Opinion

David Cay Johnston

In New York, gifts circumvent a ban

David Cay Johnston
Nov 29, 2011 16:26 UTC

By David Cay Johnston
The opinions expressed are his own.


Taxpayers can expect ever more picking of their pockets by businesses with political clout thanks to the Nov. 21 decision by Judge Theodore Jones and four colleagues on the New York Court of Appeals.

At issue is $1.4 billion in state gifts whose primary beneficiary is a microchip maker, GlobalFoundries, a company controlled by Abu Dhabi’s hereditary ruler, Sheikh Khalifa bin Zayed Al Nahyan, one of the wealthiest people ever. The gifts, labeled economic development grants and made through a state-sponsored corporation, work out to about a million dollar subsidy per job at the plant near Albany.

The New York Court of Appeals said the 50 taxpayers who sued over the deal and over gifts to apple and wine trade associations have no standing to challenge the gift because it is proper.

While this case concerns only New York, it illustrates how corporate socialism has become our de facto economic policy and how the ideal of competitive markets and self-reliance are fading in significance.

State and local gifts to corporations now run at least $70 billion per year nationwide, according to an estimate by Professor Kenneth Thomas of the University of Missouri-St. Louis.

A gift, from NY to Abu Dhabi

David Cay Johnston
Nov 1, 2011 16:37 UTC

The author is a Reuters columnist. The opinions expressed are his own.

How does being taxed to give money to the oil-rich kingdom of Abu Dhabi and its hereditary ruler strike you?

The cost, if you live in New York State, comes to about $1.4 billion, or roughly $190 per household, for an economic development deal with a privately held company called GlobalFoundries to build a microchip plant near Albany.

As you ponder this forced transfer from you to the chip-making giant, which is controlled by Abu Dhabi‘s ruler Sheikh Khalifa bin Zayed Al Nahyan, keep in mind that Abu Dhabi says its citizens enjoy the world’s third-highest per capita income, a third higher than Americans’.

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