Late in the legislative session, a bill to create new incentives for General Motors popped-up on the Missouri Capitol radar. With just over three weeks left in the 2019 session, the accidental governor’s administration pulled-in top legislators to explain why something big – $500 million in new taxpayer money – must happen right away…
“We just wrapped up a very productive briefing with representatives from General Motors, and House and Senate leaders — along with Director (Rob) Dixon of Economic Development,” Parson told reporters Thursday morning.
“I am excited that Missouri has a seat at the table to compete for a tremendous opportunity that will provide a boost to our state and our regional economy.” — News Tribune May 2, 2019
The harsh right wing within the Republican supermajority in the state Senate, of course, threw sand in the gears. Still, this bill was so, so important that (as obviously predictable) Mike Parson allowed the Conservative Caucus to execute a couple of hostages and the bill passed in the last days of session, the Truly Agreed version being sent to the governor on May 29th.
This legislation being so critical, the governor signed it just 42 days later…Wait, a six week delay before the signing of a vital new tax giveaway?
The decision by General Motors to make the investment in Missouri hasn’t been finalized, either, Dixon said. The company has shuttered five plants in the last year, but has also made or promised heavy investments at its plants in Kentucky, Tennessee, Michigan, Indiana and Texas…
Part of those negotiations include the number of jobs the state expects GM to retain in order to receive the tax credit, Dixon said. The Wentzville plant employs about 3,500 workers. During the legislative process, General Motors disapproved of a bill that would require it to retain 90 percent of the jobs at the plant, according to the top Republican senator.
Remember,
General Motors currently receives millions in tax credits through the state. Starting in 2014, it had received $33 million in tax credits under the MO Quality Jobs Program, according to a 2018 DED annual report.Also, it is able to forgo payments to the state through the Manufacturing Jobs Act, in exchange for making a capital investment of $75,000 per retained job at plants that created a new product or $50,000 per retained job at the facilities that expanded an existing project. — The Kansas City Star June 10, 2019
In other words, GM demanded – and got – possible new subsidies atop tens of thousands of dollars per worker per year already received. Yet, even throwing that extra $50 million a year into the stew may not bring General Motors to the table.
The accidental governor and the Missouri legislature got played.
There’s a saying among poker players that if you can’t figure out who the mark is at the table, well, you’re the mark, the patsy.
Common sense pointed to GM dealing from the bottom of the deck. While Missouri happily throws money at employers, the state skimps on highways, education and other things smart businesses value. Also, increasingly Missouri is a state with a bad reputation. Median income continues to slip below the national average. Legislative action on guns, abortion and taxes proudly proclaims that we are not in the mainstream, we are the new 50th state. Why invest money at the bottom of the pile?
Obviously, the accidental governor realized he was the mark. Missouri’s actions were needed to make the poker pot bigger for GM from the “winning” states.
What a couple of months ago was “do or die” became, well, never mind.
Glenn Koenen