Google Wants $15 Million in Tax Breaks to Build a Data Center in Minnesota

Google recently announced plans to build a $600 million data center in Becker, Minnesota. The project will come at a cost, though, as the tech behemoth is seeking $15 million in tax breaks.

“This will generate a lot of local economic activity that will benefit not only the city and the county, but also the state and the region,” Sherburne County Administrator Steve Taylor tells Minnesota Public Radio.

The development drew a chorus of cheers from sustainable energy advocates and from local politicians, as Google would rely on renewable sources of power and create jobs. The latter feels especially urgent in the area, since two generating units at Xcel Energy’s Sherburne County Generating Plant are slated to shut down within the next seven years. Affectionately known as Sherco, the power plant has been a driving force in the community’s economic success.

Sherco currently produces 75 percent of the town’s tax revenue. Its successor, by contrast, will pay nothing in city or county taxes for two decades.

Google is promising to bring 50 full-time positions to the area. The company also projects that it will create 2,300 jobs during the 18–24 month construction window—a far shorter period than the 20 years of tax relief they’re requesting. After construction wraps, with 18 remaining years of tax abatement, there will be a $270,000 tax shortfall for every full-time position created.

And the deal might not be limited to tax breaks. State Sen. Andrew Mathews (R–Milaca) and state Rep. Shane Mekeland (R–Clear Lake) recently introduced a bill to provide an additional $20.1 million in state bonds to give the Becker Business Park—where the data center would be built—a facelift.

Google certainly isn’t the first to leverage its star power this way. Most recently, Amazon made headlines for landing a jaw-dropping $2 billion tax credits and other inducements for promising to set up shop in New York and Virginia. They’ve since pulled their location in Queens after facing opposition from local politicians, but they’re still poised to receive $573 million in tax breaks from the Commonwealth.

Such incentives are typically justified by politicians as a crucial way to stimulate the economy. But do they even have the intended effect? Not so, according to a recent study by Timothy Bartik from the W.E. Upjohn Institute for Employment Research.

“Incentives do not have a large correlation with a state’s current or past unemployment or income levels or with future economic growth,” Bartik writes. He notes that governments often fail to evaluate a company’s impact—how many jobs it creates, how many investments it draws, etc.—but instead give the money uncritically. That can actually have a counterintuitive effect on productivity: Some businesses that receive incentives end up creating jobs at a slower rate than those without, because the subsidized companies are very rarely held to account.

Such businesses consider a multitude of reasons when picking a location, none of which typically pertain to promised incentives. As Richard Florida writes at CityLab, “companies typically select locations based on factors such as workforce, proximity to markets, and access to qualified suppliers”—and then a request for tax breaks follows.

That certainly seems to have been the case with Amazon, who received higher incentive offers from New Jersey (a total of $7 billion) and Maryland (a staggering $8.5 billion) but opted for Queens and Northern Virginia instead. A smaller payoff, yes—but perhaps those two areas offered more of what they needed. They’re both parts of thriving metroplexes that have the infrastructure and the highly educated workers the company requires.

Google has much in common with Amazon in that regard. While Becker is no budding metropolis, the town’s access to renewable energy suits the tech giant well. As Xcel shifts away from coal, it has offered to supply Google with dedicated wind energy—an alluring offer, as the company will need to power the 375,000 square foot data center for 24 hours, 365 days a year.

When Sherco shuts down its two generators, Google’s presence could certainly help turn things around. But 20 years of tax favoritism will only serve to make a poor community even poorer.

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New Study Finds Almost Half of Juul Starter Kit Buyers Quit Within 3 Month

A new study, based on a survey of about 7,700 Juul users, found that nearly half had quit smoking within three months of buying a starter kit, while the rest had reduced their cigarette consumption by an average of 52 percent. The survey results, reported in the Journal of Pulmonary and Respiratory Medicine, provide further evidence that e-cigarettes help smokers dramatically reduce their exposure to the toxins and carcinogens produced by tobacco combustion.

The survey, commissioned by Juul Labs and conducted by the Centre for Substance Use Research, started with 9,272 smokers who had bought starter kits online or from brick-and-mortar stores, of whom 7,721 responded to questions about their past-month smoking prior to the purchase and three months later. Forty-seven percent reported no smoking at all in the month before the follow-up. Among those who were still smoking, the number of cigarettes consumed during the previous month fell, on average, from 341 to 165, or from about 11 to about five a day.

