The Newer Math: To Create Jobs We Must Cut Job-Creating Incentives

By Richard Thayer

Not only was I never a big fan of the “new math,” I wasn’t even a fan of the “old math” back during my nefarious high school days.

Now the politicians have unleashed upon us the “even newer math,” which states that in order to increase something you must subtract from it.

In Friday’s High Point Enterprise, on the front page, one headline reads: “Local economic developers fear incentives cuts.”

The article concerns Senate Bill 13 that would axe $75 million from economic incentives used by local governments to attract new businesses, and create jobs.

Two of those incentives funds affected would be One North Carolina Fund and Job Development Investment Grants. In 2010 these incentives funded 10 projects in the Triad area and will create approximately 1,407 jobs.

Quoted in the article is Bonnie Renfro, president of the Randolph County Economic Development Corporation who says that these incentives are necessary to boost commerce and cites 80 jobs created in Asheboro last year as a direct result of the incentives.

To me, that makes sense: investing equals growth, equals job creation. Am I being too simplistic here?

On the other hand there’s Jeannette Doran, senior staff attorney with the NC Institute for Constitutional Law who says, “The government is going to have to tighten its belt.”¬† In other words, it’s going to have to cut the incentives programs along with the pay of state employees, and state employee jobs.

The paper didn’t give any information on this NC Institute for Constitutional Law, so I Googled it. Although it bills itself as non-partisan, the issues it supports, are partisan and lean to the right. One of its board members is the founder of the John Locke Society, a conservative “think tank.”

So on one side of this argument we have some economists who say passage of Bill 13 would likely stymie job creation, and on the other hand, who have some well-paid attorneys and lobbyists who say we need to “tighten our belts.” When coming from an attorney you should read that as “You need to tighten your belt.”

So who do I side with here? Economists who do this kind of thing for a living, or a group of right-leaning lawyers?

If the American people (I being one of them) are saying that we need more jobs, how exactly is Senate Bill 13 going to address that crying need?

Just asking.


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