Wisconsin Gets Wise To Foxconn's Grift, Blocks New Subsidies

from the took-you-long-enough dept

You might recall how Donald Trump and Paul Ryan's once-heralded Foxconn factory deal in Wisconsin quickly devolved into farce. The state originally promised Taiwan-based Foxconn a $3 billion subsidy if the company invested $10 billion in a Wisconsin LCD panel plant that created 13,000 jobs. But as the subsidy grew the promised factory began to shrink further and further, to the point where nobody at this point is certain that anything meaningful is going to get built at all.

Last October, reports emerged clearly illustrating the ever-shrinking nature of the deal and the way Foxconn was just using nonsense to justify its failure to follow through. While the company hadn't built much of anything meaningful in the state, it was still routinely promising to deploy a "AI 8K+5G ecosystem" in the state to somehow make everything better. Shockingly, that mish-mash of buzz words wound up being effectively meaningless.

Fast forward to late 2020, and Wisconsin finally appears to be getting wise to Foxconn's grift. Attempts to renegotiate the original deal understandably aren't going so well, and the Wisconsin Economic Development Corporation (WEDC) has finally rejected Foxconn’s latest application for tax subsidies, correctly noting Foxconn hasn't come close to fulfilling the promises in the original contract, which included spending $3.3 billion by the end of last year (Foxconn spent $280 million) or hiring 13,000 employees (they only hired 550).

Needless to say, the WEDC isn't particularly thrilled, since Foxconn's original promises died long ago, and the company has been consistently intractable in efforts to renegotiate a new agreement:

"The Recipients are ineligible for tax credits because of their failure to carry out the Project,” WEDC wrote in its letter to Foxconn, quoting the passage defining the project as a Gen 10.5 in the original contract. “The fact that the Recipients have neither built, nor started to build or operate, the required Generation 10.5 TFT-LCD Fabrication Facility (the “10.5 Fab”) is not in dispute. The Recipients have acknowledged that they have no formal or informal business plans to build a 10.5 Fab within the Zone, and WEDC and the State of Wisconsin have corroborated that fact from observation, evaluations, and from industry experts hired to provide consulting services."

For those keeping score at home, that's yet another Donald Trump show pony proposal that wound up being more trouble than it was worth.

Hide this

Thank you for reading this Techdirt post. With so many things competing for everyone’s attention these days, we really appreciate you giving us your time. We work hard every day to put quality content out there for our community.

Techdirt is one of the few remaining truly independent media outlets. We do not have a giant corporation behind us, and we rely heavily on our community to support us, in an age when advertisers are increasingly uninterested in sponsoring small, independent sites — especially a site like ours that is unwilling to pull punches in its reporting and analysis.

While other websites have resorted to paywalls, registration requirements, and increasingly annoying/intrusive advertising, we have always kept Techdirt open and available to anyone. But in order to continue doing so, we need your support. We offer a variety of ways for our readers to support us, from direct donations to special subscriptions and cool merchandise — and every little bit helps. Thank you.

–The Techdirt Team

Filed Under: boondoggle, donald trump, paul ryan, scott walker, subsidies, wedc, wisconsin
Companies: foxconn


Reader Comments

Subscribe: RSS

View by: Time | Thread


  • icon
    Koby (profile), 19 Oct 2020 @ 11:10am

    Good Riddance

    Corporate subsidies are generally a huge waste. Good riddance. Americans would be much better served by increased tariffs instead. It achieves the same goal, while being far less susceptible to corporatism, and it can generate revenue instead of wasting it.

    reply to this | link to this | view in chronology ]

    • identicon
      Anonymous Coward, 19 Oct 2020 @ 11:24am

      Re: Good Riddance

      There are many types of corporate subsidy, I suspect there are only a few that are comparable to tariffs, and corporatism has no impact upon tariffs?

      reply to this | link to this | view in chronology ]

    • icon
      ECA (profile), 19 Oct 2020 @ 11:42am

      Re: Good Riddance

      Tariffs were designed only to raise prices oon Imports of Like products.
      Anything other and its just Aiming at the consumer. NOT the corporations.
      Where in the USA do we have Any source that makes anything comparable to what was/is being created?