E-cigarette skeptics frequently warn that people who use these products may continue to smoke even after they take up vaping, and these data confirm that dual use is common. But even if dual users do not eventually stop smoking completely, a 52 percent reduction in cigarette consumption is nothing to sneeze at. Another recent study found that smokers who switched entirely to vaping saw reductions in biomarkers of exposure to hazardous substances as big as people who stopped smoking without using e-cigarettes. Getting halfway there surely represents a significant improvement.

The researchers take a stab at translating these findings into estimates of Juul’s population-wide impact on cigarette consumption. If 20 percent of smokers use Juul, for example, that would represent 84 million fewer cigarettes smoked per month.

The sample in this study is self-selected, so you would not expect to see the same results in a group of randomly selected smokers. People who buy Juul starter kits are probably especially motivated to quit (or cut back) and especially likely to find that vaping is an adequate substitute for smoking. But a randomized study reported in January found that e-cigarettes were almost twice as effective in achieving smoking cessation as other forms of nicotine replacement.

In the real world, smokers will tend to gravitate toward the cessation methods that work best for them, so it’s important that they have a wide range of options. The Food and Drug Administration, which acknowledges the enormous harm-reducing potential of e-cigarettes, is nevertheless proceeding with a plan that will limit those options by restricting the availability of most e-liquid flavors.

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Lower Taxes May Have Helped Philadelphia Sign Bryce Harper

After a months-long courtship, the Philadelphia Phillies last week signed baseball superstar Bryce Harper to a record-breaking contract—and Pennsylvania’s relatively friendly tax environment may have helped seal the deal.

The Phillies will pay Harper $330 million over 13 years—the most expensive contract in Major League Baseball history—and Harper will net approximately $184 million after paying his due in federal, state, and local taxes, according to an analysis by Robert Raiola, director of the Sports and Entertainment Group, which helps athletes and celebrities with tax planning.

That’s a huge tax bill, but it’s smaller than what Harper would have owed had he signed with one of the two top bidders for him during this year’s free agent signing period. The San Francisco Giants reportedly offered Harper a 10-year contract worth $310 million—a higher annual salary than what the Phillies offered—but Harper would have netted only $161 million from that deal because of California’s higher taxes. In order to offer Harper as much in take-home pay as the Phillies did, San Francisco would have had to pay $340 million over 10 years.

The Los Angeles Dodgers also jumped into the Harper sweepstakes, reportedly offering the outfielder a four-year, $168 million contract. Harper would have netted $89 million from that deal, according to Raiola.

Only Harper and his agent know whether taxes played a role in the decision to sign with Philadelphia. But the prospect of pocketing an additional $23 million (and getting to play half his games in a much more hitter-friendly ballpark) would seem to be a strong incentive to pick Philadelphia over San Francisco.

He would hardly be the first athlete to make such a decision for such a reason. In 2014, one reason Trevor Ariza left the National Basketball Association’s Washington Wizards to sign with the Houston Rockets was because he “could pocket more money because the state doesn’t tax income,” The Washington Post reported at the time.

“As taxes rise in many states, no-income-tax states like Texas, Florida, Washington, Tennessee, and Nevada may become increasingly attractive to athletes, entertainers, and other high-income producers,” writes David Boaz, executive vice president at the Cato Institute.

Pennsylvania might not be on that list, but the state’s flat income tax of 3.07 percent makes it one of the more attractive places for highly paid athletes (or for not-so-highly-paid Average Joes) among states that do collect income taxes.

Professional athletes end up having to pay taxes in every state where they play, so Harper will still have to pay higher tax rates when the Phillies go on the road to visit California or New York or elsewhere. But he’ll save a significant amount by having half his games in Pennsylvania.

Meanwhile, Philadelphia charges workers a wage tax of 4 percent if they live inside the city; those who live elsewhere and work in Philadelphia pay only 3.5 percent. According to an analysis by The Philadelphia Inquirer, Harper could save $7.5 million over the course of his massive contract simply by choosing to live outside the city—something that really exposes the weird incentives created by Philadelphia’s wage tax, one of the highest such taxes in the country.

Harper’s situation is an extreme case, since most of us don’t have the luxury of figuring out how to avoid paying higher taxes on $330 million. But migration data consistently show that tax rates are at least part of the reason why people choose to live and work where they do. That’s part of the reason why high tax states like Connecticut are seeing an exodus of taxpayers and why Illinois struggles to attract investment.

If Harper’s contract pays off for Philadelphia in the form of a World Series championship, Phillies fans—including yours truly—might have to thank California lawmakers for making their state less attractive than Philadelphia, which is really saying something.

