>>Why should ANY state government pay to "keep" a company in the state, or to lure other companies to desert their current states and relocate? Look at what happened in Illinois this year--the state raised the income tax from 3% to 5% and then paid virtually all of the increase to Sears Holdings and CME, Inc. to "keep" them in the state.<<
It is silly, isn't it? A giant shell game.
It seems to me that if a governmental entity has to offer incentives, at taxpayer expense, to keep a company in a location or to lure companies to that location, then said entity needs to make changes to its tax and/or regulatory climate. Companies locate where they are wanted, not where they are punished. Does that mean that governments must hand over the farm to the companies? Not at all, but they need to be hospitable to companies. Companies are far more willing to pull up and leave an area now than they were years ago.
Did Caterpillar make a decision about leaving Illinois? CAT was talking about it during that tax debate.
I think Navistar also received some incentives to stay in Illinois.
Startups typically don't have a half billion dollars in government money to lose. Solyndra's product wasn't intrinsically superior or they wouldn't have needed government investment--venture capitalists would have been shoving money into the company's pockets. The company's business model was sufficiently flawed that the DOE was going to turn down their application for less than a quarter of what they were eventually given, but then the White House "suggested" that it would not be wise for DOE to ashcan the request. That's blatant influence peddling on behalf of a major campaign contributor, in time-honored Illinois Democratic Machine fashion.
Fox spins everything. Even the most diehard republicans I know joke about it. But now I think fox is a little concerned about what they created. The latest primary was a circus that did more damage to their party than helped it. Clowns like Perry, Cain, Gingrich and Bachaman overshadowed anything positive or presidential romney may have presented. The party looked so bad that despite a terrible economy, obama's ratings are shooting up. Also misteps by Boehner, Ryan and Cantor did real damage. Their unpopular views can't even be supported with their typical propoganda anymore. Its no longer working. People see through the baloney. Next year fox is going to have to work extra hard spinning to get these guys elected.