The News-Press has reported that “Florida taxpayers and donors have committed $1.6 billion over the past decade to lure research firms - about $800,000 for every employee the companies will eventually hire.”
Those are good paying jobs at around $55K per year, so basically we the people of the state of Florida have paid for all the salaries for over a decade of each employee of the research firms we have tried to entice to come to Florida. Of course most of these jobs are not for local Floridians, but for people we will import into the state to fill the jobs.
This is stupidity and a primary example of too much government. Florida has attracted eight laboratories since 2003 with eight- and nine-figure incentives. These institutions, which recently became operational, have hired 883 of the 2,033 people they have pledged to employ over the next decade, according to their reports to the state. The government is trying to “manufacture” research clusters. The history of such clusters is dubious at best.
Vivek Wadhwa, a Duke University researcher who studies trends in technology enterprises, says most successful clusters grow naturally, not through government direction. "Nearly all such clusters worldwide have failed," Wadhwa said. "It takes years for this to become obvious and, by then, political leaders have moved on and real estate developers have reaped their bounties."
We do have a prime example of a “Cluster” in Florida that has naturally occurred and is very profitable. It happened not with donations by the Florida taxpayers but with limited government. It’s called Orlando Tourism, Disney, Universal, Sea World, I-Drive, and stretches down the I-4 corridor to Bush Gardens in Tampa. This is a prime example of a cluster that grew naturally, hired thousands of people, and didn’t cost the taxpayers hundreds of thousands of dollars per job.
Cluster building is corporate welfare, and a waste of taxpayer money. Models for chasing business away and attracting business exist in the USA. California is hemorrhaging business they are moving away as fast as they can pack up. Texas is growing even in this bad economy. The difference is the size of government. In Texas they work actively at keeping government small, and allowing business to thrive or perish on their own. In California, they tax and regulate and subsidize business to death.
We don’t need to bribe business with tax dollars to get them to come to Florida, we need to create a long term environment where they are not so burdened that other places look better. Wasting tax dollars on business bribes (subsidies and incentives), makes all the citizens of Florida poorer, and provides incentives for graft and political favoritism. We especially need to not waste tax dollars trying to artificially create a technology cluster. Consider the actions of the California government, it didn’t create Silicon Valley. Silicon Valley naturally arouse from the people of that area, attracting the best and brightest minds in technology. Seeing profits and money poor in, the government took action which has resulted in Silicon Valley’s death. Additional government regulations, taxes, and laws have resulted in such huge decreases in profitability for all industries in that area they have and are moving off shore and to other states.
Biotech clusters like the research triangle at Raleigh-Durham-Chapel Hill resulted from the natural growth around universities, medical schools, and supporting corporations moving to where people and environment are conducive to growth. Florida’s latest effort is the proposed $260 million state and local cash incentive for Maine-based Jackson Laboratory to come to eastern Collier County. There is no university/medical school/engineering environment in Collier County like there is around FAU or UCF. Jackson Lab plans to hire up to 244 people over the next decade. Mike Hyde, Jackson Lab vice president for advancement, estimated that about a third of total employees may be hired from the state or region. Does anybody besides me see the stupidity in spending $260 million tax dollars to get 81 Floridian jobs? We could give those 81 local people $321,000 a year for 10 years or we could give 500 people over $50K per year for 10 years.
Suppose you buy into the idea that those 244 jobs will create a trickledown effect and benefit the economy of Collier County and Florida in excess of the $260,000,000 tax dollar investment. That the temporary construction jobs, and auxiliary spending will be a good investment of Florida tax dollars. That doesn’t make Jackson Laboratory a good investment. Jackson Laboratory Florida will study human disease, the effect of the human genome on such diseases and how to develop “personalized” medical treatments and diagnoses based on these factors. “Personalized” medical treatments and diagnoses is very expensive, in a free market those who could afford Cadillac insurance, would be able to afford such treatment. With the passage of Obama Care, and the recess appointment of Dr. Donald Berwick, we are about to enter into European style socialism. “Obama made the recess appointment because a public confirmation hearing in the Senate would have made Berwick -- who has openly advocated the redistribution of wealth as part of a health care plan -- “unconfirmable,” said Sen. John Barrasso (R-Wyo.).
In a June 2009 interview with Biotechnology Healthcare, Dr. Donald Berwick said: “We can make a sensible social decision and say, 'Well, at this point, to have access to a particular additional benefit [new drug or medical intervention] is so expensive that our taxpayers have better use for those funds.' We make those decisions all the time. The decision is not whether or not we will ration care--the decision is whether we will ration with our eyes open."
Like Britain health care will be managed (rationed) based upon the worth of a person to society. Do you think that expensive “personalized” medical treatments and diagnoses of Jackson Laboratory will fit into Obamacare? If Collier County is such a good place to build a biotech lab, then Jackson Laboratory would do it without huge cash incentives. The research in Collier will largely be computer analysis of genetic information, according to lab officials. With current technology, this type of work is not necessarily location specific, the question to ask is without the cash incentives would Jackson Laboratory be expanding and doing this work collier county? Investing $260Million of cash incentives, without even stock ownership, in a company whose product may not be viable because of promised government rationing, seems to be a very stupid use of Florida tax dollars.
Why should the people of Florida subsidize Jackson Laboratory, to create a “cluster”, when virtually all such clusters worldwide have failed, and the passed and promised regulations of Obamacare will severely curtail the use of Jackson Laboratories services?