(EDITOR’S NOTE, 1/30/19, 2:18 PM ET: This article previously stated Foxconn is a Chinese company, when it is in fact Taiwanese. We have corrected the error.)
Before he got voted out of office in November, former Wisconsin Governor Scott Walker (R) inked a major deal with Taiwanese tech giant Foxconn to build a sprawling factory in the Badger State.
Now, it looks like the jobs Foxconn promised in exchange for approximately $4 billion in tax breaks will never come.
Initially, Foxconn’s proposed factory in Wisconsin would have built advanced liquid crystal display screens. However, the company now says it will be building the screens overseas, where labor is cheaper. Now, Foxconn is only planning to have a “technology hub” employing researchers to help produce specialized products for hospitals and other industries.
Last summer, Foxconn said it would hire roughly 13,000 people to work at the new $7 billion plant, which would be built in the Village of Mount Pleasant in Racine County, near the Illinois border. Foxconn chairman Terry Gou said that the plant would eventually create up to 50,000 new jobs in the region. The Taiwanese tech supplier said most of the jobs would be blue-collar manufacturing jobs, paying an average of $53,000/year. Now, Foxconn says its Wisconsin workforce may be just 1,000 people.
In addition to securing $3 billion in tax breaks from the State of Wisconsin over a 15-year period, Foxconn also got $764 million from the city and county hosting it, which included local and county officials buying the land the factory would be built on and gifting it to Foxconn. State and local governments also agreed to spend almost $400 million to road improvements to accommodate Foxconn, and the federal government would have spent $164 million on adding two new lanes to Interstate 94. The local electric company in the region also promised to upgrade its infrastructure to provide the plant with adequate power, and raised costs on five million ratepayers to the tune of $140 million.
Foxconn has a long history of lying to governments in order to get tax breaks and other benefits from politicians. In Pennsylvania, the company once promised to invest $30 million to hire 500 workers in Central Pennsylvania in 2013. However, the company failed to follow through on its promise.
But the factory was never built. The jobs never came. “It just seemed to fade to black” after the announcement, recalled a local official. It was the start of a mystery, created by a chief executive known to promise projects all over the world that never quite pan out. Yet few people seem to notice. Foxconn and others continue to get credit for deals that never take place. In December, Pennsylvania’s economic development staff was still touting the $30 million factory that never was.
It remains unclear what will happen to the Foxconn tax breaks under new Wisconsin Governor Tony Evers (D). The former education superintendent ran radio ads during the campaign attacking Walker’s deal with the tech supplier, in which Wisconsin would take 25 years to recoup the money given to the Taiwanese tech company.
“Sounds good for Foxconn, but what’s in it for the rest of us? Just think if we invested that money in our schools instead,” Evers said in the radio ad.
Carl Gibson is a politics contributor for Grit Post. His work has previously been published in The Guardian, The Washington Post, The Houston Chronicle, Al-Jazeera America, and NPR, among others. Follow him on Twitter @crgibs or send him an email at carl at gritpost dot com.
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