Fitzsimon File

Just when the wrap up stories and angry columns by misguided critics about the 2007 session of the General Assembly have tapered off, lawmakers are coming back to town to consider overriding Governor Mike Easley’s veto of legislation that would have given as much as $40 million to Goodyear to keep its plant in Fayetteville.

Easley vetoed the bill Thursday, saying the bill didn’t include enough safeguards and would allow Goodyear to receive the money even it laid off 700 workers.

Wednesday, Easley announced his own plan to help existing industries. It includes a requirement that local governments also provide incentives, mandates that the company pay wages well above the county average, and provides tax rebates instead of cash payments.

The release announcing Easley’s plan included a quote from an executive with Bridgestone Firestone, which has a plant in Wilson. Critics of the Goodyear legislation had pointed out that it put the Wilson plan at a disadvantage.

Easley’s response is apparently to provide incentives for both plants if they meet certain conditions.

House Speaker Joe Hackney said Thursday afternoon that a special session would be held the second week of September to consider overriding Easley’s veto.  Earlier in the day, he told the North Carolina News Network that lawmakers tried to write the Goodyear legislation as narrowly as they could to protect the 2700 well-paying jobs in Cumberland County and that Easley’s plan appears to spend more money that the legislation he vetoed.

At first glance, Easley’s approach makes more sense with its wage requirements, rebates instead of cash, and treating both tire companies the same. But sense and rationality are not hallmarks of the business incentive debate in North Carolina.

Hackney is staking out the fiscally responsible position, pointing out the higher costs of Easley’s plan, but fiscal responsibility is also not often the priority when incentives are up for discussion.

And there is certainly more at play here than just the details of competing corporate welfare plans. Hackney is a fierce defender of the General Assembly as an institution, so some of the disagreement is grounded in the battle between the two branches of government.

Senate Majority Leader Tony Rand, a primary sponsor of the Goodyear legislation is normally a strong Easley ally. But he is also a powerful lawmaker used to having his way and he may view this as a personal affront, especially since it concerns a company in his hometown.

Another question raised by the dispute is where was Easley when the legislation was working its way through the General Assembly this summer? This was not a secret provision snuck into the budget. It was debated in committees and on the House and Senate floor. A Goodyear executive came to testify in the Senate Finance Committee.

If Easley was so opposed to the legislation, why was that not clear to lawmakers before the bill passed? Either Easley was not involved in the negotiations behind the scenes or he made his opposition clear and lawmakers ignored it, daring him to veto the plan. Either way reveals something about the Administration’s presence in the General Assembly and its relationship with key lawmakers.

More disturbing than the power struggles inside the Raleigh beltline are the implications of Easley’s solution, which despite the safeguards, amount to giving more money away to more businesses.

Easley said at his veto news event that he had changed his mind about the need for the federal government or the courts to step in and stop the incentive bidding war between states, a position he held as Attorney General.

Easley says no he longer believes that because now North Carolina is competing with other countries for jobs, not just neighboring states, and he mentioned places like Singapore and Eastern Europe as examples.

Let’s hope that doesn’t mean that the next competitiveness package from the Governor’s office includes giving even more money away or relaxing safety and health standards that are stricter than developing countries.

North Carolina needs to be supportive of business and economic development and virtually every survey shows that it is. State policymakers don’t have to give away the store to bring jobs here and they don’t have to race to the bottom to match every one of our competitors. 

Invest in the people and the infrastructure and the jobs will come.

 Email This Post  Print This Post

This entry was posted on Thursday, August 30th, 2007 at 2:44 pm and is filed under Fitzsimon File. You can follow any responses to this entry through the RSS 2.0 feed.