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by dionidium 1862 days ago
We do this kind of weird dance in which we create subsidies to incentivize desirable behavior and then when it works and we get more of the desirable behavior we complain about the handouts.

I understand that democracy implies multiple constituencies, not all of which agree on the need for any particular policy (and so arguments about the necessity of specific subsidies are reasonable and inevitable), but it's always worth remembering that we offer these subsidies because we want to encourage the behavior that's tied to the them. It's not an accident or a secret handout.

It's quid pro quo.

2 comments

It's a race to the bottom, though. The entire premise of subsidizing e.g. an Amazon datacenter is that Amazon needs a datacenter, and it's going to be built somewhere, so you need to offer them a lot of money if you want the jobs in your state/city. It's not a question of if the "desirable behavior" of opening a datacenter and "creating a lot of jobs" is going to happen or not, just a question of where. So there's this whole competition between locations to offer the greatest possible tax break, but it doesn't actually have any bearing on Amazon's overall desirable behavior. We're just giving them tax breaks for doing their normal business.
Sure, and I broadly agree that there's a collective action problem here; it's just that accurately understanding and addressing that problem requires a different level of analysis that's removed from raw anger about "handouts."
Sure, I agree with that.
Agreed. You get what you incentive for. You get what you optimize for. Jobs and housing will always be incentivized. because they are needed everywhere. It is always why corporate taxes are setup to be paid after expenses and personal taxes are setup to be paid before expenses (generally).