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TROY DEMOCRATIC CLUB
TDC NEWSLETTER
January 2010
What’s Inside?
COMING EVENTS................................................................................2
• TUESDAY, JANUARY 12, 7 P.M., TROY LEADERSHIP COALITION PUBLIC FORUM ON
2/23/10 SPECIAL MILLAGE ELECTION
• TDC EXECUTIVE BOARD MEETING, WEDNESDAY, JANUARY 13 AT 7:00 PM
• TDC GENERAL MEETING WEDNESDAY JANUARY 20TH AT 7:00 PM, TCC RM 305,
CONCERNING FEBRUARY 23 ELECTION, WITH OFFICIAL VOTE OF MEMBERSHIP ON TDC
POSITION
RECAP OF PAST EVENTS.......................................................................2
MEMBERSHIP: Welcome New and Renewing Members!
• CAMPAIGN REPORT: Looking to 2010
• CHAIR’S SUMMARY OF 2009
• TROY ACTION NET MESSAGE
NEWS FROM OTHER DEMOCRATIC AND ALLIED GROUPS.....................................5
CONGRESSMAN GARY PETERS
•
9 DISTRICT DEMOCRATIC PARTY
• TH
TIM BURNS: COUNTY COMMISSIONER
•
• MICHIGAN DEMOCRATIC PARTY
MICHIGAN DEMOCRATIC FUTURE—SAT JAN 10 YOUNG DEMS RETREAT
•
EDITORIALS.......................................... .........................................8
1. WHO NEEDS ACCURACY? TROY DOES!
SO WHY IS Ms DANIELS SO INACCURATE?
2. MYOPIA IS NOT FORESIGHT, or WHAT’S IN A NAME?
3. BEWARE OF GREEKS BEARING GIFTS\
4. Are Today’s HiTech Green Jobs in China and Europe & Not in the USA?
Put together by volunteer labor working at home in our “spare” time
Current Events
Tuesday, January 12, 7 p.m., Troy Leadership Coalition Public Forum on 2/23/10
Special Millage Election
Open forum on the proposed 1.9 Mill increase vote on February 23, 2010 at Walsh College,
3838 Livernois Road. Troy 48083. Please plan to arrive early to ensure your participation. It will
be taped by CMN TV for cable broadcast. More details forthcoming.
TDC EXECUTIVE BOARD MEETING, WEDNESDAYJANUARY 13 AT 7:00 PM
The Troy Dems Executive Board will meet from 7:00 to 9:00 p.m., Wednesday, January 13, at
ViceChair Kathy Martin’s house (707 Kimberly, Troy 48098). All Troy Dems members are
welcome to attend to help plan the Club’s 2010 activities.
TDC GENERAL MEETING WEDNESDAY JANUARY 20TH AT 7:00 PM, TCC RM 305, CONCERNING
FEBRUARY 23 ELECTION
Most of the meeting will cover the Millage election vote. It is important for the Membership to
have information so we plan to have several guests. There will be a vote on an Official
Club position. In order to vote, you must have been a member by December 20, 2009.