      And lets not forget, unless they dropped allot of pollution controls and requirements to CLEAN UP THEIR OWN MESS. Which corps are you going to allow into the USA?
      They ran off in the 70's and 80's, after we started finding their Dumping sites. Movies have been created about it. Documentaries of the Love Canal, and dead/dying/crippled children.
      Japan Quit, ROC quit most of it, China is looking at all the pollution created Running down its Major rivers and polluting the coast lines. And WE still have pollution from plastic imports that Corps think we want. Insted of using Products that are Easy and cheap to recycle, we created a system to use up every bit of petroleum products.(really) And pay tons of money one way or another for all the different uses of 1 barrel of oil.
      For some Odd reason we dont want to take 1 step back, and look at what was used and CAN be used from the past. We are stuck in an OIL processed country. They wont let us use Hemp, rattan, bamboo, Corn stalks, Stinging nettles(yep, was used to make Clothing), or anything else to make materials HERE.
      We could drop most of the plastics in cars to almost nothing, with rattan and Bamboo insted, but they dont give the Oil corps any money.

      We make tons of food, and ship out more then 60% to other countries, but who is making that money? Just drying and shipping out. And the corps in this country over produce for what reasons? We could use the lands for other things to Make it better, HERE.

      reply to this | link to this | view in chronology ]

      • identicon
        Anonymous Coward, 19 Oct 2020 @ 12:38pm

        Re: Re: Good Riddance

        Well, ECA, you have again put together a screed with some parts truth, some parts not so true.

        unless they dropped allot of pollution controls and requirements to CLEAN UP THEIR OWN MESS.

        Oddly, you're only partially wrong here, and in a direction I don't think you expected. Why do you imagine Comprehensive Environmental Response, Compensation, and Liability Act of 1980 (CERCLA) law was enacted? Because cleanup costs far exceeded some of these company's ability to clean up. (Sometimes especially after having been looted by their owners.) So I call you wrong ... in that in some cases environmental cleanup costs should be estimated and the company required to post a bond. You can't require a "dead company" to do anything.

        And WE still have pollution from plastic imports that Corps think we want.

        ... as evidenced by our purchases. While the government may be able to create incentives to reduce (eg) plastics, there are tradeoffs, such as fuel costs, wages (for recycling or more complicated production), etc that have to be factored in too.

        They wont let us use Hemp, rattan, bamboo, Corn stalks, Stinging nettles(yep, was used to make Clothing), or anything else to make materials HERE.

        Hemp I will grant you. For the rest, citation, please? Don't recall any particular restrictions on bamboo curtains, rattan chairs, etc.

        And the corps in this country over produce for what reasons? We could use the lands for other things to Make it better, HERE.

        Sorry, but this is just trolling. You have, perhaps, heard of "balance of trade"? And second, converting farm land to non-farm uses, with few exceptions, means that land cannot be returned to farming later. Populations continue to grow. How do you propose to feed them? Soylent Green, perhaps? Converting farmland is short sighted. But then, at the rate we are draining aquifers and losing topsoil, farmland loss may be inevitable.

        reply to this | link to this | view in chronology ]

        • identicon
          Anonymous Coward, 19 Oct 2020 @ 5:31pm

          Re: Good Riddance

          Populations continue to grow. How do you propose to feed them? Soylent Green, perhaps?

          Sounds like A Modest Proposal to me!

          reply to this | link to this | view in chronology ]

          • icon
            Scary Devil Monastery (profile), 22 Oct 2020 @ 12:09am

            Re: Re: Good Riddance

            "Sounds like A Modest Proposal to me!"

            Most excellent, good sir. The House will hear it right after the Candle Maker's Petition on natural lighting. With but three swift strokes we solve multiple issues of overburdened single parents, households with food insecurity, and the ailing pains of industry.

            reply to this | link to this | view in chronology ]

    • icon
      Scary Devil Monastery (profile), 22 Oct 2020 @ 12:04am

      Re: Good Riddance

      "Americans would be much better served by increased tariffs instead."

      ...say what now? Are you aware that you're advocating the use of trade wars as a potential net benefit? That's not Jim Jones kool-aid you've been drinking, you've been chugging from Trump's chlorox bottle.

      I'm with you as far as "corporate subsidies bad" - a free market doesn't exist if singular corporations have to be held up by tax money and/or Red Flag Act.

      Tariffs, however, is scorched ground. Pyrrhic warfare only really usable in a targeted fashion after determining just how bad your own country will get hit as compared to the nation you're really targeting. Imposing tariffs is an act of desperation you use when you find a significant sector of your own industry can no longer compete with foreign competitors and you are desperate enough to engage in an act of you and the competitor country taking turns to shoot each other's industries in the nutsack until hopefully the other guy folds.

