who caused the damage, but an organization found to be a conspirator with that person, to recover those damages. If that was the case the organization could be liable for more than a $100,000.

A Sierra Club officer explains the effect:

A couple of years ago the Hoosier Chapter was in discussions with some Northwest Indiana groups about a protest at the BP Whiting Refinery to oppose its expansion to allow it to process tar sands petroleum. When it became clear that some of the groups were contemplating civil disobedience, the chapter withdrew from the discussions, since the Sierra Club forbids illegal activities. In the event, about 40 people sat in front of an access to the refinery and were arrested for trespassing. I believe that most were let go without a fine. Under the proposed law, could we be found to have participated in the protest even though we withdrew? Could we be found liable for informing the public about the protest via our website, FB, and twitter, even though we didn’t support the civil disobedience? Certainly we would have to think long and hard about even participating in such discussions under this bill.

And that, I think, illustrates the actual purpose of the bill: to stifle dissent.

Indiana already has laws against trespassing and damaging property. S.B.471 ramps up the severity of the potential charges–from misdemeanors to felonies–and greatly increases the penalties. Although the bill contains a recitation that it is not intended to apply to “constitutionally-protected activities” (a provision added to mollify opponents of the measure), the question from the Sierra Club officer illustrates the chilling effect.

If one or two people at a protest inflict damage that was unintended and unforeseen by others, those others–including not-for-profits and civic organizations–run the risk of being hit with enormous fines. Of course they would “think long and hard.” That’s the whole point.

I am aware of no evidence that existing measures against trespass and property damage are inadequate or ineffective. But unnecessary and chilling as it may be, S.B. 471 is apparently moving “under the radar” toward passage.

This is how it’s done by the big “players” who understand how the system works.

While public attention and media coverage (such as it is) are focused on high-profile measures like bias crimes and teachers pay, troubling laws get a pass–in both senses of that word.

Comments

An Excellent Example

Ever since my days as Executive Director of Indiana’s ACLU, I have tried to explain the philosophy behind the First Amendment to well-meaning citizens who simply wanted to shut down those people spreading “bad” ideas, or later, to students who couldn’t understand why people they found hateful (many of whom were, indeed, hateful) were being allowed to peddle their bigotry.

I still remember a hearing held by a City-County Council committee “investigating” the Marion County Library because it allowed minors to access books that the chair of the committee considered inappropriate. (She wasn’t mollified by the fact that the library honored the directives of parents who didn’t want their kids to access certain materials. She explained that a lot of parents weren’t–in her eyes, at least–good parents who would avail themselves of the opportunity to censor their children.)

I don’t know how often I’ve tried to explain that the Bill of Rights–and especially the First Amendment–answers the question “who decides?” The Bill of Rights is a list of things that  government doesn’t get to decide.

I just read one of the very best explanations of that simple rule that I’ve come across. It was written by Wally Paynter, Executive Director of the Tri-State Alliance, in response to folks who want the Evansville Public Library to discontinue its “Drag Queen Story Hour.”

A few quotes:

Some members of the community are trying to limit what library programs are available to the public. It is similar to banning books. As an EVPL patron, I have a choice of what books I read and what programs I attend. However, it is not my right to decide what books other patrons are allowed to read and what programs others are allowed to attend….

Some Christians oppose Santa Claus, stating it takes away from the reason for the season. My pastor does Santa Claus Story Hour at the EVPL locations. Those who oppose the character Santa Claus do not try to stop other parents from bringing their kids to the event. They just don’t take their kids.

The same is true for Halloween. Some Christians oppose the celebration of Halloween. But do we end Halloween events at EVPL, or do we let parents choose what programs to take their kids to?

The letter also calls out the homophobia being expressed during this debate, a reminder that it is all too often marginalized people who are censored. But the most powerful point being made is reflected in the quoted paragraphs: our Constitution protects individual autonomy–the right of each of us to form our own moral, religious and political opinions, to determine what is important in our lives (what philosophers call our telos) and to choose how to live those lives.

