Say Anything Blog

Isn’t Imation an example of the failure of “economic development.”

After all the government backed them to the hilt.  Now they’re leaving. 

One could make a case that in the long run this didn’t work out well for the community.

What’s going to happen to US industry when the global warming extremists like John McCain double the price of electricity?  I would think all these factories will close and set up in countries where they aren’t scared of technology.

The other thing is that statists like this take credit for what the tax dollars do, but willfully ignore the negative effects of taking that money out of the community.

Furthermore, Fargo has spent a ton of money on economic development.  If it actually worked then they wouldn’t need MORE money and a NEW tax.  The economic growth would pay the way with the old tax system.

What’s going to happen to US industry when the global warming extremists like John McCain double the price of electricity?  I would think all these factories will close and set up in countries where they aren’t scared of technology.

Isn’t Imation an example of the failure of “economic development.”

After all the government backed them to the hilt.  Now they’re leaving. 

One could make a case that in the long run this didn’t work out well for the community.

You could also make the argument that this was a success of economic development due to the sales and income taxes generated by the increased jobs in Wapheton that wouldn’t be there otherwise. I would bet that the return on the investment was fairly large for Cass County.

The plant there was just a victim of technological growth that made it more profitable to close down this plant and open up a new one somewhere else than to refit and retrain everyone at the current plant.  Just how the free market works.  Although I don’t like the tax hike talk, it looks like Cass County is at least trying to bring a new business in and hopefully retain the jobs that will be lost with the plant closing.

You have a breakdown of the increased sales and income taxes resulting from the Imation company versus what the sales and income taxes would have been if that money had been left with the people that earned it, right?

After all these economic development folks are professionals.  They clearly would be able to PROVE that they deserve the funding they rip away from our families.

What’s going to happen to US industry when the global warming extremists like John McCain double the price of electricity?  I would think all these factories will close and set up in countries where they aren’t scared of technology.

You have a breakdown of the increased sales and income taxes resulting from the Imation company versus what the sales and income taxes would have been if that money had been left with the people that earned it, right?

Don’t need one

You can’t generate tax revenue on money not being made and money not being spent.

Would you agree that a reduction of around 400 jobs in Cass County would reduce the amount of money spent and also sales tax generated in Cass County?

Would you agree that if the money would have been left with the earners they would have spent it and invested it and that would have created jobs.

Jobs that probably wouldn’t be leaving just now.  So now all of that money that was sunk in Imation is just that, sunk.

What’s going to happen to US industry when the global warming extremists like John McCain double the price of electricity?  I would think all these factories will close and set up in countries where they aren’t scared of technology.

I wonder where we got this notion that the indicator of good economic decision making was tax revenue.  Although there are many Democrats and Republicans who seem to think otherwise, government isn’t a business.  We shouldn’t seek to maximize revenues, we should seek to raise enough revenue to pay for the necessary functions of government and then give what’s left - if any - back.

Also, the government should not be “investing” in a local economy.  The government should be regulating it only to the most minimal degree and otherwise leaving it alone.

When the people fear their government, there is tyranny; when the government fears the people, there is liberty.

-- Thomas Jefferson

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Would you agree that if the money would have been left with the earners they would have spent it and invested it and that would have created jobs.

Would it be better left to the earners? Absolutly!

Would they have invested in and created jobs? You bet.

Would those jobs be in Cass County, ND?  Hell no!

Those jobs would be somewhere else in the US and not in Cass Co. and that’s the major point.  More jobs and more consumption benifit Cass Co. the most when the jobs and consumption are taking place inside of Cass Co.  That’s why you have economic development, to make places like Cass Co. more attrative to businesses who are looking to locate a large plant or business in an area.

Whistler,

You’re right on the money.  THose who believe in “Hoevenomics” think that if the tax money wasn’t collected that the people who kept the money would burn it so it would never be spent.

That’s wrong… they’ll use it, like you say, to create jobs and invest it in new companies.

theovermind99,

You’re not even using the terms correctly.  Economic development is an outcome… not a program.  It is the process of building an economy, not the “program” used to create it.

Sorry, you’re lost.

