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Usually ships in 1 business days | | | Almost every city and state in America has been slammed by a multilevel scandal, one that involves taxes, jobs, and corporate and political accountability. Under the guise of "economic development," big companies have gotten extraordinary tax breaks, from property tax abatements to land write-downs. Promises of job creation in exchange for these tax breaks have proven hollow, with companies continuing to downsize and outsource at record levels. Government officials are no help - they're well compensated major players in this troubling drama. This timely book explores these abuses in depth, but also offers hope with a series of commonsense reforms that would give taxpayers powerful new tools to reverse this situation - and redirect monies in ways that will really pay off. By popularizing these grassroots reforms - which are already taking hold - this book is taking a movement that is percolating in the states and putting it on the national stage. | | | |
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| | Product Details | | Author: | Greg LeRoy | | Hardcover: | 290 pages | | Publisher: | Berrett-Koehler Publishers | | Publication Date: | July 15, 2005 | | ISBN: | 1576753158 | | Package Length: | 9.3 inches | | Package Width: | 6.1 inches | | Package Height: | 1.1 inches | | Package Weight: | 1.3 pounds | | Average Customer Rating: |  based on 11 reviews |
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 Great impartial look at corporate extortion May 31, 2007
Starting in the 1980's with the election of Ronald Reagan, the balance between government and big business has slowly shifted back into the hands of the latter. This book examines two manifestation of this shift in power. First is the manipulation of tax codes at the behest of corporations in order to maximize corporate revenue, but which has the unintended affect of reducing taxpayer revenue. Second is the use of government subsidies to corporations. All of this is done under the guise of job creation, but it often ends up being a shuffling of jobs from one locale to another. The author of this book is a career grassroots leader who travels around educating labor groups, governments and NGO's on how to watch out for corporate lies and half-truths.
The book does a great job of examining the legal framework through which these schemes are done; things like free trade zones, tax rebates, tax credits, single-sales factor taxes, and a host of acronymns that only a lawyer could love. The book also cites numerous case studies from multiple states that show how giveaways to corporations often do not lead to job creation, or if they do, they create jobs at the lower end of the wage range. Guilty companies include Walmart, Costco and other big-box retailers; Home Depot, Sears and other specialty stores; Boeing, Motorola and other manufacturers. The author also cites numerous studies to prove his point, including many other books.
I think this is a great book, and should be read by all legislators and voters in America.
8 of 8 found the following review helpful:
 Good Material, but Too Long! Dec 19, 2005
LeRoy reports that job scams cost governments about $50 billion per year in lost revenues. The most common scams include:
1)Create a bogus competitor (another town or state) vs. wherever the company wanted to locate in the first place.
The intent is to create a "bidding war" over the freebies offered.
2)Job "blackmail" in which a company threatens to move (or locate elsewhere) unless it gets the subsidies/tax relief it wants.
Easily enhanced by overestimating the job increase - LeRoy cited examples from Connecticut in which only 9% of forecasted jobs materialized, leading to a cost of $367,910 per new job. Exaggerations are typically followed up by failure to track or publish actual results.
3)Entice a firm that pays "poverty" wages, and stick the taxpayers with hidden costs (eg. employee and family healthcare).
Wal-Mart is the most notable example.
4)Exaggerate "ripple effect" benefits - eg. the number of supplier jobs, and those created by employee spending.
(LeRoy cited an example where one city used a low multiplier to downplay jobs lost when a company left, and a high multiplier to play up the potential gain from another moving in.)
5)"Bust the union" in which the company uses Federal funding (eg.
CDBG grants from HUD) to move, and thereby break an existing union.
Obviously any and all these machinations can be combined.
Mayor Giuliani was cited as a prolific scam-"victim" - giving up $350 million in tax revenues between '94 - '01.
Small wonder N.Y. also ended up with a large deficit.
LeRoy points out that "nobody wants to be the mayor/governor who lost ______," and that fear impels leaders and legislatures to succomb.
In reality, however, taxes make up only 4-5% of location costs according to a consultant cited, and only 1.2% of total costs according to the IRS.
Similarly, convention centers are oversold (overall convention business is DECLINING - thus, new centers being built are extremely unlikely to be financially successful), and sports stadiums.
