Comments on: Local Subsidies for Business Relocation http://www.coyoteblog.com/coyote_blog/2005/01/local_subsidies.html Dispatches from a Small Business Sun, 12 Feb 2012 09:39:47 +0000 hourly 1 http://wordpress.org/?v=3.2.1 By: Max Lybbert http://www.coyoteblog.com/coyote_blog/2005/01/local_subsidies.html/comment-page-1#comment-446 Max Lybbert Thu, 06 Jan 2005 03:00:01 +0000 http://coyote-blog.com/wordpress/2005/01/local_subsidies.html#comment-446 <p>I've gone back and forth on this one as well. Currently, however, I believe tax breaks are often used in an effort to make bad business decisions look like good ones, with very predictable results.</p> <p>I once worked for a manufacturing company that sent its partially-finished product to a plant in New York. Eventually New York's high cost of doing business caused the company to look at more business-friendly places, and New York offered some tax breaks to keep the company. I was surprised when the company decided to move operations to Georgia even though New York offered millions in tax incentives. The more I think about it, however, if NY was a bad place for the business, it would probably still be a bad place even if NY State promised to take less money out of the company's bank account.</p> I’ve gone back and forth on this one as well. Currently, however, I believe tax breaks are often used in an effort to make bad business decisions look like good ones, with very predictable results.

I once worked for a manufacturing company that sent its partially-finished product to a plant in New York. Eventually New York’s high cost of doing business caused the company to look at more business-friendly places, and New York offered some tax breaks to keep the company. I was surprised when the company decided to move operations to Georgia even though New York offered millions in tax incentives. The more I think about it, however, if NY was a bad place for the business, it would probably still be a bad place even if NY State promised to take less money out of the company’s bank account.

]]> By: Bill http://www.coyoteblog.com/coyote_blog/2005/01/local_subsidies.html/comment-page-1#comment-445 Bill Wed, 05 Jan 2005 15:22:59 +0000 http://coyote-blog.com/wordpress/2005/01/local_subsidies.html#comment-445 <p>Interesting goose vs. gander argument concerning state regulation, but you miss the distinction between the taxing power and the police power. The federal courts have accepted some commerce clause arguments that limit the states' police power (e.g., state regulations limiting the length of tractor-trailers), but as a general matter, the balancing of commerce clause vs. police power has tended to give greater weight to the police power than a similar balancing of commerce clause vs. taxing power has given to the taxing power.<br /> There are no absolutes in constitutional law, just balances.</p> Interesting goose vs. gander argument concerning state regulation, but you miss the distinction between the taxing power and the police power. The federal courts have accepted some commerce clause arguments that limit the states’ police power (e.g., state regulations limiting the length of tractor-trailers), but as a general matter, the balancing of commerce clause vs. police power has tended to give greater weight to the police power than a similar balancing of commerce clause vs. taxing power has given to the taxing power.
There are no absolutes in constitutional law, just balances.

]]>