When I first learned of the Foxconn proposal negotiated by President Trump and Gov. Scott Walker, I was hopeful like many in our state. Like all of us, I think bringing jobs to Wisconsin is a good thing. Unfortunately, as days passed and more details were revealed by our respected, non-partisan fiscal analysts, my hope turned to great concern. There is an incredible lack of guarantees or concrete information surrounding this arrangement. Prior to this deal, the largest state subsidy awarded was $65 million, which was to Wisconsin-grown Mercury Marine. The Foxconn deal will cost taxpayers $3 billion, which is almost 50 times more than the Mercury Marine deal. What happens to Wisconsin’s priorities when our budget must choose between this corporate payout and our schools, roads or citizens?
The Foxconn agreement locks Wisconsin taxpayers into a $3 billion cash payout over about 15 years, with no return-on-investment for 25 years even if the rosiest scenarios come through. The payouts to Foxconn are front-loaded, meaning we pay more in the beginning. In the 2019-21 budget, we will have to find $307.6 million in cash to give to a company with no ties to Wisconsin that will likely pay no state taxes in those same years. Where will we find the dollars that we’ve locked ourselves into paying over the next several budgets?
I understand that Governor Walker and Republicans don’t want to raise taxes, and they are already proposing more borrowing for our roads, so cuts in other areas will be the likely answer for them. Most of our budget is spent on education, health care and corrections, so my concern is that the cuts will come from health care for our most vulnerable and education for our kids – our future leaders and workers.
This rushed package of corporate giveaways includes loosening environmental regulations when we have not even been told exactly where the campus will be sited. This sets a terrible precedent for future deals. Also, with the unknown future of rapidly changing technology (what type of cell phone did you have 25 years ago?) Foxconn could decide to consolidate manufacturing in one of their many plants in other countries or just walk away after getting the goods from Wisconsin taxpayers. We’ve seen this happen before in this very competitive arena.
We are dead-last in the nation for business start-up activity, but we don’t have to be. We have seen that once a Wisconsin business gets going, we do better than most of the United States. This is why I’d like to see a fiscally reasonable jobs package that has more certainty, a better payoff for taxpayers and invests in our local entrepreneurs who have skin in the game and a commitment to our state.
My dad taught me that, when buying a car, you can fall in love with the color and style, but you also have to do your homework and investigate its performance and reliability. With Foxconn, Republicans in the Assembly have bought a sexy sports car without looking under the hood.