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Popular Defiance Will Kneecap Gun Laws in New Mexico: New at Reason

In New Mexico, the state’s governor is publicly feuding with county-level officials who, responding to grassroots anger at proposed gun measures, vow noncompliance if they become law. The evidence from similar spats in other states, writes J.D. Tuccille, suggests that government officials are once again poised to have their impotence demonstrated by people eager to disobey dictates from above.

“The gun-related measures have drawn opposition from all but a few of the state’s 33 county sheriffs,” the Albuquerque Journal notes. “In addition, at least 24 counties have passed ‘Second Amendment sanctuary’ ordinances in opposition to the legislation pending at the Roundhouse.”

In response, Gov. Michelle Lujan Grisham, a Democrat, slapped back at what she called “rogue sheriffs throwing a childish pity party.” That’s probably not the sort of language likely to win over the rebellious, largely rural residents to whom county officials are catering, Tuccille suggests.

View this article.

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Alaskan Officials Evict General Store’s Beloved Cat from Home of 6 Years

A jet-black, “slightly overweight” cat named Storm (or Stormy, depending on who’s talking), who “loves cat treats” as well as “a nice quiet evening at home with her newly captured Mousy,” is being evicted from her home of six years, a general store in Homer, Alaska. Blame the one unhappy member of the public who complained about the cat to the Alaska Department of Environmental Conservation (DEC).

“We did receive a complaint [about the cat],” Jeremy Ayers of the DEC’s Food Safety and Sanitation Program, tells the Homer News. An environmental health officer also witnessed the cat, he says, and “if an EHO sees it, they need to take action.”

Under the state’s food code, live animals, with the exception of service animals, seafood, and pet fish, are largely not allowed in Alaska food establishments.

The general store is owned by Sean Maryott and Diana Carbonell, who took in the cat in 2012 after its original owner, Kady-Lee Hackett, moved to Australia.

Despite concerns that the cat might be a health risk, some frequent customers say that couldn’t be further from the truth. “I’m in there every day, and it just seems like if the DEC is concerned about hygienics, having the cat there is a lot more hygienic than not having the cat there, because the cat keeps the rodent population down,” Al Breitzman tells the Homer News. Linda Chamberlain notes that state regulations might not always make sense to unique circumstances in less crowded parts of the state.

Some have drawn comparisons to Stubbs, a cat that would often visit both a convenience store and restaurant in Talkeetna, Alaska, where he was elected mayor in 1998. But according to Ayers, allowing Stubbs into those establishments was a violation of state food code as well.

Storm will now live with Maryott’s sister, Bridget. Still, as Hackett notes on Facebook, “she doesn’t deserve to have to go through this stress or to have to be rehomed at her age.” Hackett says she’s written to the governor, in hopes that he’ll intervene to let the cat stay at the store.

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‘Everyone’ Here Is a Socialist Except Most Americans: Reason Roundup

Are tax cuts socialist? Is everyone? “Until very recently, it wasn’t that socialism was toxic in a red-scare way. It was irrelevant, in a dustbin-of-history way,” writes Simon van Zuylen-Wood in new cover story for New York magazine. “But then came Bernie Sanders’s 2016 candidacy,” a boost in Democratic Socialists of America (DSA) membership, the Chapo Traphouse podcast, and Rep. Alexandria Ocasio-Cortez (D–N.Y.).

These days, the magazine suggests, “everyone” has “become a socialist.”

Now, I’m not one to begrudge a bit of editorial hyperbole. But the New York coverline—a more accurate and boring rendering of which would be something like “socialism is trendy again”—provides a good jumping off point for the latest numbers on Americans, socialism, and capitalism.

In a national NBC/Wall Street Journal poll released yesterday, respondents were asked about what traits are desirable in a presidential candidate and what traits they could do without. Overall, most people were comfortable with “an African-American” (87 percent), “a white man” (86 percent), or “a woman” (84 percent) becoming president. Majorities were comfortable with “a person who is gay or lesbian” (68 percent), “an independent” (60 percent), “someone under 40” (58 percent), “a business executive” (56 percent), or “an evangelical Christian” (54 percent) winning the presidency.

And a near-majority (49 percent) said they would be OK with a Muslim president of the United States.

Trailing significantly behind in acceptance were two traits. Only 37 percent of respondents said they would be OK with a president over 75 years old, and just 25 percent said they would be OK with a president who is a socialist.

Another poll question asked whether respondents viewed the term socialism positively. Just 18 percent did.

A full 50 percent viewed it negatively—a near mirror split from respondents’ views on capitalism. Half of those surveyed said they viewed capitalism positively, versus 19 percent who viewed it negatively.