So long as we do not harm the person or property of others, and so long as we are willing to respect the same rights for others, we are free to “do our own thing.”

Don’t like that magazine? Don’t read it. Don’t approve of that play? Don’t see it. Think that book is scandalous? Don’t buy it. Don’t approve of drag queens reading books to kids at the library story hour? Don’t take your kids.

In our system, you have the right to decide what you will read, attend and believe. But as Wally Paynter points out, you don’t have the right to decide what other people will read, attend and/or believe.

Live and let live is evidently really hard for some people.

Comments

Race And American Inequality

This is Black History Month, but rather than a post on black history, I think it may be useful to share some depressing information about the current status of African-Americans vis a vis the White Americans who have occupied a privileged social position in this country even after most of the legal disabilities targeting people of color were repealed.

The Institute for Policy Studies recently issued a report on the wealth gap between whites, Latinos and blacks in the United States.The report looked at trends in household wealth among Black, Latino and White households over the past three decades.

Since the early 1980s, median wealth among Black and Latino families has been stuck at less than ten thousand dollars, while the median wealth of White households, adjusted for inflation, grew from $105,300 to $140,500. The median White family has 41 times more wealth than the median Black family and 22 times more wealth than the median Latino family.

The wealth gap has gotten wider as wealth in America has become extremely concentrated.The median American family of any color has seen its wealth drop 3 percent between 1983 and 2016–a period of time in which the richest 0.1 percent have seen their wealth jump 133 percent. The three wealthiest families–the Waltons, the Kochs and the Mars–have seen their wealth increase by nearly 6,000 percent.

Wealth held by members of the Forbes 400 equals that of all Blacks plus a quarter of Latinos.

The  report takes issue with analyses that treat the racial wealth divide and the growth of economic inequality as two separate issues; instead, it finds that they are mutually reinforcing outcomes of larger economic issues–issues that result from public policies that have favored–and continue to favor–both White Americans and the very wealthy.

Just one example: As this is being written, Mitch McConnell and the Senate GOP are proposing to eliminate what they like to call the “death tax,” and the rest of us call the estate tax.

The estate tax raises $20 billion dollars a year, which is a lot of money, but a pretty insignificant part of the federal budget. It applies only to estates worth more than $5.5 million dollars, and people with lots of money can pretty easily structure their wills to avoid it.

As the Atlantic points out, however, there’s more than money involved in this debate.

The tax code is more than a ledger. It is a national statement of values. And so this little law inspires a great commotion during each tax debate. To its opponents, it is the ultimate (literally) punishment on success and an affront to the family legacy that each striving individual hopes to leave. To its supporters, it is a necessary bulwark against inherited plutocracy, which offends the national virtue of merit over privilege.

The article goes through the arguments advanced in favor of repeal and in favor of retention of the estate tax, and is worth reading for a quick review of the debate. But the argument for retention most relevant to policy’s role in worsening inequality is that, in a period defined by the rising gap between rich and poor, we need to recognize the enormous role played by inheritance.

According to analysis byMatt Bruenig, a writer and the founder of the advocacy group People’s Policy Project, four out of 10 members of the wealthiest 1 percent inherited some money, with an average inheritance in the millions of dollars….

In the last half century, the average wealth of the bottom half has gone from about nothing to about $1,000 in debt. Meanwhile, the returns at the top have accelerated. In the 1960s, families in the top 1 percent were six times wealthier than families in the middle, according to the Urban Institute. By 2016, the 1 percent was 12 times wealthier than the typical family. As wealth inequality has soared, the estate tax has been diminished, with the number of estate tax returns declining by 76 percent between 2006 and 2015. There is little doubt that 21st-century tax policy has assisted the concentration of wealth.

When ostensibly color-blind tax policy benefits “haves,” that policy inevitably benefits Whites.

And let’s face facts: money is power.

Comments