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Wisconsin has negotiated a dramatically scaled-back deal with Foxconn

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Re: Wisconsin has negotiated a dramatically scaled-back deal with Foxconn

#71

Post by waterheater »

ThaDood wrote: post #49
waterheater wrote: post #44

Do not trust Foxconn. I strongly believe they're playing a long-term game here. For example, the Foxconn plant is on a particular tract of land only partially within the Lake Michigan watershed. Anyone living within the watershed must return their water, and it must be cleaned up first. My understanding of the Great Lakes Compact is that Foxconn's land is one of legal ambiguity, that they may draw from Lake Michigan…

Not to be a naysayer, but do you have any sort of evidence to substantiate this claim? Any evidence of exceptions to laws regarding the usage of the watershed and lake with specific regards to Foxconn? Or any kind of indication that a bottling facility will be built up?

Hard evidence? No. The exact plot of land they chose is not particularly remarkable, so I must wonder why they chose a piece of land straddling the watershed, given that the Compact [1] indirectly applies to corporations.

There's a deeper political aspect to Foxconn's presence that I can't trust. I'm from Wisconsin, and the whole Foxconn deal leaves me feeling extremely uneasy. Leaving aside the Wisconsin and USA politicians associated with the deal, Terry Guo briefly ran for president of the Republic of China. Guo and Foxconn made significant donations to UW-Madison. It smells wrong, and all the Wisconsinites I've talked to agree.

I'm glad their subsidies were slashed.

[1] https://www.gsgp.org/media/1330/great_lakes-st_lawrence_rive...

Re: Wisconsin has negotiated a dramatically scaled-back deal with Foxconn

#72

Post by luckylion »

myrmidon wrote: post #56
luckylion wrote: post #4

Is it just me or has it become more common for journalists to write about decreases by saying "X-fold" or "x times"? I always get confused, I find it much easier to say "by 97%".

I believe everyone (with a basic education) should be able to understand both, but I think the X-fold representation is much clearer-- just compare how similar decreases by 80%, 90%, 95% appear at first glance-- but there is a full order of magnitude between EACH of those (while 50% and 55% is basically the same thing)! Calling it a 5-fold, 10-fold or 20-fold decrease makes the difference between them much more immed…

I find x-fold to be totally clear and intuitive for increases, but I find it weird for decreases. "We've decreased it by 5 times" sounds to me like "We've decreased it by 500%", which it obviously doesn't mean. "We've decreased it to 1/5th", "we've decreased it by 80%" makes more intuitive sense to me.

Maybe it is similar to miles/gallon vs liters/100km and depends on where you grew up. I feel like the usage frequency changed, but it could just be that I'm noticing it more.

Re: Wisconsin has negotiated a dramatically scaled-back deal with Foxconn

#73

Post by KZZ »

pen2l wrote: post #6
1cvmask wrote: post #5

Earlier quoted context omitted.

It’s funny that they are downvoting you for stating the obvious no-brainer explanation. Just curious as I am seeing more of this on HN lately or is it just the Baader Meinhof phenomenon after I read someone else complain about the recent downvoting phenomenon for stating the obvious. Has the readership changed of HN or more specifically the commentariat?

It wasn't really my take or opinion, I rather recalled it being cited as the reason by Foxconn itself in multiple instances. Also, I'm from Wisconsin, and an old EECS professor explained this to be the reason from his first-hand knowledge of some conversations with Foxconn. Here is one citation I was able to find quickly: https://www.reuters.com/article/us-foxconn-wisconsin-exclusi... He said the company was still ev…

The new approach is contract manufacturing for customers who are uncomfortable with manufacturing being performed in China, speaking from first-hand experience. This demand does exist and is what is going to be leveraged in the new park.

Re: Wisconsin has negotiated a dramatically scaled-back deal with Foxconn

#74

Post by 34679 »

danhak wrote: post #64
altendo wrote: post #61

I am always struck at the amount that states and municipalities are willing to write off in order to attract companies. On one hand, I understand that companies want to take the best deal, but on the other hand, at times local governments are willing to give up so much money in tax revenue. I remember reading about the competitions for Google Fiber and Amazon's second HQ - it felt absurd the amount cities and states…

They’re not really “giving up” anything if they attract a business that otherwise wouldn’t be there at all. It’s still a net gain to have a major employer in your locale, along with all the other economic benefits and tax revenue that entails.

They're giving up fairness and equality- equal treatment under the law. If the entire state wasn't completely devoid of any entities looking to compete in that space, it probably is now. Anyone making LCD panels in Wisconsin suddenly has a $80,000,000 greater financial gap from their largest competitor. If the lower taxes are good for creating jobs at a net gain to the local economy, then the lower rate should be applied equally among all similarly taxed entities.

Re: Wisconsin has negotiated a dramatically scaled-back deal with Foxconn

#75

Post by tppiotrowski »

altendo wrote: post #61

I am always struck at the amount that states and municipalities are willing to write off in order to attract companies. On one hand, I understand that companies want to take the best deal, but on the other hand, at times local governments are willing to give up so much money in tax revenue. I remember reading about the competitions for Google Fiber and Amazon's second HQ - it felt absurd the amount cities and states…

I think it’s a zero-sum game. Only one of your competitors has to offer a concession to win the business so you have to compete.

Re: Wisconsin has negotiated a dramatically scaled-back deal with Foxconn

#76

Post by cycrutchfield »

AlwaysRock wrote: post #67
danhak wrote: post #64

Earlier quoted context omitted.

