Hosting a Large Company: An Asset for Your Town or a Gun to its Head?

The laws of economic development have changed to the laws of economic survival in the last couple decades. The jubilation of the talking heads constantly reminding us of robust statistical growth rates for our economy are oblivious to a number of trends that render the growth almost entirely meaningless. At or near the top of that list of trends is the extent to which diminishing public resources are required to finance private enterprise's expansion. A systematic process of "socialized risk and privatized profit" that took hold in the equally "prosperous" 1980's has become the natural order to the business world and its surrogates, and sadly, also the public officials and pitchfork-wielding taxpayers on the receiving end of a method of extortion so sinister and methodical that it would make Tony Soprano grimace.

This cynical extortionary process has become so widespread that it's becoming less clear whether hosting a large corporation in your community or state is really gonna be a long-term asset. The corporations are certainly counting on us believing that they are indispensible. That's why they threaten financial ruin on our communities and citizens as a less-than-subtle "I hope you see things my way....or else" threat every time they stick their hands out for a routine greasing courtesy of the public nickel. Professional sports team owners eager to accommodate their wealthiest customers with luxurious box seats courtesy of lunch bucket-carrying taxpayers are obviously the highest-profile extortionists regularly threatening to despoil their host communities of economic vitality if their demands are not met, but these team owners far from monopolize the market on shameless blackmail. Whether it be the meatpacking barons at Iowa Beef Processors (now absorbed by Tyson) or the aircraft manufacturing firm Boeing, host cities are engaged in routine bidding wars to see which town will be allowed to survive and which town will be turned into a miniature Detroit based upon who first cries uncle and meets the demands of the supersized wolf huffing and puffing and blowing their houses down.

The latest high-profile casualty is Newton, Iowa, which has been pleading with and throwing fists full of cash at the Maytag Corporation for the past few years with the growing realization that the company was in a world of financial hurt and likely to be absorbed by Whirlpool. The merger with Whirlpool happened this past spring, and just three short months later, the bigger-is-better conglomerate said arriva derci to Newton.....and as a parting shot, informed the many levels of state and local government just waiting to shower Whirlpool with cash for the privilege of their continued presence that there was NO LEVEL of "benefit package" that could have been offered to keep the company in Iowa. Lovely.

The saddest part of this trend is that there isn't a rainbow in sight. With every round of economic despair that befalls communities of every size across the country, there's a pointy-headed economist or intellectual informing us all that this is the "tip of the iceberg", usually following up that prognosis with empty and obvious platitudes about "the end of the paternalistic corporation that felt a duty to its employees" and, all too often, restrained jubilation about the supremacy of lawless free enterprise smacking down its inferiors, which in the minds of many is entirely worth the costs of the trail of economic corpses left behind.

Making matters worse, the bumpkins repeatedly being hoodwinked by the increasingly entrenched robber baron interests respond by rewarding the very people bestowing ruination upon them every time they march like pre-programmed automatons to the polls and vote for the furthest right and most unapologetically "pro-business" candidate on the ballot. There are a number of reasons why the peasants can't seem to resist charging the castles to demand more power for the aristocracy, but it should be painfully obvious that the current system not only isn't working, but will drain the very public budgets most needed to stave off the effects of economic crisis. We've been worshipping at the altar of Mammon for decades now and the results have been devastating even for many of the alleged "winners" of the economic survival game. I think it's time the Bible-thumpers to take the good book's advice and cease and desist in worshipping the false God of money. Maybe then the real God will have mercy on towns like Newton, Iowa.....because Mammon sure doesn't.