[CPEO-BIF] Subsidies

[Lenny Siegel]

I am not naive enough to believe that either developers or manufacturers 
make location decisions based solely on cost-benefit calculations. Often 
they seem to use proposed subsidies in one location to extract goodies 
from other communities - where they intend to invest, in any case.

Corporate location is as much a political process as an economic 
decision. Communities that wish to attract discretionary investment must 
recognize that the overall image of their local environment is as 
important as specific subsidies.

Back to my days writing about the semiconductor industry: I believed, 
and I continue to believe, that the Portland, Oregon metropolitan area 
attracted significant high-tech investments because it was perceived as 
a place that prized its natural environment. In turn, that helped 
companies attract the best and the brightest from a global job marketplace.

Lenny


Bruce-Sean Reshen wrote:
> As always Lenny, you were ahead of your time.  The concept is sound,
> though the mathematics become difficult.  Your concept assumes that
> developers are able to evaluate and quantify such public benefits and
> properly weigh them against the alternative of a direct subsidy which
> they better understand and appreciate. 
> 
> Bruce-Sean Reshen
> p. 203-259-1850
> c. 917-757-5925
> 
> -----Original Message-----
> From: brownfields-bounces at list.cpeo.org
> [mailto:brownfields-bounces at list.cpeo.org] On Behalf Of Lenny Siegel
> Sent: Wednesday, October 25, 2006 12:23 PM
> To: Brownfields Internet Forum
> Subject: [CPEO-BIF] Subsidies
> 
> Long before I ever heard the word Brownfields, I worked with community 
> groups around the Southwestern U.S. challenging the way that their local
> 
> government were offering subsidies to high-tech companies to locate in 
> their communities.
> 
> We argued that it is possible to attract investment by investing public 
> resources in education, infrastructure, housing, and even environmental 
> protection. Companies that have a choice where to locate need those 
> investments, not only because they directly benefit, but because they 
> need to recruit employees from a global workforce, and those potential 
> employees look at the qualify of life in areas where they might move.
> 
> While direct funding or tax abatement may indeed be useful, it should be
> 
> viewed within the context of a full range of public investments designed
> 
> to promote economic development. The advantage of spending money on 
> education, infrastructure, housing, and even environmental protection is
> 
> that it benefits existing residents, too.
> 
> Lenny
> 
> 


-- 
Lenny Siegel
Director, Center for Public Environmental Oversight
c/o PSC, 278-A Hope St., Mountain View, CA 94041
Voice: 650/961-8918 or 650/969-1545
Fax: 650/961-8918
http://www.cpeo.org