      "...and it can generate revenue instead of wasting it."

      It really can't. I'm not sure if you're trolling or if your case of dunning-kruger has moved from free speech issues to cover a wider range of topics, but Trump's "Trade wars are good and easy to win" only makes sense if you are that one industry reaping benefits rather than, say, the rest of the country taking the bullet.

      What you were actually saying was; "Americans would be much better served burning their houses down rather than run the risk of being robbed".

      reply to this | link to this | view in chronology ]

  • icon
    Stephen T. Stone (profile), 19 Oct 2020 @ 11:11am

    “The Art of the Deal”, indeed.

    reply to this | link to this | view in chronology ]

    • identicon
      Bobvious, 19 Oct 2020 @ 2:51pm

      Re:

      That should be "The Dart of the Eel", all about a slimy character who exhibits randomness and rapidly moving from one position to another.

      reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 19 Oct 2020 @ 11:40am

    "Victory"

    ... I won't be surprised when Donny T. (bagged) claims this as a victory... afterall, if you look at it from a business point of view (that point of view being Foxconn's), it was a huge profitable success!
    For everyone else, not so much, but it's all a matter of perspective!

    I just hope (pray even) that we don't get four more years of Donny's Great America (cause most of know it's not at all great)

    reply to this | link to this | view in chronology ]

  • This comment has been flagged by the community. Click here to show it
    identicon
    Sad Lee Marginalized, 19 Oct 2020 @ 11:42am

    Greenwald refutes: (Yes, I know wrong topic: the one is locked!)

    ... That actions by gigantic corporations are constitutional does not mean that they are benign.

    Also "Constitutional" -- as determined by lawyers -- doesn't mean that People must sit silently ahd be oppressed. America is explicitly founded on moral principle of individual humans having inalienable Rights which sum up to FAIRNESS regardless of wealth or status. -- Don't nag me that originally included slavery because I'm about to refute you: else Abolishment must have stopped with Supreme Court decisions, and neither would the Civil Rights Movement have any validity. The labor movements and anti-trust actions of last century were exactly to wrest arbitrary power from The Rich and their giant corporations.

    But legalistic masnicks wish a return to royalism, just with corporate fronts. Masnick explicitly views even 1A as empowering the Rich to rule over the rest. While claiming he's so for Free Speech that urges Facebook to host videos of murders, he doesn't want neutral hosting of Public Forums in mere text! Masnick isn't wishing for the gov't to quit harassing corporations, he wants the gov't to confer POWER on them!

    State censorship is not the only kind of censorship. Private-sector repression of speech and thought, particularly in the internet era, can be as dangerous and consequential. Imagine, for instance, if these two Silicon Valley giants united with Google to declare: henceforth we will ban all content that is critical of President Trump and/or the Republican Party, but will actively promote criticisms of Joe Biden and the Democrats.

    reply to this | link to this | view in chronology ]

    • This comment has been flagged by the community. Click here to show it
      identicon
      Sad Lee Marginalized, 19 Oct 2020 @ 11:43am

      Re: Greenwald refutes: (Yes, I know wrong topic: the one is lock

      It has been astonishing to watch Democrats over the last twenty-four hours justify this censorship on the grounds that private corporations are entitled to do whatever they want. Not even radical free-market libertarians espouse such a pro-corporate view. Even the most ardent capitalist recognizes that companies that wield monopoly or quasi-monopoly power have an obligation to act in the public interest, and are answerable to the public regarding whether they are doing so.

      In his New York Times op-ed last October, the left-wing expert on monopoly power Matt Stoller described Facebook and Google as "global monopolies sitting astride public discourse," and recounted how bipartisan policy and legal changes designed to whittle away antitrust protections have bestowed the two tech giants with "a radical centralization of power over the flow of information." And he warns that this unprecedented consolidation of control over our discourse is close to triggering "the collapse of journalism and democracy."

