Maybe Haz-mat meant socialist free market...

It's called doing business. Sure...give them tax cuts. The new jobs are going to increase the tax base. A plant is a good thing so long as they're not dependent on it. A new plant now could just as easily close later. Oh wait, it's a Honda plant...it'll be there forever!

 

Yeah. I skipped the day they covered all of economics in government class. What was I thinking.

If we are going to consider ourselves a free market, then the tax cuts are no more than government subsidies of the industries. And we all know from the economics experts on this boards that subsidies are at best socialism and at worst pure red communism.

 

Totally agreed, at least to the extent that the tax incentives are selective in nature (and in practice, they certainly are). If the government favors one company or industry over another via the granting of tax breaks, that is indeed a flavor of central planning (i.e. socialism) that conservatives have learned to swallow without so much as flinching.

In Michigan, we saw a lot of good jobs leave the state (and usually the country) due to a heavy tax burden. It's nice to see that there's a bit of an awakening with regards to the effects of taxation on business, but I fear that the message isn't getting through and that we won't see widespread reform in time to prevent further losses.

 

You call it socialism, I call it the natural reaction of a GLOBAL free market. You want a foreign company to have a reason to come here? You gotta give 'em one. That's a free market on a global scale and it requires action on a government level.

 

Heh. Some of our more conservative (although in reality it is historically more liberal) friends' views are such that any government intervention is 'socialism.' These tax breaks, since not to all of the industry, are analogous to a state sponsored subsidy of that particular company. I suppose we can argue about what exact type of economic policy this is if we really want to. We wouldn't really get anywhere since an isolated tax incentive is hard to attribute to any macroeconomic theory I just wanted to point out that such an incentive to one company isn't really the sort of thing that Adam Smith had in mind when he was talking about the invisible hand.