To listen to these economic development guys the world rises and sets on their say so.  Nothing good would ever happen without them pulling the strings.

Then their projects bomb out time after time and what do they cry, we need another tax to save what we didn’t build with all of the other tax money.

If Cass county’s economic development money was worth anything why would they need a new tax?

Would those jobs be in Cass County, ND?  Hell no!

Right, people are too stupid to spend money in their own town.  It’s best to take their money and spend it on something good.

What’s going to happen to US industry when the global warming extremists like John McCain double the price of electricity?  I would think all these factories will close and set up in countries where they aren’t scared of technology.

Uh oh, Brian is being very single minded in this.  I agree with whomever said Imation is an example of economic development failure.

A tax code that provides incentives to employers to move to the state and does not provide a tax code that is attractive for them to stay past the expiry of their incentives is nothing sustainable.  Companies will ultimately leave, as Imation is doing.

And the concept of give me your money to manage because I can do it better..........well I’ll bet Brian is voting Obama this Fall.

For Brian… it’s job security.  WHo wouldn’t want a $100 million budget?

You’re not even using the terms correctly.  Economic development is an outcome… not a program.  It is the process of building an economy, not the “program” used to create it.

You’re correct, I meant economic development commissions.  I’m sorry that I wasn’t clearer.

That’s wrong… they’ll use it, like you say, to create jobs and invest it in new companies.

The relevent point isn’t if they’ll do what you say, it’s where.  It’s alot better when they create jobs and invest in North Dakota as opposed to Chicago.  Sometimes you need to add value through tax incentives to get companies to do that.  Remember, North Daktoa is competeing in a free market for jobs with 49 (or 56 I can’t remember which one) states.  Sometimes that additional value is needed to get people to look your way.

Right, people are too stupid to spend money in their own town.  It’s best to take their money and spend it on something good.

It’s not that they’re too “stupid” as you say, it’s that they wouldn’t have the opportunity to spend it there.  If they don’t have a job and there are no prospects for jobs in their area, they’re going to look eleswhere for work.  That means that they aren’t going to spend money in that area.

I wonder where we got this notion that the indicator of good economic decision making was tax revenue.

Actually that Laffer Curve makes that claim in regards to tax policy.  For example, if you raise taxes and gov’t revenue drops you have made a bad economic decision

Funny I thought we had better things to do than maximize tax revenue for bureaucrats.

We should be on the low end of the laffer curve.  There’s no valid excuse to take my money and give it to some private party so that they can run a business.  If I think it’s a valid business I’ll invest in it myself. 

Economic Development corporations take money time after time and invest it in losers.  At the best they consider it a success if it increases tax revenues to the government never caring about if it actually HELPS THE PEOPLE who earned the money in the first place. 

By and large we can say no since increased business in Fargo hasn’t done a thing to keep property taxes in Fargo growing slower than the rate of inflation.

All it is is a giant government boondoggle meant to self perpetuate the chattering classes.

What’s going to happen to US industry when the global warming extremists like John McCain double the price of electricity?  I would think all these factories will close and set up in countries where they aren’t scared of technology.

There’s no valid excuse to take my money and give it to some private party so that they can run a business.  If I think it’s a valid business I’ll invest in it myself.

Here’s one: Increasing the tax base by bringing in more jobs would create downward presure on tax rates since a lower tax would create the same revenue.  Also you miss the point that this isn’t about making government richer, it’s about making a states (in this case North Dakota’s) economy better.  More businesses=better economy.  Some times you have you have to sweeten the pot to get a good company to locate here.  This is no different when companies sweeten the pot by offering tax free health care premiums, free money for your 401(k) and such.

Economic Development corporations take money time after time and invest it in losers.

80% of new small business die after 5 years.  It’s just a fact of our free market economy.  Some of them may be ones that Economic Development Funds have gone into. Also there is no guarentee that any investment is going to pan out. Stocks can go down too.

By and large we can say no since increased business in Fargo hasn’t done a thing to keep property taxes in Fargo growing slower than the rate of inflation.

Two different issues there.  The relevent one isn’t economic development funds but a city government not kept in check by the people.

I read further and looked at some of the graphs with the Forum article.  I disagree with some elements of “where” they should invest.