See Editorials #1 and #2 for more on the issues in the Election. If you need another copy of the
Informational Brochure that was mailed out by the City, see http://www.troymi.gov/2010Proposal/
Meeting at 79 PM
Troy Community Center, Room 305
3179 Livernois Rd, Troy 48083
(north of Big Beaver/16 Mile,
east of I75)
TDC COMMITTEE REPORTS
Membership Committee
Welcome, New and Renewing Members
New members’—Jason Bauer, Jennifer Suidan, Doris Gaddis and Mike Pihaylic
Renewing members—Sandy, Roy and Mary Burgess, Mahendra Kenkre, Marilyn
Thomas and Hagen Gottfried
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If you have any questions on membership, please contact Kimberly McFall at
membership@troydemocrats.org
Campaign Committee
Now that it is 2010, the Campaign Committee is providing a list of our
next opportunities for victories
TROY AND CLAWSON
Reelect Tim Burns, County Commissioner District 19 (Troy and Clawson)
Reelect Gary McGillivray, County Commissioner District 24 (Troy and Madison Heights)
Elect Ed Spillers as Michigan State Representative for Troy and Clawson, 41st District
Elect More Precinct Delegates
9TH DISTRICT
Reelect Congressman Gary Peters
STATEWIDE
Elect Democratic Governor, Secretary of State and Attorney General
Defeat State Senator John Pappageorge
Defeat Supreme Court Justice Bob Young
Elect more Democratic State Senators so Democrats can hold both legislative houses
Hold onto Democratic Party positions on State Boards of Education
OAKLAND COUNTY
Oakland Community College Board of Trustees—3 positions up for election in 2010
Several Surrounding Community Local School District Board Members
RECAP OF PAST EVENTS:
Remarks by Harry Philo, Chair TDC at TDC Holiday Party
2009 was pretty interesting. We were concerned with themes of Neighbors Working Together,
Regionalism, and Building our Community throughout the Year.
4
We continued the trends started with the previous administration of Community Service,
including donating items to wounded Veterans, and helping with Bowling for Rhinos, Habitat
for Humanity, Gleaners Food Bank, River Rescue, Big Brothers Big Sisters, Salvation Army
and Lighthouse of Oakland County. This helps increase visibility and positive impact of Club.
We had a large number of interesting speakers, including Marie Donigan, Detroit Mayor Ken
Cockrel, Andy Levin, Andy Meisner, Glenn Anderson, John Freeman, Mike Whitty, Jocelyn
Benson, Mark Brewer, John Szerlag, Dr. Barbara Fowler and Alma Wheeler Smith. We
participated in a joint program with the BirminghamBloomfield Club.
We had a successful picnic. We helped out County Commissioner Tim Burns in his
Community Cleanup.
TDC members and friends spoke out against privatization of elements of the Troy School
system. We spoke out in favor of City services, including the Library and the Community
Center.
Members of the Club were involved in the leadership of OCDP, including the Platform &
Advocacy Committee, and the 9th District, and we had a great showing at the Obama Birthday
bash.
The Club participated as a part of the Troy Leadership Coalition in the Troy City Council
Candidates Forum. We supported the strong leaders who want to preserve our essential City
Services and our Quality of Life
Troy was right in the middle of the Health Care debates, including providing balanced views at
several TEA parties, Marty Knollenberg, Pappageorge, Gary Peters and other forums.
We've been very lucky to have an active Executive Board:
Thanks to Kathy Martin’s leadership, we had a very positive presence at Troy Daze. She and
Tim opened up their house again for us in October for a City Council candidate Meet and
Greet. Her skills in organizing Events were important to the success of the Club.
Cathy Fucinari participated in the Citizens Academy, which gave her a chance to reach
potential voters about the importance of the City Services they were viewing. She also took
over temporarily as Club Treasurer while Will was campaigning. She also hosted
Congressman Peters at her house in May.
Ken Zook gave us a better way of distributing our newsletter and Campaign Connections. He
updated the website and helped members of the Club stay informed.
Our Membership Chair, Kim McFall is following in the footsteps of the previous chair Kathy
Martin. She is cleaning up our lists and looking for ways the Club can increase donations.
Bob Arking continued to push the Club with his great writing.
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Gloria Inglehart provided Strategy and Tactics and an excellent historical view
Ed Spillers helped with ideas for speakers and by increasing the Club’s participation in
Community Events. He also was heavily involved in the campaign for Regional Transportation,
starting in February and continuing throughout the year.
Terry Merriweather took over the Campaign Committee and after a lot of lit packages, drawing
maps, and canvassing, helped get new leadership to the City. This was the first time all 31
precincts were covered. I know what a challenge it is dealing with the shortage of literature as
you are trying to reach more potential voters. He and Nancy let the Club use their house as a
Clubhouse, and we appreciate it.