They’re not really “giving up” anything if they attract a business that otherwise wouldn’t be there at all. It’s still a net gain to have a major employer in your locale, along with all the other economic benefits and tax revenue that entails.

It could be a net gain. Dropping a few thousand jobs and a factory into an area changes said area. Sometimes for the better. Sometimes not.

Most communities tend to prefer having lots of jobs available versus having too few jobs available.

Re: Wisconsin has negotiated a dramatically scaled-back deal with Foxconn

#77

Post by avs733 »

danhak wrote: post #64
altendo wrote: post #61

I am always struck at the amount that states and municipalities are willing to write off in order to attract companies. On one hand, I understand that companies want to take the best deal, but on the other hand, at times local governments are willing to give up so much money in tax revenue. I remember reading about the competitions for Google Fiber and Amazon's second HQ - it felt absurd the amount cities and states…

They’re not really “giving up” anything if they attract a business that otherwise wouldn’t be there at all. It’s still a net gain to have a major employer in your locale, along with all the other economic benefits and tax revenue that entails.

There should be research to support this argument. Has anyone found evidence for or against? Otherwise the claim here seems aspirational rather than useful.

I know that the history of stadium deals, for example, this claim is nearly universally made to support incentivizing sports teams - and the evidence nearly universally shows it to be false.

"In every case, the conclusions are the same. A new sports facility has an extremely small (perhaps even negative) effect on overall economic activity and employment. No recent facility appears to have earned anything approaching a reasonable return on investment. No recent facility has been self-financing in terms of its impact on net tax revenues. Regardless of whether the unit of analysis is a local neighborhood, a city, or an entire metropolitan area, the economic benefits of sports facilities are de minimus." [0]

[0] https://www.brookings.edu/articles/sports-jobs-taxes-are-new...

Re: Wisconsin has negotiated a dramatically scaled-back deal with Foxconn

#78

Post by jcranmer »

Invictus0 wrote: post #2

Can someone explain to me why Foxconn didn't build the plant? Why would they go through the trouble of negotiating this deal, which ended up phenomenally in their favor, just to throw their hands in the air and walk away?

From what I can tell, Foxconn never actually intended to build the plant. (I'm getting a lot of this from an interesting long-form article on the history of this deal; unfortunately, I don't remember where I found this article, sorry).

Essentially, Foxconn thought that the Wisconsin deal would work more typically as its deals in China went. Glad-hand the government officials, get sweetheart deals on land and investment, and as long as you're not totally incompetent in making use of it, they won't care what you do with it, even if you fail to live up to the original promises. It's not clear to me that Foxconn actually seriously considered producing LCD screens here given this light; the announcement would have been more to make Walker and other government officials ecstatic about the deal than an actual commitment to follow through. The fact that outrage towards the deal would lead to Walker losing reelection and his successor keeping a much closer eye on performance (or lack thereof) seems to me to have caught Foxconn completely off-guard.

I think there's another level going here in relation to internal Foxconn politics, but my recollection is too hazy to make a coherent explanation, and I don't want to make any false accusations here, so I won't go into any more detail.

Re: Wisconsin has negotiated a dramatically scaled-back deal with Foxconn

#79

Post by KZZ »

waterheater wrote: post #71
ThaDood wrote: post #49

Earlier quoted context omitted.

Not to be a naysayer, but do you have any sort of evidence to substantiate this claim? Any evidence of exceptions to laws regarding the usage of the watershed and lake with specific regards to Foxconn? Or any kind of indication that a bottling facility will be built up?

Hard evidence? No. The exact plot of land they chose is not particularly remarkable, so I must wonder why they chose a piece of land straddling the watershed, given that the Compact [1] indirectly applies to corporations. There's a deeper political aspect to Foxconn's presence that I can't trust. I'm from Wisconsin, and the whole Foxconn deal leaves me feeling extremely uneasy. Leaving aside the Wisconsin and USA pol…

Also a Wisconsinite here. I've been involved with the deal and haven't noticed any care about any watershed related things. Most of the business they've attracted so far are companies who want contract manufacturing outside of mainland China. The large "screen factory" is still largely empty, and they have no concrete plans for it, but the side projects which piggybacked on to that plan have seen some success.

Re: Wisconsin has negotiated a dramatically scaled-back deal with Foxconn

#80

Post by dntrkv »

34679 wrote: post #74
danhak wrote: post #64

Earlier quoted context omitted.

They’re not really “giving up” anything if they attract a business that otherwise wouldn’t be there at all. It’s still a net gain to have a major employer in your locale, along with all the other economic benefits and tax revenue that entails.

They're giving up fairness and equality- equal treatment under the law. If the entire state wasn't completely devoid of any entities looking to compete in that space, it probably is now. Anyone making LCD panels in Wisconsin suddenly has a $80,000,000 greater financial gap from their largest competitor. If the lower taxes are good for creating jobs at a net gain to the local economy, then the lower rate should be app…

> If the lower taxes are good for creating jobs at net gain to the local economy, then the lower rate should be applied equally among all similarly taxed entities.

I agree with the premise here, but in reality, you can see that won't actually work.

You have existing businesses in an area paying a certain amount in taxes. You want to attract a new major business. If you lower your taxes for all the businesses in hopes of attracting the new business, you just lost a huge chunk of revenue for something that might not come to fruition. Whereas if you don't lower your taxes, that new business has no incentive to go with your locale, and will instead, settle somewhere there is an already established talent-base/infrastructure/etc. Furthering the economic inequality between the regions.

I am not a fan of these tax incentives, but I can't blame these places for using them.

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