Wednesday, June 29, 2005
On this day:

EADS Incentives and Government "Takings"

From the Mobile Register:

One incentive that helped lure EADS North America to Mobile became clear Monday: public money will pay for the 65,000-square-foot building that will become home to the company's aerospace engineering center.

The Mobile Airport Authority will own the new building and lease space to EADS on a long-term, low-cost basis...

The state is in line to pay for all of the engineering center construction...but Mobile County and the city of Mobile may kick in some money, depending on whether EADS goes on to build an aircraft assembly plant...

I applaud the efforts of state officials to bring the EADS plant to Mobile, but I have to admit that I'm uncomfortable with incentive packages that give away taxpayer dollars to big business (or, for that matter, any private enterprise) for facilities, worker training, and the like. These public expenditures provide direct benefits to private businesses, while only indirectly benefiting the public through additional jobs, economic growth, etc.

In this instance, the state is taking taxpayer money and transferring it to a corporation for purposes directly related to that corporation's bottom line. We're not talking about building roads or providing infrastructure here. This is corporate welfare, pure and simple.

So, the state is using public resources to build facilities that 1) are almost exclusively dedicated to private use, and 2) have traditionally, and appropriately, been financed at private expense. Ring a bell? This is part of the same debate that's been raging since last week's Kelo decision. The only difference is that the "taking" in this case is money, which is fungible, rather than land, which is not. The sad thing is that neither political party in Alabama seems to care.

There's little doubt in my mind that EADS coming to Alabama is a good thing, but whether that feat was accomplished by sacrificing economic liberty is an open question.