Will Molnar ran hard for a City Council position while serving as Club Treasurer. He and
Marilyn covered a lot of Precincts helping convince the voters of Troy to support the City. It is
significant that he received the most votes for a Democratic candidate in the City Council
race.
Message from Troy Action Net blog
6
We share with you a message which Zachary David Kilgore sent to the members
of Save the Library! (Troy, MI).
Subject: Where We Are Now
Troy has a major budget crisis. Over the next five years, the city could suffer a loss of
revenue of $10.5 million. To make up for this, the city plans to close the library, nature
center, museum, and community center. They will also cut services like 24hour snow
removal, and even go as far as to lay off firefighters and 50 policemen.
But we now have a solution.
After a series of City Council meetings, it has been decided that the city will hold an
election on February 23, 2010 for a millage proposal. If passed, city council will be able
to levy an additional 1.9 mills for the next five years. This will save the library,
community center, nature center, and museum, while also saving the policemen and
firefighters' jobs.
I have created a blog in order to keep everyone updated on the issue without sending
these messages. You can find it here:
http://www.facebook.com/l/9e7e8;troyactionnet.blogspot.com/
I also encourage everyone to become a fan of Vote YES on the Troy Millage Proposal. If
you become a fan, you will get short, important updates in your news feed. You can find
the fan page here: http://www.facebook.com/pages/VoteYESontheTroyMillage
Proposal/220117719779
Thank you everyone for your support!
Zach Kilgore
NEWS FROM OTHER DEMOCRATIC AND ALLIED GROUPS
Congressman Gary Peters
Our holiday wishes this year:
May those of us who are lucky enough to be with our families think of and provide comfort for
those who cannotespecially our men and women in uniform serving our country abroad.
May those of us who are lucky enough to enjoy a holiday feast this year remember those who
are hungryespecially as many area food pantries are facing an increase in demand and a
reduction in resources in the midst of the tough economy.
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May the end of 2009 offer us all a time of restful reflection on the previous year, and may we
all emerge from this holiday season with more resolve than ever to rise above the challenges
facing us personally, facing Michigan and facing our country.
Colleen and I thank you from the bottom of our hearts for all of your support this year. We
have accomplished so much together. May you and yours have a wonderful holiday and a
fantastic 2010.
Sincerely,
Gary and Colleen
Gary’s district office is in Troy at 560 Kirts Boulevard, #105. Please contact him
via that office if you have issues and concerns that he might help you with.
Phone: (248) 2734227 Fax: (248) 2734704. Our own Kevin Hrit is on the staff at
this office.
9th District Democratic Party:
We are Proud of Congressman Peters' Service
We have been very fortunate to have a congressman who shares our values working for us.
Congressman Peters has been fighting to save Michigan jobs and to advance progressive
legislation that will protect middleclass Americans.
Less than six months after taking office, Congressman Peters led the successful effort to keep
the Orion Township General Motors plant open by persuading GM to build its new small car at
the facility.
Congressman Peters introduced the Advanced Vehicle Technology Act, which will provide over
$500 million in annual federal funding for vehicle research and development. The bill was
supported by a broad, bipartisan coalition of businesses, labor groups, and environmental
organizations, and it passed by the House of Representatives by a wide margin. Once the bill is
passed by the Senate, it will provide huge benefits to Oakland County by supporting highpaid
jobs in what continues to be the world capital of automotive research.
Congressman Peters cast a courageous and principled vote in favor of the health care reform
bill in order to dramatically expand health insurance coverage, curtail the system's outof
control costs, and reduce the federal budget deficit. As a member of the House Financial
Services Committee, Congressman Peters is actively involved in crafting legislation to
protect investors and consumers of financial services and to prevent a future recurrence of the
banking meltdown that we witnessed a year ago. In pursuit of this goal, Congressman Peters
recently led a forum on the topic in Oakland County with congresspeople from around the
country.
Join Us on Facebook
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In order to keep up with all of you young hipsters, the 9th District Party is now on Facebook!
Please join us: the name of our group is 9th Congressional District Democrats (MI).
