Thursday, September 09, 2010

Job poaching

Companies rise and fall. Sometimes between that rise and fall, a company will relocate. It sucks when they move from here to there, it's great when they move from there to here, but on the whole it creates undesirable uncertainty for locals. A city might lose 1000 jobs one month and gain 1000 jobs the next, but wouldn't you rather keep the original jobs if you could?

While companies have a right to move from state to state, (and should do so if it means staying competitive) states and cities should not encourage arbitrary corporate migration. Indiana should pursue a reciprocal agreement with other states that they will not use tax dollars to lure a company away from another state. In other words, we won't steal your jobs if you promise not to steal ours. A federal law would be nice, but Congress has been unpredictable as of late.

Interstate job poaching is a drain on state resources. Rather than spending millions to attract companies that will only stay until they get a better offer, states should reaffirm their commitment to companies that are in it for the long term.

8 comments:

Daddy said...

Do you think Indiana can reach a reciprocal agreement, lets say with Vanuatu republic, and if so that they would keep their word?

CEOs types move their companies to better pastures. That both means a better quality of life to them, and less liability to them and investors.

Hence Fort Wayne is a dull place, with a meager quality of water and air, high allergy vegetation, West Nile mosquitoes, vicious judiciary, and ol' boy network, and hardly competitive private schools, why would a CEO type even consider staying here and not to relocate to a pasture where everyone and their dog is relocating to?

Phil Marx said...

Robert,

Governments represent the people, so what you are actually proposing is a law to prohibit groups of people from engaging in competitive bidding for jobs. I still think you're the purest (philosophically speaking) Libertarian I know, but I think this post shows an exception to that.

Robert Enders said...

Daddy,
The US Constitution prohibits states from signing treaties with foreign countries.

Phil,
I do not think that this is an exception. A law that prohibits a state from misusing tax dollars is a good law, and is consistent with the Libertarian philosophy. Voluntary associations of people would not be affected by such a law. If you and your friends want to use your own money to lure a business here, go right ahead. (Although if you had that much money to blow, you might be better off starting your own business!)

There is also nothing unlibertarian about reciprocal agreements. Even if a new federal law is impossible, there is no reason that all Midwestern states couldn't agree to avoid economic shell games.

PhilMarx said...

Robert,

If I had that much money, I'd simply buy myself a few Congressmen to do business for me - just like those who have serious money already do.

Daddy said...
This comment has been removed by the author.
Daddy said...

Robert,

consider trying to raise a US constitutional issue in a local court and you may observe an interesting effect.

I am aware of at least one such Indiana State agreement with a number of foreign countries (beside those that feds have already agreement with) in enforcing what they call 'child support' payment from foreign residents to Indiana residents (some folks think as to get more federal funding to their own 'local agencies' per notorious U.S.C.A Section 42 Title IV-D, - consider looking up this county budget numbers). Since this is a small 'potatoe' compared to what local/state judges and 'local agencies' determine themselves what they receive from feds based on their own decisions (check this county budget), feds do not bother to intervene. Its easier for them just to print more cash, and ignore law violation by states.

Robert Enders said...

Daddy,
Indiana cannot sign treaties with foreign countries. But as part of the US, Indiana is bound by any treaty that the US has signed.

Daddy said...

Robert,

Here now, I find it for you:

http://www.passportsusa.com/family/services/support/support_2600.html

Lindon dude with his mafioso Social Security Act helped them out again.