#5 is K-12 Education, especially science & math.  The citizens of Cass County already invest their tax dollars in K-12 ed!  North Dakota has already proven that one of its greatest exports (after wheat) is its people.  I don’t know the numbers on how many Fargo kids go to school at UND/NDSU but I would guess its less than 50%.  I know many that have gone to UofM and Notre Dame, those kids dont’ come back to Fargo/Moorhead.  But NDSU students (that have come from all across the state, or from MN or other places) MIGHT stay if there were good jobs.

NDSU already has a very strong Engineering program (i.e. those k-12 kids excelling in science & math) that attracts employers from all over the country (Boeing, LHMartin, etc).  So is Walters saying he wants to spend ED $$ to create more great human capital exports?  Precisely NOT what the more ND tax dollars should be spent on, North Dakota has already perfected that one.

Completely misguided use of Tax Dollars. Walters is from ND (northwest part of the state) and lived outside the state for a good portion of his career, he needs to re-think this one.

Increasing the tax base by bringing in more jobs would create downward presure on tax rates since a lower tax would create the same revenue.

So why is it that Fargo and Cass county have raised their taxes sky high?  Plus if that were the case you wouldn’t need another new tax to pay for more economic development.

Also you miss the point that this isn’t about making government richer, it’s about making a states (in this case North Dakota’s) economy better.

Once again if it was about that then all of the money we’ve thrown down the economic development hole would come back and pay us.  If you haven’t noticed business taxes are sky high as well as personal taxes.  The only thing ND has got going for it is a good workers compensation system and Hoeven and the Democrats are doing their best to ruin that.

More businesses=better economy.  Some times you have you have to sweeten the pot to get a good company to locate here.  This is no different when companies sweeten the pot by offering tax free health care premiums, free money for your 401(k) and such.

It’s a far different thing when an entity spends their own money looking for a return.  In the case of economic development they spend money without a care that the guy who’s money it actually is ever gets a return.

80% of new small business die after 5 years.  It’s just a fact of our free market economy.  Some of them may be ones that Economic Development Funds have gone into. Also there is no guarentee that any investment is going to pan out. Stocks can go down too.

That’s fine when you’re risking your own money.  I don’t see the advantage to me for the government to be playing the market with my money.

What’s going to happen to US industry when the global warming extremists like John McCain double the price of electricity?  I would think all these factories will close and set up in countries where they aren’t scared of technology.

So why is it that Fargo and Cass county have raised their taxes sky high?

Compared to other cities such as Devils Lake and Grand Forks, sales taxes are lower in Fargo.

Once again if it was about that then all of the money we’ve thrown down the economic development hole would come back and pay us.

Once again around 400 people not making money and not spending money would result in 0 tax generated while 400 people making and spending money would generate more than 0.  Also the loss of those jobs would probably put upward pressure on tax rates.

I guess the thing I don’t get here is how you would help get businesses into ND without Economic Development money.  Changing tax laws and regulation would help, but there are still several other factors that these companies consider that would be out of the states control.  How then would ND make up for those liabilites and attract businesses here that wouldn’t look our way?

I guess the thing I don’t get here is how you would help get businesses into ND without Economic Development money.  Changing tax laws and regulation would help, but there are still several other factors that these companies consider that would be out of the states control.

My question for you is: Why would we want to attract companies that need a leg-up from the government in order to come here?  Shouldn’t we want companies that can exist here without subsidy (and that’s exactly what economic development money is)?

It might take longer, but economic development through supply-side policies (which North Dakota’s ED efforts decidedly are not) might take a bit longer but that sort of growth is sustainable.

And much less prone to cronyism and corruption.

When the people fear their government, there is tyranny; when the government fears the people, there is liberty.

-- Thomas Jefferson

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Compared to other cities such as Devils Lake and Grand Forks, sales taxes are lower in Fargo.

Property taxes are sky high. 

Once again around 400 people not making money and not spending money would result in 0 tax generated while 400 people making and spending money would generate more than 0.

So who’s the economic genius that put all that money into Imation only to have them pull the rug out from under these 400 workers.  It’s hard to imagine that leaving the money in the taxpayers hands in the first place that things would be worse off.  That money would have gone into viable local business, not some kind of sexy tech company that was going to go.