Keep in Touch with the 9th District Democratic Party
Our website is http://www.9thdistrictdems.org/. Please feel free to call or email me anytime
with any questions, concerns, or suggestions.
Best Regards,
Tim Greimel, Chair, 9th District Democratic Party, (248) 425-7525
Tim Burns: County Commissioner
Tim Burns has kicked off his 2010 reelection campaign to retain his seat on the
Oakland County Board of Commissioners. I truly need your support so I can
continue to be a practical voice of reason for the residents of Oakland County
This has been a year full of economic uncertainty for all of us and difficult decisions for those
of us serving as Oakland County Commissioners. I have been working hard to bring about the
results that we need to keep our economy moving forward and to also preserve the essential
services required to maintain a high quality of life and security for our residents. In a period of
diminished property values and high unemployment, now more than ever it is important to
have responsible leadership representing us. For more information regarding my work
as County Commissioner, please visit my website: www.timothyburns.org.
FRIEND TIM BURNS ON FACEBOOK
Stay connected with Oakland County Commissioner Tim Burns by becoming a facebook
friend. Visit him at www.facebook.com/TimBurns.
What is a County Commissioner? Oakland County Commissioners are the legislature for
county government. County Commissioners oversee a budget of nearly $1 billion dollars and
serve as a liaison between Oakland County government and local communities
TIM BURNS
COUNTY COMMISSIONER
19TH DISTRICT [Clawson and Troy]
www.timothyburns.org
Michigan Democratic Party
Seasons Greetings Fellow Democrat,
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As 2009 draws to a close, we think back to all that was accomplished this year to prepare
Michigan Democrats for the challenges we face in the 2010 elections.
Michigan Democrats did very well in municipal elections all across the state 65% of
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Democratic Mayoral and City Council candidates backed by the Michigan Democratic
Party won their races.
The Michigan Democratic Party launched MDP 2.0, a program that no other state party
•
has, designed to give Democrats in all districts, counties, caucuses and clubs the
website and email tools they need to successfully organize online.
The Michigan Democratic Party went on the road to train and prepare nearly 300 district,
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county, club and caucus leaders in 12 different locations above and below the Bridge.
The 2010 elections are quickly approaching. Now more than ever your support is critical to
ensure that we have the resources to fight for victories up and down the ballot
Michigan Democratic Future
Sunday, January 10, Dems of all ages invited to Young Dems of Michigan Retreat/Training
You are invited to a statewide Young Dems of Michigan retreat on Sunday, January 10, Noon
to 5 p.m., at Quality Inn & Suites—Livonia (Next to LA Fitness), 30375 Plymouth Road, Livonia
48150
Workshops will include: Chapter Building, High School Organizing, 2010 Young Voter
Program, Targeted Races
Please RSVP to Isaac Robinson at isaacrobinson313@gmail.com
EDITORIALS:
EDITORIAL 1: WHO NEEDS ACCURACY? TROY DOES!
SO WHY IS Ms DANIELS SO INACCURATE?
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Janice Daniels and her group, Troy Citizens United, are opposed to approving the temporary
millage proposed by City Council, as witnessed by her recent opinion piece in the
Oakland Press for 29 Dec, and in her formal complaint that the City, the Mayor, and three
City Council members had used city funds to print a brochure that she felt would scare
the citizens into voting for the proposed millage. Her complaint was turned down by the
State for lack of evidence. In my opinion, she misread the brochure as well as the city
and county financial data on which the brochure is based.
I believe that Ms Daniels and other members of Troy Citizens United are sincere in their
opposition. And I think their opposition is based on their sincerely held principle that
taxes should be held to the minimum amount necessary (“The power to tax involves the
power to destroy”, John Marshall, 1819). But I think they are so focused on the potential
harm that taxes might entail that they lose sight of another sincerely held principle
(“Taxes are what we pay for civilized society” Oliver Wendell Holmes, Jr., 1904) and so
they are blind to the benefits that taxes might bring to a community and the individuals
living in it. Their myopic focus on one detail has resulted in the loss of any foresight they
might once have had. Their alarms are only halfbaked. Consider the following:
1. Ms Daniels writes in her opinion piece that “...rather than continue to work hard at
searching for creative solutions to balancing the city budget, such as by reducing the city
staffs’ pensions, [etc.] ..., our elected officials would rather choose to scare the public by
portraying a scorched earth approach to balancing the budget.” Her statement is FALSE.