      Greenwald supports my point that this is government-conferred power, not arising out of even their de facto market monopoly (see above):

      Beyond that, both Facebook and Twitter receive substantial, unique legal benefits from federal law, further negating the claim that they are free to do whatever they want as private companies. Just as is true of Major League Baseball - which is subject to regulation by Congress as a result of the antitrust exemption they enjoy under the law - these social media companies receive a very valuable and particularized legal benefit in the form of Section 230 of the Communications Decency Act, which shields them from any liability for content published on their platforms, including defamatory material or other legally proscribed communications.

      reply to this | link to this | view in chronology ]

  • This comment has been flagged by the community. Click here to show it
    identicon
    Sad Lee Marginalized, 19 Oct 2020 @ 11:43am

    THE summary quote:

    No company can claim such massive, unique legal exemptions from the federal law and then simultaneously claim they owe no duties to the public interest and are not answerable to anyone. To advocate that is a form of authoritarian corporatism: simultaneously allowing tech giants to claim legally conferred privileges and exemptions while insisting that they can act without constraints of any kind.

    Greenwald states was CENSORSHIP NOT MODERATION:

    The grave dangers posed by the censorship actions of yesterday should be self-evident. Just over two weeks before a presidential election, Silicon Valley giants - whose industry leaders and workforce overwhelmingly favor the Democratic candidate - took extraordinary steps to block millions, perhaps tens of millions, of American voters from being exposed to what purports to be a major expos‚ by one of the country's oldest and largest newspapers.

    Facebook is not some benevolent, kind, compassionate parent or a subversive, radical actor who is going to police our discourse in order to protect the weak and marginalized or serve as a noble check on mischief by the powerful. They are almost always going to do exactly the opposite: protect the powerful from those who seek to undermine elite institutions and reject their orthodoxies.

    reply to this | link to this | view in chronology ]

  • This comment has been flagged by the community. Click here to show it
    identicon
    Sad Lee Marginalized, 19 Oct 2020 @ 11:45am

    Techdirt is so small a site, doesn't matter where I drop these!

    The prior topic is LOCKED. I got ONE comment in, then completely blocked.

    You should DROP that tactic. It doesn't promote discussion as you solicit with plain HTML form. You are violating your own form contract.

    reply to this | link to this | view in chronology ]

    • icon
      Stephen T. Stone (profile), 19 Oct 2020 @ 12:58pm

      I’m sorry that your ISP/VPN/Tor node are apparently trying to save what’s left of your mental health after a decade of trolling this site over a mediocre insult. But that’s no reason to lie about comments sections on Techdirt being locked.

      reply to this | link to this | view in chronology ]

      • icon
        Scary Devil Monastery (profile), 22 Oct 2020 @ 12:14am

        Re:

        "... after a decade of trolling this site over a mediocre insult."

        Not just this site. Poor old Baghdad Bob's made it his life's work to troll Torrentfreak (until they started demanding logins) and this site. But everything has a silver lining;
        Most people, once they grow old and start wondering about the legacy they left behind will have to ponder well what they'd consider the apex of their work. Not so Baghdad Bob who may with pride recall the apex of his existence which appears to be that venomous diatribe where he called down the holy wrath of prison rape on every "aspie" on Techdirt for daring to mortally wound his ego by interjecting truthful rebuttals.

        reply to this | link to this | view in chronology ]

  • This comment has been flagged by the community. Click here to show it
    identicon
    Sad Lee Marginalized, 19 Oct 2020 @ 11:46am

    Oh, look! It's a 3-name ZOMBIE with 6.5 year gap to 2014!

    eMark or mark or 4pcwhisperer: 19 (3) 6.5 year gap after first; Mar 12th, 2014

    https://www.techdirt.com/user/4pcwhisperer

    Masnick's astro-turfing is much reduced due to my efforts to expose it, and that they ran through dang near EVERY old account! -- Note that almost none of those have continued, except for:
    Scary Devil Monastery: now at 5,122 comments! (special case!) resumed 8 Aug 2018 after 65 month gap from its first! 1 Mar 2013 https://www.techdirt.com/user/perge74
    So ardent fanboy yet waited over FIVE YEARS after first comment? And is known to be highly interested in topic because states recognizes someone's views from TorrentFreak? BALONEY! It's Masnick's astro-turfing, and from style, is another sock-puppet of Timothy Geigner.

    reply to this | link to this | view in chronology ]

    • identicon
      Anonymous Coward, 19 Oct 2020 @ 11:52am

      Re: Oh, look! It's a 3-name ZOMBIE with 6.5 year gap to 2014!

