posted November 6, 2009
Today, the right side of the Times Free Press editorial complains about congressional stimulus spending, and the taxpayer investment of about $92,000 for each stimulus job created. I note with interest the intellectuals are not complaining about our local taxpayer investment and the cost of job creation at VW. There is absolutely no difference.
It seems that the TFP opposes stimulus spending in the name of job creation citing $92,000 taxpayer investment per job. This is reasonable objection in taxpayer spending, because obviously cost/benefit analysis has not occurred.
A taxpayer capital investment of $92,000 per stimulus job does not represent a reasonable rate of return for the public, Joe Taxpayer. The notion of shoveling taxpayer money to private companies, and keeping our fingers crossed in hopes of trickle down seems very high risk for the taxpayer, through the eyes of regular people.
I just wish the same principals or math would be applied to the over the top local tax exemptions for VW. I am glad VW is in Chattanooga. However, existing industries and businesses should not have subsidize this private business to the tune of 30 years of tax and fee exemptions.
The Memorandum of Understanding that allocates local taxpayer capital investment into a private company has been marketed in the name of "regional" job creation of approximately 2,000. The local Chattanooga taxpayers reward the Chamber for their hard work recruiting VW to the tune of about $475,000 annually from the city of Chattanooga tax funds alone. It appears existing industry and business would be more accepting of subsidizing all of VW in the tax base for 30 years, if the cost/benefit or rate of return for the taxpayer was understood.
A rough non economic professional glance indicates that $40 million in guaranteed bond issues and capital projects from local jurisdictions, funding from the state of Tennessee, and annual taxpayer funding of $475,000 to the Chamber and many other entities in the name of VW, divided by the number of jobs, result in job creation costs of $49,000 to $62,000 per job for taxpayer investment. This does not count 30 years of tax base exemptions that is being subsidized by existing industry and businesses.
I honestly do not understand how the local taxpayer investment directly from existing industry and businesses will have a reasonable rate of return to the community, if they do not Hire Here.
April Eidson
E3.sciences@comcast.net
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Time and space do not permit me to address all the conclusions to present in your case against taxpayer funds for your union funded "Hire Here" program.
The bottom line is this:
We the people want jobs. Our elected officials and those paid to bring jobs to this area listened and did just that. Your analysis and fuzzy math does not address the thousands of new jobs that the mere two thousand will bring. You don't mention all the ground leveling going on now in a five mile radius around the VW site. Building sites are being sold every day and will continue up to the time that first car rolls out the door and beyond.
The amount of taxes we lose to VW is miniscule compared to the overall economic and industrial growth we will see in the near future. I would surmise that we are possibly the only city in the U.S. that has private sector growth at the rate we have at this dire time in the economy.
These are real jobs, not government contracts or 501c non profits. This is capitalism at its finest.
The one thing I agree with you about is the hope that VW will hire as many people from Hamilton Co. as possible. They have committed to giving locals priority for the production jobs. This does not mean they will hire unskilled, unschooled and undisciplined applicants. Quite the contrary. The most qualified gets the job. This is business, not government.
Remember, this is a very competitive business that must make a product that the public will buy. Otherwise, they will be out of business. Also, if you are an applicant, you will be completing against thousands of ex-auto workers laid off from the big three up north who would love to get out of those dying cities and brutal winters. They will have experience over you, so remember this if you are rejected.
You see how the unions demands out priced the American auto manufactures to the point of unable to be competitive. Don't let it happen here.
Bill Watkins
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