February 20, 2019. Senator Julia Salazar and Assemblymember Ron Kim were joined by Senator Michael Gianaris, the Fiscal Policy Institute, and community-based organizations as they introduced new legislation to end corporate welfare packages. The proposed bill would enact a collective agreement between all states that join, an interstate compact, to end the costly Race to the Bottom between different cities and states, which has cost many of them billions annually in taxpayers’ money for several decades. The legislation can be viewed here.
“When states compete against each other for jobs by seeing who can provide businesses the biggest pot of gold, there are no winners. The Fiscal Policy Institute applauds these Legislators for finally saying enough is enough. Study after study has shown that corporate subsidies are not effective and only create a never-ending race to the bottom. This can be evidenced by the recent subsidy fiasco where Amazon sought to create a secret bidding war for the location of their new headquarters in communities all across the country. In light of the recent 40% business tax cut the federal government just provided, now is the perfect time to stop providing these corporate handouts since we are already subsidizing these very same businesses through the federal tax code,” said Ron Deutsch, Executive Director of the Fiscal Policy Institute.
“The most important factors that attract business are good infrastructure and the abundance high quality talent.” said Jonas Shaende, Chief Economist at the Fiscal Policy Institute.