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Wisconsin has to make this risky bet PDF Print E-mail
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Written by Ozaukee Press   
Wednesday, 09 August 2017 17:28

The governor and a coterie of state officials are on their way to the Potawatami Casino craps table to place a $3 billion bet with taxpayers’ money.
    That’s not literally true, but casino gambling is an apt metaphor for the enormous bet the state government is placing on Foxconn Electronics.
    The bet is indeed for $3 billion and the money is coming from Wisconsin taxpayers. Citizens are putting it up in the form of tax exemptions for the company and payoffs in cash directly from their pockets. The odds of winning may be better than craps, but the bet is still risky.
    Nonetheless, this bet should be made. Wisconsin has to roll the dice.
    It has to precisely because the stakes are so high. As they say about big-bucks lotteries, you can’t win if you don’t buy a ticket. The state is buying a ticket because the payoff if Foxconn keeps its promise to build a mega manufacturing facility in southeast Wisconsin is expected to be tens of thousands of jobs at Foxconn and businesses that will grow to support the Chinese electronics maker.
    The stakes aren’t just economic; they’re cultural as well. Wisconsin is a long-suffering casualty of the rust-belt wars, its economy and its society depleted by the wholesale loss of manufacturing jobs. You can see the battle scars in Port Washington in the acres of abandoned manufacturing plants.
    The loss of these jobs was more than an economic blow. It was also a blow to the esteem of workers for whom skilled blue-collar employment was a marker of success that meant home ownership, college educations for their children and status as contributing members of their communities.
    The Foxconn initiative can help restore the vitality of blue-collar employment by providing jobs making not widgets that rust, but liquid crystal display panels for computers and TVs, with the high-tech training that goes with them. Other electronics companies could well follow.
    The bet is worth making, but state senators and representatives who are being asked to pass legislation enabling the Foxconn deal better be going into it with their eyes open. First, they need to assume that the payoff has been exaggerated.
    That’s a safe assumption because it was announced in Washington with unrestrained hyperbole by the exaggerator in chief, President Donald Trump, and  Gov. Scott Walker, a re-election candidate desperate for a bragging right after falling far short of his job-creation campaign promises, and by Foxconn’s CEO, who was motivated to make extravagant promises to drive up state incentives.
    Still, even if only a significant part of what has been ballyhooed—13,000 Foxconn jobs with an annual payroll of $700 million, 22,000 more jobs at supporting companies, 10,000 construction jobs for four years building a plant three times the size of the Pentagon—comes to pass, it could be worth the gifts the state is offering.
    Legislators need to understand, however, that  realizing the potential benefits is not as easy as simply giving away money. The Foxconn initiative adds new urgency to the state government’s stumbling attempts to fund road building and maintenance. Imagine the transportation needs  of a manufacturing campus that will cover more than a square mile of land somewhere near Kenosha and Racine.
    The deal also should push legislators to reverse their shortsighted effort to progressively squeeze state funding for the University of Wisconsin System. UW campuses are going to need resources to turn out more mechanical, industrial and electrical engineers to meet the needs of Foxconn and other high-tech manufacturers.
    And most important, the Legislature must not cave on environmental protection standards. Already there is talk from the governor’s office of exempting Foxconn from providing environmental impact statements and relaxing other regulations that protect the state’s water, air and land. These resources should not be on the bargaining table. A gift of $3 billion is enough. Giving away some of the health of the state’s environment is too much.
    However it goes, Wisconsin’s Foxconn bet will be risky, but state elected officials need to work to improve the odds.
    Then roll the dice.

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