In 2017, Trump and then-Wisconsin Governor (and Koch darling) Scott Walker announced that they would give Chinese manufacturing giant $3B in taxpayer subsidies to open the only flat panel display factory in the western hemisphere (the figure quickly grew to $4.1B), despite the company's long, documented history of lying to governments, sucking up subsidies, and never delivering the promised facilities or jobs.
And indeed, even as the state of Wisconsin was seizing family homes and bulldozing them to make way for the factory, the factory itself kept getting scaled back, and back, until the whole thing turned into a plan to buy some empty office buildings and do nothing with them, which was shady even by Foxconn standards.
The Foxconn chaos contributed to the Wisconsin governorship flipping, and the new governor Tony Evers has directed his state Department of Administration to commission a research report on salvaging the deal: that report, undertaken by Timothy J Bartik for the Upjohn Institute for Employment Research, is now live.
The report is clear: there is no way to salvage this deal. Either Foxconn has to return most of the cash it's already received and then follow through with most of the new facilities it promised, or the jobs that Foxconn creates in Wisconsin will cost the state more than could possibly be justified.
Indeed, this has been the case from the start, but Foxconn contracted with a leading firm of grift-enablers, EY (formerly Ernst & Young), to present a misleading business-case to justify the deal in the first place. In the cold light of objective assessment, the deal is revealed for the grift it was from the start.
The analysis comes five months after a Foxconn executive met with Evers and expressed interest in revising the company’s contract with the state. Foxconn hasn’t said what it would push for, but Evers administration documents obtained by The Verge summarize the meeting and the company’s broad requests: updating the contract to reflect the smaller factory, including additional Foxconn subsidiaries, and extending the period Foxconn can qualify for capital investment tax credits.
Such changes make sense for Foxconn. The company has radically scaled back its plans and likely wants assurances that it won’t be found in breach of contract. But Evers was critical of the deal during his campaign and would likely be reluctant to agree to these changes without getting concessions of his own. In this context, the new economic impact assessment can be seen as setting a new baseline for further negotiations.
Even fixing Wisconsin’s Foxconn deal won’t fix it, says state-requested report [Josh Dzieza/The Verge]