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Put the “United” Back in the United States of America

Boeing aircraft factory in Everett, Washington. (Photo: Prayitno/ more than 1.5... )

Last month, the Washington State legislature agreed to give airplane manufacturer Boeing a staggering $8.7 billion in tax breaks, in an attempt to keep that company from relocating elsewhere, and taking thousands of jobs away from the Evergreen State.

Once those tax breaks were approved, Boeing turned around and told members of its machinists’ union to sign a new contract, which meant giving up their hard-earned pensions for a risky 401K plan.

The union overwhelming said “no” to Boeing’s plan, and now the airplane giant is threatening to move out of Washington State, and is looking for potential suitors elsewhere in the U.S.

That’s where Missouri comes in.

After word of the union’s “no” vote spread, Missouri Governor Jay Nixon called a special legislative session in that state, where lawmakers approved a giveaway of more than $1.7 billion in taxpayer funds over the next two decades, to try to talk Boeing into moving to Missouri.

But that move came just months after Nixon slashed a whopping $400 million out of the state budget for 2014.

Several other states, including North Carolina and South Carolina, are similarly planning to make tax offers to Boeing.

When states offer up billion-dollar tax breaks and incentive packages to giant transnational corporations, you and I are left footing the bill.

That’s billions of dollars that’s not being spent on essential government programs and services, like education, transportation, and healthcare.

And the Boeing “megadeals” that Washington State and Missouri have offered up are not the exception; they’re the norm.

Back in 2007, New York gave $5.6 billion in taxpayer funds to Alcoa, the giant aluminum corporation.

In 2004, New Mexico handed out $2 billion in corporate tax breaks and subsidies to software giant Intel.

Just last year, Oregon lawmakers forked over just over $2 billion to Nike, to keep or create just 500 jobs in that state.

All across America, states are handing over billions and billions in taxpayer funds, to giant corporations to try to attract new business or keep existing business.

And these so-called “megadeals” are on the rise.

According to the organization GoodJobsFirst, in 1991, the total annual value of corporation-luring “megadeals” was around $1.1 billion.

In 2007, the total annual value stood at $8.3 billion.

But there’s a bigger picture to all of this.

These “megadeals” are pitting one state against the other, in a competition over who can hand over the most money to corporations.

And the corporations seeking these “megadeals” are driving a national race to the bottom, impoverishing states, and taking money away from vital programs like education, transportation and other social services.

Fortunately, there’s a way to put an end to all of this corporate welfare.

While the federal government arguably does have the power to stop states from luring corporations with billion-dollar tax breaks under the interstate commerce clause, a less draconian, and perhaps more effective way to achieve the same goal is by threatening to block federal highway funds for those states, an idea championed by Senator Bernie Sanders.

Federal highway funds are handed out to the states each year, with the money being used to maintain and build roads.

Each year, nearly $40 billion is divided up among the states, and most states rely heavily on those funds.

In fact, ten states rely on federal funds for more than 70 percent of their transportation funding.

California alone gets $3.5 billion in federal highway funds each year, and in South Carolina – one of the states planning to offer Boeing a giant tax break – federal highway funds account for 79 percent of state road and bridge spending.

If that money were to suddenly disappear, states would be facing a financial nightmare, which is why threatening to withhold it if they offer tax breaks to corporations to move from another state is a powerful threat.

What good is bringing a corporation to your state, if you don’t even have the money to fund your state’s infrastructure?

Every time a state strikes a corporate welfare “megadeal,” the American taxpayer is left to pay the price.

Let’s put the “United” back into United States, and stop the insanity of states competing over how much of their taxpayers’ money they’re willing to give to giant corporations in an endless race to the bottom.

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