I agree to an extent, but some important parts of the story have been buried. Like, for instance:
"It may seem like a juicy story to have this confrontation between California and Texas, but that was not the case," said Jim Lentz, Toyota's North American chief executive.
"It doesn't make sense to have oversight of manufacturing 2,000 miles away from where the cars were made," Lentz said. "Geography is the reason not to have our headquarters in California."
But Rottweiler is correct that states are having to offer tax incentives to stay competitive. This is why NYS is aggressively courting business with a whole range of tax breaks that would have been impossible 20 years ago.
See this: START-UP NY |
These tax breaks are not a win-win since some states have to defund public transportation (which poor workers, in places like NYC, require) along with needed infrastructure. Of course, they don't just defund it, they take on massive debt to offset the revenue shortfall of the anti-tax revolution, which has pretty much won. There isn't much choice. States no longer have good options, and they are desperate for jobs. This is why they are being forced to offer business "the 3rd world deal", i.e., pollute our rivers, don't pay taxes, and pay your workers enough to live under a bridge... Which is why the expensive housing in SoCal ain't an option for Toyota workers.
Both California and NYS are having to make huge concessions to retain corporations, and both states are finding that they cannot always offer the kind of certainty in future taxes that some corporations requires. Another problem Toyota cited was the cost of living for its employees. Southern California's Mediterranean climate is so desirable (see high demand) that it has priced out the poor. It also has the greatest infrastructure costs in the nation, partly because it has the highest population, but also because of its massive misallocation of resources into car culture, which worked great when gas was $2 gallon or less. Today, however, the country's most car dependent economy is being swallowed whole by the end of cheap oil, and there is no "plan B". LA - one of the most spread-out cities in the world - depends on cheap gas prices. This could have been mitigated with Alternative Energy and conservation, two things that would have brought energy costs down but were crushed in the 80s by a political movement funded by big oil. Regardless: California has huge problems - and they're only going to get worse.
Regardless, I am in partial agreement with the OP.
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