The poll reflects other relatively recent data, which continues to show strong support for free markets even as socialism’s star rises in certain younger circles. For instance, a 2016 Harvard poll found 42 percent of 18- to 29-year-olds had a positive view of capitalism, while 33 percent had a positive view of socialism.

As demonstrated in the 2014 Reason-Rupe poll, and as others have also shown since, support for concepts like capitalism and socialism often shifts drastically depending on how the terms are defined or the specific phrasing of poll questions. Still, there are limits to linguistic fluidity, and some socialist-identified pundits are definitely pushing them. For instance, here’s Jemele Hill suggesting that “tax cuts” are a socialist goal:

ELECTION 2020

Presidential run not on Amash’s radar. Rep. Justin Amash (R-Mich) told CNN’s Jake Tapper yesterday that he would “never anything out” when it comes to running as the Libertarian presidential nominee in 2020. Alas, he added that “that’s not on my radar right now.”

Amash also criticized our polarized political culture:

“Right now we have a wild amount of partisan rhetoric on both sides,” he said. “And Congress is totally broken; we can’t debate things in a clear way anymore. Everything has become ‘Do you like President Trump?’ Or, ‘Do you not like President Trump?’ And I think that we need to return to basic American principles, talk about what we have in common as a people—because I believe we have a lot in common as Americans—and try to move forward together, rather than fighting each other all the time.

“Sounds like a platform,” commented Tapper.

Meanwhile, in the Democrats’ dominion, former Colorado Gov. John Hickenlooper is running.

FREE MINDS

Who needs Russian bots when you’ve got TV reporters? The Momo hoax isn’t just being reported “as fact” by a lot of local TV stations; it’s “seemingly embraced by local news sources,” notes Nieman Lab.

“The Momo challenge is a fascinating example of how a fake story spreads in real time with the assistance of the U.S. mainstream media (no Russian trolls required),” writes Laura Hazard Owen. “I set out to name and shame some of the many local TV news stations that are spreading this story. There are many more examples out there — if you want to share one, DM me.”

FREE MARKETS

Huawei to sue the U.S. government. “The Chinese electronics giant Huawei is preparing to sue the United States government for banning federal agencies from using the company’s products, according to two people familiar with the matter,” reports The New York Times. “For many years, United States officials have said that Huawei’s telecommunication equipment could be used by Beijing to spy and disrupt communication networks. The company has denied the allegations, but major wireless carriers such as AT&T and Verizon have effectively been prevented from using Huawei’s equipment as a result.”

QUICK HITS

• Sex workers and activists aren’t buying the idea that Sen. Kamala Harris (D–Calif.) has actually changed her views on prostitution.

• Harris endorses statewide rent control:

• NBD, just our government bragging about being an “Angel of Death”…

• Some Florida media are starting to look skeptically at the Robert Kraft/Asian massage parlor investigation.

• “For as long as I’ve been in Washington, CPAC was the Creature Cantina of conservatism,” writes Jonathan V. Last at The Bulwark in a defense of its coverage of this past weekend’s event.

• How not to address poverty:

• This seems like a cool project (learn more and lend support here):

Many documentaries have been made about sex work and the fight for sex workers’ rights. Few center the narratives and contributions of Black and Brown people, how they have shaped this industry and an entire movement. We are hoping to change that with The Heaux History Project, a documentary series created by Black and Brown sex workers, centering Black and Brown sex workers.

• Rep. Thomas Massie stands with Sen. Rand Paul in opposing President Donald Trump making an emergency declaration:

• Megan McArdle with a good Twitter thread on why maybe calling out “Green New Deal” proponents for taking cars everywhere isn’t so silly. Start here:

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Former Clinton Campaign Staffer Accuses Bernie Sanders of Failing to Mention Race, Gender in Speech That Explicitly Mentioned Race, Gender

SandersOne of the more straightforwardly dishonest aspects of the 2016 Democratic presidential primaries were certain Hillary Clinton supporters’ efforts to portray rival Bernie Sanders as out-of-touch with black and female voters, even though his record on race and gender issues was at least as progressive as Clinton’s.

Some Clinton partisans are still pushing this narrative. Enter Zerlina Maxwell, a former communications staffer for the 2016 Clinton campaign and current director of progressive programming at Sirius XM Radio. Maxwell, a black woman, appeared on MSNBC to react to Sanders’ campaign kick-off speech at Brooklyn College on Saturday. She was not impressed.

