Tuesday, February 13, 2007

Readers let us have it on Google

Readers respond to Sunday's column about Google.

From a conservative Republican in Cabarrus County:
A great article. I agree with you 100%. Let me give an incident here in Cabarrus.
Around 2000, billionaire John Q. Hammons came into town, and a secret meeting was called by the Concord City Council and Cabarrus County Commissioners. Hammons made a proposal that he would build an Embassy Suite Hotel if the county would build a convention center as a part of the hotel. He would manage the convention center.
Then County Manager Frank Clifton along with pressure from the city tried to get the county to do this. By a 3 to 2 margin, the commissioners refused, saying if the hotel was a profitable venture for Hammons, he would build the convention center himself.
About a year later, Commissioner Bob Carruth came up with the idea to increase the hotel/motel tax and give the increase to Hammons to build the convention center.
Three of us said that it is unfair to have Hammons’ competitors to collect a tax to give to Hammons to build a convention center. After much pressure from the chamber of commerce, etc., the board said NO.
Then, John Q. said, “Since I can’t get public money for this project, I will pay for it myself.” Last month the hotel and convention center opened without public money. Local government officials are easily swayed by these “powerful” interests and their tactics. If it is a profitable venture, they will do it anyway.

From a Mecklenburg County contractor and developer:
I can appreciate your feelings in your article that the taxpayers will pick up the loss of the tax revenue that has been forgone by giving firms like Google these breaks on their taxes. But I wish you would go do the research that has been done showing that the benefits of a project like the Mercedes one in Alabama that show the overall growth in tax revenue far exceeded the breaks given the firm. The $300 millionpackage given to Mercedes which is still considered the largest package in U.S. history has been recouped several times over, based on the growth in the economy and state income tax paid by those people in those higher paying jobs that have been generated...
I hope you won’t take offense at this statement, but it is unfortunate that the Observer is such a liberal, do anything to sell papers to the masses publication that the overall bent of its articles is so anti-business that an article like yours will be accepted by the majority of readers as being the facts. In reality your article is just plain wrong based on the facts. Yes, there are the liberal think tanks or the ultra-conservtive ones that are against any kind of government subsidy, that are against these deals, but the facts don’t support their or your position on this issue.

From a Charlotte project manager:
Just read your article from Sunday’s paper and gained little or nothing from it other than your opinion that the deal was unwise. The reportage on this subject seems to imply that a check was written to Google for the full amount of the incentive or that otherwise due tax dollars that were forgiven. Neither is true.
This is either a justifiable business decision or not. Your article supports neither case.
An unbiased evaluation of this requires that we know the current income of the property in question (from public tax records). The amount of capital investment (for roads and infrastructure) can either be dug up by a good reporter or estimated by someone in the building and development business.
If the return (expected less current tax revenue) is handsome, you should explain why it is still a bad idea. If the return is abysmal, it will support what you have already written.

Excerpted from a response from a citizen in Lenoir:
Depend on the Observer to get worked up over the wrong thing.
The real and unreported scam – an enormous burden on taxpayers past, present and future – is the hideously ineffectual government schooling monopoly.

From a Charlotte reader:
A few things you didn’t mention in your otherwise excellent Google story:
Google’s competition will continue to pay real estate taxes resulting in a very uneven playing field, and the 200 odd jobs “generated” will be filled by NC outsiders and not by those laid off from the local textile industry.

From a reader who describes herself as "a Charlotte patriot":
Tommy and Jack, it is interesting to note your facts on the Google deal are headed by – IN MY OPINION....The arena deal for a billionaire set a precedent, making one-sided deals a common occurrence in our Orwellian new world. Word spreads on states and cities where suckers will buy snake oil!
As taxes in NC are the highest is the Southeast, with mounting crime, and poor performance of public schools – businesses must be lured with incentives and subsidies. The granddaddy of all deals is the gouging of the light rail scam!

