Problem is it becomes a bidding war that causes states to forego tax revenue with ZERO recourse if that company decides to pack up and move somewhere else. This is especially true of companies that are not bound by development costs (e.g., Amazon warehouse vs. a semiconductor fab). Several New England state economies are fucked because they gave away tons of money in tax breaks hoping increased sales tax and income tax (on workers for those companies!!!) would offset the tax giveaway. E.g., CT is fucked for this very reason.

Eventually the state has no recourse if the company changes its mind. Go look at what's happening with Foxconn's multibillion dollar scam in Wisconsin. Or Hillsboro oregon where intel gets 30 years without paying taxes. (Granted, Intel can't pack up and move easily because they invested 10's of billions in a big ugly fab that pollutes [see the "waivers" they "negotiated" to allow them to continue dumping fluorine emissions to avoid costly fab retrofits]).

One solution is to allow states to sue if a company breaches contracts. But many states are just piss poor and cannot afford to take on a trillion dollar company (Amazon, Facebook), or a company from another country (Foxconn).

Another solution is to actually tax corporations federally, since the government already redistributes blue-state wealth to red-state welfare.

Warren has a great idea: tax companies on their SEC revenue CLAIMS rather than their IRS filings, which tend to differ by billions.

Sounds like the states suck at negotiating contracts.

Why would you to give something of value, with no recourse if the other party doesn’t deliver?

We need to look at this in basic terms. Why even have businesses? Why have jobs? An economy? Ultimately, the entire reason we want any of these things is so we can make our lives better. Any policy we make with regards to corporations needs to be framed in that context.

The vast majority of large companies are well-oiled machines with one purpose: extracting wealth from somewhere and placing it into the pockets of a few people with power within those companies. In a lot of cases, that "somewhere" is "the pockets of average people". On a global scale, corporations are almost always a net negative for the basic reason we want them around in the first place.

But we're not looking at things from a global scale, we're looking at them on a local scale. And on a local scale, we know that you have to spend wealth to gain wealth, so we hope by getting companies to set up shop in our back yard, that they'll do the wealth extracting elsewhere and do the wealth spending here.

But this isn't a deal with the devil we should make blindly. It wasn't so long ago that corporations in the US were feeding us diseases, forcing us into windowless sweatshops where we would die if they caught fire, selling us exploding cars, and poisoning our drinking water. And they're still doing all of these things in other countries. And they're still happy to lie to us, dump slightly less poisonous chemicals into our drinking water, sell us counterfeits, start wars, and heat up our planet. Corporations aren't our allies, they aren't our friends, they're machines that will literally kill us if it helps with the wealth extracting, and they need to be approached with appropriate skepticism. It cannot be assumed that simply having businesses around is going to be a net positive, so steps need to be taken to be sure that it is.

One of the key ways to make sure that corporations are a net positive is to make sure they pay their fair share for the resources they consume. That's taxes. So I'm understandably very skeptical about any effort to lower taxes on corporations, because that sounds suspiciously like letting them extract more wealth than they give back. If they aren't willing to pay their fair share, then they aren't a net positive, so we don't want them around.

We have to remember, this isn't a one-sided deal where we're begging for scraps at corporations' tables and are snivelingly happy to just have them around. They need us too. Workers are worth their hire, and workers want to live in places where their communities provide services to them. We can and should demand that corporations pay taxes to support our communities. If tax breaks are really necessary to attract companies, why are so many of the places with the largest economies also some of the highest taxes?

And more importantly, going back to the basics again: the highest standards of living also occur in places with the highest taxes.

[1] https://slatestarcodex.com/2014/07/30/meditations-on-moloch/