Nov 14, 2018
Freedom Partners and AFP: Government Handouts Are the Wrong Approach
Post by Freedom Partners
Arlington, VA – Following reports of hundreds of millions of dollars in corporate handouts to Amazon, Americans for Prosperity and Freedom Partners Chamber of Commerce issued a joint statement highlighting the negative impact of corporate welfare.
Freedom Partners Chamber of Commerce Executive Vice President Nathan Nascimento and Americans for Prosperity Vice President Russ Latino released this statement:
“Americans are fed up with wasteful corporate welfare, yet cities and states are breaking the taxpayer bank to give carveouts to huge corporations. We need a level playing field where businesses can succeed by creating value for others – not a group of politicians cobbling together massive subsidy packages that almost never deliver the jobs they promise.
“It’s also worth noting that these precious tax dollars won’t be available to meet the needs of the community, like law enforcement or schools. Government ought to focus on serving the people rather than pursuing ‘economic development’ on the backs of taxpayers, especially in a tight labor market. A good business environment that benefits all companies – large and small – will have a far greater lasting impact on jobs and opportunity than an economy reliant on corporate welfare and taxpayer handouts.”
- Tax subsidies are a bad deal for taxpayers. History shows that the costs of these tax incentive packages rarely outweigh any of the perceived economic benefits corporations promise.
Cities should also work to improve their business climates by reforming their tax codes to be simpler, fairer, and more efficient in ways that will strengthen local economies.
- “Instead of offering the average $2.15 billion over 15 years, semi-finalist cities could, on average, increase its police force by 56%, or educated 8,000 public K-12 students each year.” Source: Amazon HQ2 is the Only Competition Where the Losers are Winners, Michael Farren and Anne Philpot, Study of American Capitalism, Nov 13, 2018.
- “Similarly, it is hard to accurately identify how much economic activity was brought to an area because of a targeted tax break. Tax policy is important to businesses, but often businesses receive economic incentives for activities they would have undertaken regardless. In other words, targeted tax breaks drain government budgets, require higher tax burdens on other individuals and competing businesses, and create an unequal playing field as established businesses are forced to compete against a newly subsidized competitor.” Source: Trading Tax Breaks For Amazon’s New HQ Is Just Another Form Of Corporate Welfare, Andrew Wilford, The Federalist, Nov. 8, 2017.