      Totally normal conspiracy nonsense here.

      reply to this | link to this | view in chronology ]

      • icon
        That One Guy (profile), 19 Oct 2020 @ 11:55am

        That's Woody in a nutshell, deranged, dishonest and perpetually claiming victimhood.

        reply to this | link to this | view in chronology ]

        • icon
          Scary Devil Monastery (profile), 22 Oct 2020 @ 12:29am

          Re:

          What I really don't get is why he'd call that eMark guy a Masnick astroturfer? The few comments I've seen from that guy is where he directly targets Mike.

          But I guess for Baghdad Bob astroturfing both sides of the debate isn't a logical showstopper for his conspiracy theory.

          reply to this | link to this | view in chronology ]

    • icon
      Scary Devil Monastery (profile), 22 Oct 2020 @ 12:26am

      Re: Oh, look! It's a 3-name ZOMBIE with 6.5 year gap to 2014!

      "Masnick's astro-turfing is much reduced due to my efforts to expose it..."

      As in that you brought up every name on the list of people who ever had anything to say against you and thought that a comment hiatus had to be sock-puppetintg astroturfers rather than, say, real life making people reprioritize their spare time?

      "And is known to be highly interested in topic because states recognizes someone's views from TorrentFreak?"

      Well, I came here from TF because the topics are the same ones I've always been interested in online. But do go on and expound your conspiracy theory on how every one of the people who persistently smack your garbage down is Mike Masnick. 🤣

      Here, have a spontaneous comment in my mother tongue; Gör dig själv en tjänst, torka fradgan från käften, ta även du fem års semester från datorn och ring - direkt - en skicklig psykolog.

      reply to this | link to this | view in chronology ]

  • icon
    That One Guy (profile), 19 Oct 2020 @ 12:05pm

    You know, like how anyone else would be treated for defaulting..

    And this is why you set hard limits on any deals with a company, with regular checks to make sure they're holding up their end of the bargain and real penalties in place and enforced for not doing so.

    It should not have taken several years for the state government to realize that for all the subsidies and tax breaks they were throwing at Foxconn the company had little to nothing to show for it, at most the entire thing should have been reevaluated at the end of the first year with the hammer brought down and outside auditors brought in to find out just what and where the company was spending all their money, with it made crystal clear that if the company wanted anything more they were going to have to meet certain milestones and show that they were earning it.

    reply to this | link to this | view in chronology ]

    • identicon
      Anonymous Coward, 19 Oct 2020 @ 1:31pm

      Re: You know, like how anyone else would be treated for defaulti

      Eh? We did do that, though. According to the Verge article, "this would have been the first installment of the nearly $3 billion in refundable tax credits that made up the bulk of former Gov. Scott Walker’s record-breaking subsidy package." And, "In 2018, Foxconn needed to hire at least 260 eligible employees, and Foxconn fell so far short of that goal it didn’t apply for subsidies."

      We did spend some money on infrastructure, but that's not really the same as a subsidy.

      reply to this | link to this | view in chronology ]

  • identicon
    rasz_pl, 19 Oct 2020 @ 12:54pm

    But look on the bright side, at least they got to evict a bunch of people.

    reply to this | link to this | view in chronology ]

  • identicon
    Bobvious, 19 Oct 2020 @ 3:19pm

    AI 8K + 5G ecosystems

    reply to this | link to this | view in chronology ]

  • icon
    TheForumTroll (profile), 20 Oct 2020 @ 3:31am

    China

    Wonder how this would've played out had Foxconn been from PRC.9

    reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 20 Oct 2020 @ 5:22am

    I find it amazing how conservatives proclaim their adherence to free market capitalism and their abhorrence of socialism, all the while promoting corporate subsidies, handouts and special deals.

    Socialism for the corporate world, free market capitalism for the masses.

    reply to this | link to this | view in chronology ]


Add Your Comment

Have a Techdirt Account? Sign in now. Want one? Register here



Subscribe to the Techdirt Daily newsletter




Comment Options:

  • Use markdown. Use plain text.
  • Remember name/email/url (set a cookie)

Close

Add A Reply

Have a Techdirt Account? Sign in now. Want one? Register here



Subscribe to the Techdirt Daily newsletter




Comment Options:

  • Use markdown. Use plain text.
  • Remember name/email/url (set a cookie)

Follow Techdirt
Insider Shop - Show Your Support!

Essential Reading
Techdirt Insider Chat
Recent Stories

This site, like most other sites on the web, uses cookies. For more information, see our privacy policy. Got it
Close

Email This

This feature is only available to registered users. Register or sign in to use it.