Meanwhile, LeRoy points out that a recent survey of civil engineers found that America's infrastructure needs greater funding. (My life as a truck-driver provides daily evidence of the substantial repairs and enhancements needed for our Interstates.)
The "bad news" with this book, like many others, is that to justify book printing, it ended up considerably longer than necessary - at least 2X, and probably 3X.
6 of 7 found the following review helpful:
 Greg LeRoy exposes the folly of these largely unproductive economic policies Sep 06, 2005
At one time or another, we have all been enticed by the prospect of a major retailer, manufacturer or financial services company building a new facility or relocating to our community. As the story goes lots of new jobs will be created and the tax base will be greatly expanded. But rarely are we given all of the facts. As concerned citizens and taxpayers we are at a huge disadvantage. What we are up against in a complex network of corporations, regulators, public officials and consultants. These people know precisely how the game is played and have perfected the routine over the past 50 or more years. The end game is to extract as many concessions from a community as possible. These folks know how to pit one community against another and how to carefully cover their tracks. They are extremely adept at keeping the general public in the dark about what is really happening. It is the ultimate shell game. But author Greg Leroy in on to them. He is been monitoring these issues for more than two decades now. He knows who the players are and where the bodies are buried.
"The Great American Jobs Scam" shines the light on just what has been going on and explains why huge taxpayer subsidies in the name of "job creation" rarely make sense. Essentially, our public officials have given away the store and the rest of us have precious little to show for it. Greg LeRoy cites example after example of these programs and giveaways. He explains what terms like SSF and TIF mean. He illustrates why subsidizing so called "big box" retailers like Wal-Mart, Target and Home Depot is very poor public policy. He explains how these and other major corporations are successfully evading taxes. And he points out that poor and middle class taxpayers are forced to make up the difference. This is an increasingly intolerable situation that needs to be addressed immediately.
"The Great American Jobs Scam" is an extremely thoughtful and well-documented book. We can simply no longer afford to pursue such innane and unsound policies. I will be donating my copy to the local public library in the hopes that many more will read it and begin to spread the word. Highly recommended!
2 of 19 found the following review helpful:
Absolutely True, It's the Way of the World Aug 04, 2005
I find this fascinating book, an expose on communities providing incentives to attract business, absolutely 100% correct, and also absolutely 100% immaterial.
Mr. LeRoy writes with a great deal of rage about communities giving tax breaks to businesses. Yup! Suppose I want to build a factory to supply something to Los Angeles and San Francisco. I could locate the factory in either of these cities, or I could put it in some smaller town inbetween, or perhaps even in Nevada or Arizona and balance the shipping costs vs. manufacturing cost (which includes the cost of the factory, the land it is on, the prevailing wage rates, the local tax structure, and everything else). If the factory is going to cost me $100 million and Nevada lets say will give me $300 million to move there, do I really have a choice? Should I not ask what incentives they will give me?
He seems angry at companies for playing off businesses. Businesses owe their stockholders to cut the best deal they can. During the presidential debates, the candidates all talked about bringing jobs back to the mid-west, especially Ohio. They never mentioned the cost. I guess it was supposed to happen like magic.
He's also right about the sports stadium. The Dallas Cowboys wanted a bigger, better stadium. Irving (where the stadium is located now) and Dallas, said no. Arlington said yes. There were protests. A bond issue was passed by the voters. My brother who lives in Irving is very happy, the game day traffic which totally plugged up the freeways will be moving to Arlington. The people in Arlington don't need to go anywhere on game days anyway.
Yes, Mr. LeRoy, this is the way it is. Thanks for letting us know. Don't let the rage get to you so badly that you have a heart attack. It works the same the world over, China will incent you to build a factory, so will England, Russia, or Arlington, Texas.
12 of 14 found the following review helpful:
Buy copies for your state legislators Jul 25, 2005
This is complicated stuff, but LeRoy walks you through it bit by bit in an entertaining way that builds both your understanding and your anger. Without a hint of cynicism, he systematically exposes $50 billion in job scamming and tells how to stop it. It's so clearly written and explained, even state legislators should be able to finally "get it."
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