Subsidy Tracker Reaches Major Milestones
Subsidy Tracker, the free subsidy database created in 2010 by Good Jobs First, has reached major milestones in its coverage of state, local, and federal subsidies.
This month’s enhancements to the database bring it to a once-unimaginable 500,000 individual incentive awards with a cumulative nominal subsidy value of $250 billion! That’s starting to add up to real money!
I explained two years ago how to use the data from Megadeals or Subsidy Tracker to compare a proposed economic development incentive package with past subsidies given in the same industry to get some idea whether the proposal represented a gross overpayment for a given investment. This method relies on finding good matches by industry, location, unemployment rate, and so on. The more deals available to search means your chances for finding good comparables improves proportionately. This can only enhance the ability of citizens’ groups, labor organizations, etc., to independently analyze proposed costly incentive packages.
As Philip Mattera, Good Jobs First Research Director, says, the steady expansion of Subsidy Tracker “reflects the improvement in government transparency over the past decade.” I can personally remember when the first statewide transparency law was passed in Minnesota in 1995; transparency has improved exponentially since then, although there is much progress that still needs to be made.
One notable recent innovation in Subsidy Tracker is a matching system to determine the ultimate corporate parent of subsidy recipients. According to Mattera, it now includes 2,606 parent companies, a threefold increase since 2014. This is critical information, given that so many companies hide their corporate connections through misleading names.
Although transparency remains an elusive goal, it’s worth celebrating successes when they occur. Cheers!
Cross-posted from Middle Class Political Economist.
Michigan has found itself in a budget shortfall . This comes after decreasing taxes for corporations.
In 2011, Snyder and the Republican House and Senate did this: ” 86 percent cut in the state’s corporate income tax ($1.7 billion), exempting nearly 100,000 businesses from paying any corporate income tax at all, combined with a two-thirds reduction in the state’s Earned Income Tax Credit (which goes to benefit low-income families). (Snyder originally wanted to eliminate the state’s EITC entirely.) As state Sen. Rebekah Warren (D) said, the plan represents a “significant tax shift” from business to those “who are the least among us.” http://thinkprogress.org/economy/2011/05/13/173952/michigan-tax-cuts/
Riding on the backs of the low income. Job growth in Michigan has been good; but, Michigan still ranks dead last amongst its regional neighbors in the numbers of its population in the Labor Force (Participation Rate). Michigan job growth can be attributed to the overall growth in the nation.
So what is the issue since Snyder has given corporations mega tax cuts on top of the rebates and assistance corporations have already received ($5 billion going back to Engler)? A budget deficit of ~$300 million. “lawmakers will need to make cuts to their 2017 spending plan to account for an unexpected $460-million budget hole, officials said after a revenue-estimating conference Tuesday.” http://www.livingstondaily.com/story/news/local/michigan/2016/05/17/state-lawmakers-face-budget-hole/84506548/
This comes on top of excess federal funding for Medicaid which were supposed to be squirreled way for future years and instead were paid out to cover the shortfall. Gov. Snyder’s answer was to blame prior administrations for the shortfall in 2016. It might have worked in 2012 or 2011 except Gov. Rick has been in office since 2011.
Yes, there’s been a lot of this going around lately. You may recall that Snyder made a big show of cutting some targeted business subsidies, but then swamped it with his overall business tax cuts. These results were entirely predictable.
They are going to cut Medicaid after they squandered the excess funding which was supposed to be stashed away for future years. They need $130 million to keep it on even keel. Waiting for someone to say something in Michigan. Then I will take out the Michigan Senate study.