Consider slide 63 from the City Manager’s report of 9 Sept 2009 (available on the City website),
which I reproduce below:
Note the words: “This option would be utilized in conjunction with regionalization,
privatization, and reductions in staff, as well as wage and benefit concessions”. The City
Manager proposed and is even now doing the ‘creative solutions” she can only write about. She is
wrong on this central point of her complaint, and so her credibility is damaged. Is she wrong
on anything else?
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2. She claims there is a disparity between what the City Manager said at the 9 December
meeting and what the brochure says. She wrote, “Szerlag had even stated at the City Council
meeting on Dec. 7 that if the tax increase passes, there will still be staff reductions and cuts to the
budget, but the brochure paints a much different picture. The brochure says that if the tax increase
passes, Troy will maintain full service levels in the Police and Fire departments and the city will
maintain activities in the library, the community center, the museum and the nature center.” Ms
Daniels has misread the words: The brochure does say that full service levels will be maintained
in the Police and Fire departments. But “full service levels” DOES NOT MEAN full
employment. It means that full public safety activity will be maintained by a somewhat
smaller number of employees such that noncritical functions may well take longer to be
completed in future because of staff cuts or privatization or regionalization – both of which
will mean that frequency of activities &/or services will be take longer, or be done less
often, or people may have to go to some other location for certain services. The
contradiction she claims to see does not exist; no wonder her formal complaint was
rejected by the Secretary of State’s office.
3. In comments elsewhere, opponents of the proposed millage have made statements that
strongly suggest they have not read the data in the City Manager’s report of 9 Sept.
regarding the constraints on Troy raising money by selling public property. For example,
one of the responders to Ms Daniels’ opinion piece suggested selling the golf courses. The
City Manager has pointed out (on Slide 3 of the City Manager’s report of 9 Sept 09) that the
outstanding debt for the Sanctuary Lake Golf Course exceeds the market value of the land.
In addition, other uses of the land are highly restrictive since the course is built on the site
of a former landfill. As for the other golf course, it is likely that the sale of the property for
commercial or residential development would lower the value of nearby properties, hurting
their owners and likely providing no real net profit to the City. The City Manager went to a
lot of trouble to put together a forward look at our financial futures and the several options
we have to choose from. Many critics appear to not trust the City Manager’s numbers. Note
that the City’s numbers are based on independent estimates of Oakland County’s financial
future, prepared by L. Brooks Patterson and his associates. If you disbelieve the City’s
numbers, then you must also disbelieve the County’s numbers. And if you disbelieve theirs,
then you must also disbelieve the State’s numbers which are equally dismal. And If you
disbelieve all three, then you must explain to the rest of us ordinary citizens just why we
should believe your opinions when they are not supported by any official numbers. Where
did you get your superpowers? Or should we consider the possibility that the City, County,
and State numbers are right, and you are wrong? Remember, just because you say
something does NOT make it true. Data and numbers test your statement, and
if you offer us no numbers and no data, then your words are unsupported and
not deserving of serious consideration.
4. Troy Citizens United and Ms Daniels are doubtless sincere in their beliefs. But
their statements are factually incorrect and thus false. Once Ms Daniels and
other members of Troy Citizens United read this essay, will they have the
courage to take public responsibility for their false statements and withdraw
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them? If so, then they should be admired for their integrity, if not for their
vocabulary. If they do not publically retract their false statements, then should
we not avert our eyes from their besmirched honor? Why should we listen to
false prophets who abuse civic responsibility by spreading false tales of
conspiracy and incompetence?
Robert Arking
EDITORIAL 2: MYOPIA IS NOT FORESIGHT, or WHAT’S IN A NAME?
