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Tuesday, November 16, 2010

Corporate welfare grows despite budget woes

Posted By on Tue, Nov 16, 2010 at 2:48 PM

Congrats to the two latest area beneficiaries of corporate welfare: SPX and Infocrossing Inc.

SPX, an industrial manufacturing company that’s already based in Charlotte, stands to collect more than $9 million, just for expanding its headquarters. Granted, SPX will provide 180 new jobs, but does this deal seem odd to anyone else? Let's consider what the non-corporate, “regular citizens” version of such a deal would be like. Let’s say your aging parents can’t take care of themselves anymore, and neither you nor they want them to go to a nursing home. So, you decide to expand your headquarters, i.e., your house, so Mom and Dad will have a comfortable, welcoming home. You’re strengthening “family values,” consolidating resources, and leaving two openings in a senior care facility somewhere for someone who wants to get in. In addition to helping solidify family ties and societal bonds, you’ll also be providing jobs, albeit temporarily, for the builders, carpenters, painters, electricians, plumbers, etc., etc. who will build the extra rooms onto your home. So, why shouldn’t you be able to apply for a state grant to help you with your “headquarters expansion”? Or, considering financial realities today, I’ll put it another way: why should SPX get $9 million to do something they would have done anyway (it’s hard to imagine SPX moving its headquarters over a state grant), while you can’t get, say, $100,000 for taking in your parents, plus giving builders some work?

The Infocrossing Inc. data center will situate near Kings Mountain (city motto: “Home of Cheap Labor!”), and will receive, according to Associated Press, “generous state tax breaks.” In return for those generous tax breaks, Infocrossing will provide a whopping 20 whole new jobs. And here’s another issue about Infocrossing, as well as Facebook, Apple and Google, all of which have moved to the N.C. Piedmont: One of the main reasons those businesses are being recruited to move here — again, according to AP — is “because the textile industry's collapse left behind a surplus of electric capacity.” Oh, really? A surplus of electric capacity? As BlueNC blogger Steve Harrison notes, what was the big rush, then, to get the Cliffside reactor up and running? Harrison has more to say about the deal, so check him out. Meanwhile, if you hear of a state program to help regular people “expand headquarters” in order to preserve family values, please let me know, and I'll pass the news along.

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