I guess the thing I don’t get here is how you would help get businesses into ND without Economic Development money.

Laughing my butt off.  Do you really think that everything rises and sets with the government handing out favors of other peoples hard earned money?

How then would ND make up for those liabilites and attract businesses here that wouldn’t look our way?

Simple we can get John Hoeven to not run again and move out.  That’d remove a huge liability right there.

Better yet the liabilites that the government’s created like a poor tax environment should be done away with.  Quit treating businesses and productive people like cows to be milked and you’ll be surprised at the growth.

What’s going to happen to US industry when the global warming extremists like John McCain double the price of electricity?  I would think all these factories will close and set up in countries where they aren’t scared of technology.

theovermind99 :  The ED President wants a larger budget.  His budget right now is much larger than zero.  The issue under discussion here is if there should be a “larger” transfer of wealth from the taxpayers of Cass County to the “government” who is once again saying “I can spend your money better than you can....and just maybe someday, some of my spending will benefit you.”

No thanks.  Fargo-Moorhead ED dollars would be best spent lobbying the state government to state corporate taxes to attract more companies to the state.

My question for you is: Why would we want to attract companies that need a leg-up from the government in order to come here?  Shouldn’t we want companies that can exist here without subsidy (and that’s exactly what economic development money is)?

We should absolutly want companies to come here just for the things that this state can offer and not take a dime.  However, the type of time frame your looking at would be at least 20 to 30 years if at all for that plan to work.  Ideally, changing tax policies and barriers to entry would work.  However, we don’t live in an ideal world and your assuming no other state would be doing the same.  If a company had to chose between putting part of their operation in Nevada or North Dakota if both had the same tax laws would probably choose Nevada for circumstances beyond our control.  This is why we would need to add value to comming to North Dakota by extending Economic Development Funds to the company.  This is no different that what many small business people in this state do to compete with larger companies.

It’s hard to imagine that leaving the money in the taxpayers hands in the first place that things would be worse off.

Less job and less people in an area mean more upward pressure on tax rates.  Simple as that.  Besides, your have to spend money to make money.

Laughing my butt off.  Do you really think that everything rises and sets with the government handing out favors of other peoples hard earned money?

No I don’t.  But we won’t be laughing when Ag prices drop like a stone and our one trick pony of an economy turns south.  Then we will see huge pressure to raise sales, income, and property taxes.  However, if we had a more diverse economy, North Dakota would be better able to handle a downturn in the ag economy.  If some of our tax dollars were used to attract new businesses and industries into ND, that would benifit the economy and also help to put downward pressure on tax rate because greater number of jobs and people in the state.

Fargo-Moorhead ED dollars would be best spent lobbying the state government to state corporate taxes to attract more companies to the state.

The issue here is whether or not Economic Development Dollars are needed.  I think we all agree that taxes are too high and need to come down and we all agree that when taxes come down it would attract more companies to the state.  My point is that just changing existing tax law isn’t enough.  You are assuming that no other state is doing this.  For example, even if we cut income taxes 50% in ND, we’ll still have higher income taxes than in South Dakota, which has no income tax.  Even then there are companies which are locating to places other than the Dakotas because of issues other than tax law.  If we want to bring those businesses here we will have to do something different that can add value to coming to ND.  One of those things is Economic Development money and that’s why I think it’s needed.

overmind:

Once again, FM area DOES have an ED budget.  The issue is if that budget should be larger.  Walters clearly has a large enough budget to work to attract companies to the state, he’s done so the last 3 years.  But does he need to reach into the pockets of the Cass County taxpayers directly to exponentially increase his budget?  No.

I would argue ED dollars are worth it at the state level and Fargo Moorhead level, but not the amount Walters is asking for.  As for State Income taxes ND should go the way of South Dakota and abolish them.

Once again, FM area DOES have an ED budget.  The issue is if that budget should be larger.  Walters clearly has a large enough budget to work to attract companies to the state, he’s done so the last 3 years.  But does he need to reach into the pockets of the Cass County taxpayers directly to exponentially increase his budget?  No.

I agree