Question: WHEN IS A TAX LIKE AN INSURANCE POLICY?
Answer: WHEN YOUR HOUSE WILL DEFINITELY LOSE VALUE IN THE ABSENCE OF THE
TAX BUT LIKELY RETAIN ITS VALUE IN THE PRESENCE OF THE TAX.
Taxes and House Values: What is the Smartest Strategy?.
The opposition to the temporary millage proposed by City Council lies mostly in
the fact that it is a tax. The several tax opponents are firmly opposed to taxes in
principle, mostly because they view them as taking money out of their
pocketbook and so lowering their own wealth and standard of living. Is that
always true?
For most families, their home is their largest or secondlargest asset. Its value is
obviously important to your future financial value and sense of security. So what
makes up the value of your home? The old real estate mantra of “Location,
location, location” is the answer. A four bedroom, three bath colonial in Troy
probably has a higher value than a comparable home and lot in Sterling Heights
or Rochester or Clawson or elsewhere. So what is it about a Troy location that
makes it more valuable? When Money Magazine ranked Troy as the 22 nd best city
in the entire USA (and the 2nd best in Michigan) to live in, it was apparent from
their commentary that they found Troy provided an excellent quality of life. The
components of this quality of life were made up in large part of PUBLIC services
such as schools, parks, civic amenities, and the like. So some large part of the
sale value of your Troy home is directly due to the perceived high value of the
public services provided by the city! The diminishing or cessation of these
services would then have a dismal effect on the market value of your home.
Is there any data that suggests that Troy’s public services act as a buffer against
the downward trend of home prices in neighboring communities? There is.
Consider the data contained in the top slide of p. 7 and the data in the top slide
of p. 12 of the City Manager’s report of 9 Sept 09. These two sets of data contrast
the rate of decline in the real estate tax revenues of Oakland County vs Troy over
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a four year period. If the hypothesis that public services add value to your house
is real, then we would expect to see that Troy will have a smaller percentage
decline in revenues than would Oakland County. The key data from those slides
is summarized in the Table:
Year % Loss in Oakland Co. Home Value % Loss in Troy Home Value
2008 4.5% 0.0%
2009 13.0% 1.0%
2010 12% 12%
2011 5% 10%
% residual value of a
78.4%
69.5 %
house at the end of
2011 of original value in 2008 of original value in 2008
Troy property as a whole decreased by ~12.8% less than did Oakland Co.
property as a whole. So a house worth $300,000 in both areas in 2008 would be
worth at the end of 2011 $208,500 in Oakland Co. but $235,200 in Troy. That is a
difference of $26,700, or 12.8%, which we can deduce is the minimum effect of
Troy’s public services and amenities on your house. In other words, oneeighth
of your home’s value seems to be attributable to the market’s valuation of Troy’s
public service on your house.
So now let us return to the belief that taxes just take money out of your pocket
and reduce your wealth and standard of living. We now have the data necessary
to critically test that proposition. It is estimated by the City Manager (slides 10 &
64) that the average tax bill will decrease by ~$158 in 2010. If the proposed
millage is passed, it will cost the average Troy homeowner ~$38 more in actual
cash outlay/year [e.g., ($103/mil in 2010 x 1.9 mils)$158 decreased base tax in
2010)=$38]. Most of the proposed tax millage in 2010 will be offset by the
projected decline in your base tax rate; thus it is almost a wash in terms of the
actual monies you lay out in 2010 versus 2009. More data is needed to accurately
calculate the proposed millage for the following four years, but if we assume the
net cost would be more or less the same for the life of the tax, then you will pay a
grand total of $190 ($38 x 5) over the life of the tax. Paying the net tax of $190/
five years saves you the sum of $26,700/five years in the value of your house. If
the millage is defeated, then the City tax bill for the average homeowner will
decrease by ~$158 in 2010. If we assume that same decline will hold over the five
year span, then the average homeowner will save at least $790, and possibly
more, over a five year period. This is a sizable sum, to be sure. But it is saved at
the almost certain risk of your house losing an additional $26,700 in its value (as
per the example above). There is no free lunch. Saving on your taxes will cost
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you on your house value. And if the millage is defeated, and if fire and/or robbery
insurance rates go up, then it is possible that your hopedfor tax savings will not
stay in your pocket but will wind up in the pocket of your insurance company.