From a book dealer in Hickory:
Caldwell has profound problems. For a hundred years there have been enough jobs in the area to keep expectations low. Now there is a brighter light being shown on the low-powered educational situation. Fully 90% of the ordinary high school GRADUATES seem to come out of the schools saying: “He don’t” and “They was.” “Ain’t” is absolutely commonplace. It is almost shocking.
Google is not going to hire these people. If anyone does a study on their employees in two or three years, they will see that the good jobs go to outsiders – who may come from Cary, but they will be outsiders. The construction jobs will be over by that time....
I am grateful that you made the situation in Caldwell County the subject of your column – and Tommy Tomlinson, too. The leadership needs scrutiny there, and they seemed to have had precious little. I just hope that the Observer will follow up and check in two or three years to assess the situation at that time. I’m willing to bet that it won’t be rosy.


Anonymous said...

In conversation with someone from the Charlotte Chamber, it was pointed out to me how bringing in new companies, such as Google, gloss over the failure of our public school system. In hiring out of area employees, the locals are left with support positions, which are better than nothing.

While I don't care for subidies, on the basis they improve the bottom line of some companies relative to others, new jobs will be created. Houses will be built for the newcomers, in addition to the business building. Other support functions will increase.

What is always left out of these discussions is the fact businesses don't actually pay taxes to start with. If they can't pass them on in the price of their product, who is ultimately the individual consumer, they will go out of business. What happens with subsidies for one company compared to another in this situation is: their operational costs are lowered allowing them to lower their prices in the market becoming more attractive to consumers thus increasing their market share, while their competition struggles.

If North Carolina and the counties of NC would accept this fact and stop taxing businesses at all, no other subsidies would be needed, as businesses would flock here.

Unfortunately there is a mindset which believes taxes on businesses are taxes individuals don't pay, and using emotional laden arguments fight to continue the hidden tax burden, pretending it is an equalizing issue.

Anonymous said...

While most people make good points. NC doesn't receive tax revenue from Google not being here so why does it matter if they get a tax break now? Put in more simpler terms:

Google not paying taxes = NC receiving the same amount of tax revenue it currently receives.

Google paying any taxes = NC reveiving MORE tax revenue than in currently receives.

Unless I'm missing something, having them pay anything in taxes is still better than nothing. How can anyone know all the jobs will be taken by outsiders? If Google moves here it might give locals some incentive to go to school so they can work for them? So what if Google hasn't been around as long as other businesses. Textile factories would probably move even without the tax breaks. It seems when people complain about tax breaks in this paper they fail to mention anything about the benefit in the long term.

IN MY OPINION, The Observer's staff writes too many opinion pieces. I don't want to hear your opinion, I want to hear facts about the news. I can form my own opinions. What ever happened to well researched factual articles? Half the time I feel like I'm reading a gossip column.

Anonymous said...

I don't get how it was a bad deal at all. The land was sitting there generating little revenue for the state. Google comes in, gets a break, and brings 200 high paying jobs with it. Those people come in and generate income tax revenue, property tax revenue, as well as sales tax revenue on their purchases. Furthermore, since Google is here that attracts more high tech businesses to NC generating further revenue.

As to the furniture and textile workers, they need to take initiative to educate themselves to find other jobs. Not that I'm unsympathetic but a simple fact of life today is that those kinds of jobs are outsourced to where it is cheaper or are further automated to reduce costs. At some point it becomes their responsibility to manage their careers.

It sounds like a good deal for the area to me.

Anonymous said...

As a native of Caldwell County, I am jumping for joy that Google has chosen Lenoir for it's data center. Let's be honest, it can't get much worse than it already is. Every time I go home all I hear is negative comments, thoughts, etc.... This is a beautiful part of our state that needs new industry in order to grow. Change is hard, but inevitable. It's time for our leaders and residents to deal with this new change and make the best of it. The sooner that everyone realizes that the furniture factories are not coming back, the better.

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