“To be very serious about it, I clocked it,” said Maxwell. “He did not mention race or gender until 23 minutes into the speech. And just for point of comparison, I looked at Elizabeth Warren’s opening speech for example, she mentioned race and discrimination in the first paragraph. So that’s a big difference and as somebody who is a back woman, knowing that black women are going to be a core constituency for any Democrat who hopes to win the nomination, I was looking to hear messaging specifically for my community, and I did not, at least until 23 minutes into the speech.” Maxwell went on to accuse Sanders of failing the test of intersectionality.

But Sanders did not wait until minute 23 of his speech to address race and gender. He brought them up at the 5-minute mark: “The underlying principles of our government will not be greed, hatred, and lies. It will not be racism, sexism, xenophobia, homophobia, and religious bigotry.”

This was one of his very first substantive remarks: The only reason it did not occur sooner is because the crowd kept interrupting him with applause, and Sanders took several minutes to thank the various speakers who introduced him—three of whom were black. (One was the Black Lives Matter activist Shaun King.)

In case there were any confusion, Sanders also declared that his vision for the country was based on economic, social, racial, and environmental justice. As The Intercept‘s Glenn Greenwald points out, “Sanders did not just mention race and gender once in his speech before the 23-minute mark Maxwell claimed, but did so repeatedly. It was not only the major theme of the speakers who introduced him but a primary theme of his own speech from the start.

Maxwell eventually conceded some ground, tweeting: “I’ve rewatched since yesterday and while I can acknowledge that I missed the passing line at 6 minutes I stand by my point since talking about criminal justice is not the same thing as talking about race and gender and if you don’t get why Bernie won’t win….again.”

For the record, Sanders clearly talked about race and gender outside the context of criminal justice as well.

This incident highlights the disconnect between intersectionality in theory and intersectionality as practiced by the most hysterically identity-obsessed activists. If intersectionality merely means that progressives must consider how all sorts of injustices overlap, then Sanders is clearly an intersectional progressive. But if it requires its adherents to themselves be the victims of overlapping identity-based oppressions—to not just support the right causes but also possess a number of immutable characteristics—then a white male like Sanders will never be good enough.

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The Prohibition President: New at Reason

In a January 8 prime-time border security speech so unpersuasive that only 2 percent of Quinnipiac poll respondents said it changed their minds, President Donald Trump did the country a rare rhetorical favor. By thoroughly blurring the lines between immigration and drug policy—at one point he claimed that “the border wall would very quickly pay for itself” because “the cost of illegal drugs exceeds $500 billion a year”—the president offered an unintentional lesson that the country has needed to learn for far too long: Prohibition kills.

Ask most reasonable adults why the 18th Amendment, which banned the manufacture and distribution of alcoholic beverages, was a resounding policy failure, and they won’t hesitate: You cannot arrest out of existence a good or behavior enjoyed by millions of people. Black markets produce dangerous products peddled for high profit margins by violent criminals. Since there can’t possibly be enough cops, selective enforcement will undermine respect for the rule of law and incentivize corruption, writes Matt Welch.

View this article.

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Brickbat: Bad Cop

Philip NordoA grand jury has indicted former Philadelphia Police Officer Philip Nordo on multiple counts of rape, involuntary deviate sexual intercourse, and sexual assault, as well as well as stalking and sexual oppression. Nordo is accused of sexually assaulting male witnesses in criminal cases and then threatening them to keep them quiet. The abuse took place in police interrogation rooms as well as during prison visits.

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Liberty Links 3/3/19

Liberty Links will only remain publicly available for two more weeks. If you’ve supported my work over the past year, I’ll continue to provide links via email blast.

If you want to continue to receive the links post each week, simply become a Patron or support the site in other ways.

Top Links

Modern Monetary Theory Isn’t Helping (Really worth your time if you’ve been wondering about MMT, Jacobin)

Trump Says Dollar Too Strong in Renewed Criticism of Powell (Bloomberg)

The Right May Finally Get Its War on Iran (Very disturbing, TruthDig)

Netanyahu to Stand Trial for Bribery, Fraud and Breach of Trust, Pending Hearing (The Times of Israel)

Powell Delivers a Subtle Message to Markets (Utterly pathetic, Bloomberg)

If Central Banks Are the Only Game in Town, We’ve Lost (Bloomberg)

Boeing Nominates Former Trump UN Ambassador Nikki Haley to Board (CNBC)

Toll Brothers Orders Plunge as California Buyers Vanish (National Mortgage News)

Fintechs Help Boost U.S. Personal Loan Surge to a Record $138 Billion (CNBC)

Greener Childhood Associated With Happier Adulthood (NPR)

The Monster Pell Has Been Caged At Last (Sickening personal story about Catholic Church pedophilia by Caitlin Johnstone, Medium)

U.S. News/Politics

See More Links »

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