There is NO good choice – all you can do is Choose your poison – and you
might as well choose the poison that harms you the least.
The premise of the tax opponents that the millage will take money out of your
pocket and reduce your wealth is just NOT TRUE. The millage will actually save
you a large multiple of the net tax difference you will have to pay, perhaps not as
much as in the example discussed above, but still a significant amount relative
to what you will save on city property taxes. You are basically making an
unorthodox but potentially effective insurance bet that your losses will be
significantly less with the tax than they will be without the tax. You are, in effect,
hedging your expected drop in home value by betting the maintenance of city
services will maintain your home value or at least minimize any losses you might
endure. This is a smart bet. Robert Arking
Editorial 3. BEWARE OF GREEKS BEARING GIFTS\
That old Trojan horse saga may have spawned a well worn cliché but it is as true today
as ever. For several decades now, states and municipalities have been in a bidding war to
bring industry to their area. All a company has to do is let it be known they are considering
“opening up shop” somewhere in the USA and you see a scrambling to entice them “to our
area” like nobody’s business.
You see it currently with Michigan trying to bring the film industry to Michigan with
some big and controversial tax incentives. Our Governor spends a lot of time going to places
trying to pitch Michigan as a place to do business. But we are not alone. Virtually every state
in the union has tried to entice business to their state. Often with big tax incentives, free land
to build on and inevitably we tax payers at the least pay for road improvements to
accommodate this business. But at what cost?
Overall, I get the distinct impression that far too often, states and municipalities are
patsies in this bidding war to bring business to their place. Are the offers too generous? Is the
net gain more than the loss of revenue? I think we taxpayers and the city of Pontiac got
screwed over the Silverdome – twice. I think the Lions got off far too easy and now it appears
it has been sold for a mere pittance. These cases are but a drop in the bucket of examples of
how we got taken to the cleaners.
Examine this one case – and you decide. The state of North Carolina won the “bidding”
war for Dell, the computer giant, to build an assembly plant in their state. What did it take for
North Carolina to pull off this deal? How does $318 million in tax giveaways, cash, grants, and
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a host of other freebies sound? In October 2006, Dell opened their $7 million dollar plant.
Just a mere 4 years later, Dell announced they are closing the plant and shipping operations
to Asia somewhere. There goes 905 jobs – future tax revenue and now North Carolina has an
empty plant on their hands. What did it ultimately cost North Carolina taxpayers – about $9
million in road improvements, $5 million in worker training and hiring services and about
$3million in tax breaks that Dell has already received?
Far too often businesses are ready to accept a “hand out” but balk at paying their fair
share of taxes to fund the state or municipality. I have to wonder at the integrity of the
government officials who negotiate these deals. Are they naïve – or just plain stupid? It
seems to me that any such “deal” should include an ironclad penalty for “pulling out” before a
solid specified period of time. Say 30 years minimum!!! I’m not against offering incentives to
industries to locate here, but if they don’t contain some penalties, then we are left to the
avarice of their business decisions. We taxpayers are the ultimate victims. If all we are
depending on is the personal income taxes generated by this new business, then even this
accounting novice knows it takes decades to recoup those investments.
I think we are spinning our wheels until this nation decides to come up with a solid
reasonable and practical trade policy. Call it “protectionism” if you like – I call it “self
preservation”. I’m tired of seeing my governor hustling for business overseas, when she
should be concentrating on administering our state. But this is the dilemma we face due to a
lack of a fair trade policy at the national level. If we had such a policy; you wouldn’t see states
competing to the extent they have been forced to do. In the meantime, unemployment
remains high – our state revenues are in the tank and we citizens wonder who is “running the
store” – we the people or special interests!!
