Gov. Bev Perdue’s latest Executive Order offers a new taxpayer-funded subsidy to a small group of companies. This group is North Carolina-based companies doing business with the state. These companies will be able to submit a bid up to 5% or $10,000 higher than their out-of-state competitors.
It is not about jobs. Fidelity Investments, based in Boston but employing thousands of people in North Carolina, would have to underbid Bank of America, based in Charlotte, by at least five percent to win a state contract.
It is not about the economy. Few North Carolina companies do business with the state. When the state pays more for a product or service, that money either has to come from another program or from higher taxes – taxes paid by every other company and worker in the state. And North Carolina already has one of the worst business tax climates in the country.
It is not about results. Other state subsidies and targeted corporate welfare programs have failed too many times to expect this one to work better. If those other programs worked, the state would not now be on its way to borrowing more than $2 billion from the federal government to pay unemployment benefits.
This is simply a PR stunt by the governor that will make North Carolina even less friendly to businesses and workers in the name of helping a privileged few.
