Investment In Public Education Will Bring Companies To North Carolina
Governor McCrory has been telling the legislature that he needs more tools (read: money) for business recruitment. McCrory and many Republicans in the legislature want North Carolina to get into the business incentive bidding war that other states are involved in. That means throwing millions, if not billions, of dollars at multinational corporations that make billions in profit each year.
As a recent blog for the Charlotte Observer points out though, North Carolina has been consistently ranked as a great place to do business, without getting into expensive bidding wars with neighboring states. North Carolina instead invested in public education and infrastructure, creating a desirable environment for businesses and employees alike. Now we’re ranked as the worst state for teachers in the country and having problems recruiting major employers. It’s going to cost money to fix, it’s just a matter of whether we should spend it on big business or public education.
Chalk up another loss on the economic development front for North Carolina.
Mercedes-Benz, after considering several cities in the state, is reportedly taking its U.S. headquarters to Atlanta. The luxury automaker joins a growing list of prestigious business brands who have thought about moving major operations to the Tarheel State, only to bypass us for other suitors.
Last year, a $107 million offer couldn't land Toyota's U.S. headquarters in Charlotte. They picked Plano, Texas. A whopping $683 million offer couldn't land Boeing's new 777x jetliner plant, which Washington state secured with a massive $8.7 billion incentives deal, then the largest corporate tax break in U.S. history.
Also in the last two years, the state lost out to Lancaster County on a $218 million Chinese textile plant and to Chester County on a $560 million tire plant. S.C. officials offered an incentives deal 10 times larger than North Carolina for the textile project and a deal with tens of millions more in tax savings on the tire project.
North Carolina used to have something like that California approach to economic development.
We didn't sweat the bidding wars. We invested in schools and universities to make them among the strongest in the region. We developed a reputation, as the New York Times put it in a 2013 editorial, "as a beacon of farsightedness in the South." Despite a legacy of not offering the biggest pots of money to relocating corporations, we still ranked at or near the top of business climate and job creation lists for much of the past two decades.
Nowadays, we're struggling to keep our teacher pay respectable and keep teachers from leaving the state. Lawmakers have a decision to make: either go all-in on the bidding war, as the governor seems to be asking, or increase funding for the state's true job creators -- its schools and universities. Our recent history suggests the latter economic development model works just fine.