Mike Smith
Editorial 4: Why Are Today’s HiTech Green Jobs in China and Europe & Not in the USA?
The Atlantic Magazine for July/August 2009 had an article (p. 78) by Joshua Green entitled
“Better Luck This Time” which points out that history does repeat itself, and we may never
learn from it. In 1977, President Carter pointed out in a speech to the nation that the best way
to disentangle ourselves from Middle East quarrels was to develop renewable energy and
gradually rid ourselves of dependence on Mideastern oil. Carter installed solar panels on the
roof of the White House. He said, “A generation from now, this solar heater can either be a
curiousity, a museum piece, an example of a road not taken – or it can be a small part of one
of the greatest and most exciting adventures ever undertaken by the American people;
harnessing the power of the sun to enrich our lives as we move away from our crippling
dependence on foreign oil.” As a matter of policy, he then issued tax credits for companies to
develop the renewable energy technology. By the end of his term, the US was by far the world
leader in solar and wind technology.
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That solar panel is now a museum piece. Upon taking office, President Reagan tore down the
solar panels, and they eventually wound up in the Jimmy Carter Library and Museum in
Atlanta. Reagan in 1985 also tore up and ended the tax credits on renewable technology. At
the time that he did this, the US had 80% of the world’s windpower capacity and 90% of the
world’s solar power capacity. The industry died. In 1992, a Democratic Congress reformed
and reinstated the renewable energy tax credits, and the industry took off once again – only
to expire once again when the tax credits were not renewed by a Republican Congress. “This
boom and bust cycle repeated itself three times over the next decade, and very nearly a
fourth. Last fall, after 18 attempts to extend the production tax credit, Congress ...allowed a
oneyear extension to squeeze through.” If you were an entrepreneurial business person in
this field, would you once again start up your investments in domestic solar or wind power in
the face of such mercurial onagain, off again political swings? Or would you – being an
internationally minded person – look for some other country where a favorable and steady
assistance to your industry could be found? Germany offers steady long term support and
export assistance to its renewable energy firms, and so is now the world’s leader in solar
panels. Germany – with weather like Michigan where the sun is a stranger for half the year –
is a leader in solar power? The US once produced ~80% of the world’s wind turbines. Today
you can read advertisements about the virtues of wind power for Americans – using turbines
built by Siemens. China has decided to go full steam ahead (so to speak) on renewable
energy and so has just lured the largest American manufacturer of solar panels to sell their
latest hightech product to China – provided that the company will build the world’s biggest
solar panel plant in China and share its technology with its local Chinese partner. They
agreed. And so our high tech jobs will go there. Unless something changes.
The Obama stimulus plan saved the day last year by awarding the industry $32.7 billion in
direct grants and another $134 billion in loan guarantees to attract new investors to large
projects. Note that these are not tax credits. The next step will occur this summer when
Congress will consider making renewable energy standards as national policy. Many
Republicans and others who do not know their history will object to such federal standards in
the name of fiscal conservatism or federalism or whatever ideological excuse occurs to them.
As Joshua Green writes, “The key to our energy future lies in exploiting two often opposing
forces without having them trample or undermine each other: Silicon Valley’s free market
culture of innovation and Washington’s power to set the terms by which everyone operates.”
We have already seen what happens to our high tech jobs when ideological politics keeps
changing the governmental signals at a time when business people all over America are
looking for some long term guidance so that they can plan where to put their investments. If
we listen to the Republicans and other backwardlooking politicians, and scuttle the
formation of national standards, then we can plan on our grandchildren going to visit some
Museum of Failed Hopes in which may be seen THE LAST AMERICANMADE SOLAR PANEL
& WIND TURBINE.
Or we can pressure our representatives to put the standards into place with the hope that our
grandchildren will find interesting and rewarding careers with American renewable energy
firms.
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We listened to Reagan and all we got was a Lousy Deal. Maybe we should listen to Obama and
get a New New Deal.
Robert Arking
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