"Dishonest scales are an abomination to the Lord,
But a just weight is His delight."
We attended yesterday's council discussion of the Merck 'incentive' package. The discussion was about what you'd expect and it passed on a 7-3-1 vote. The only (modest) surprise was that Greg Casar and Delia Garza joined Ellen Troxclair in voting no.
The supports made all the same claims of "high paying jobs" and "innovation" that supporters of these sorts of projects always make...but, of course, those sorts of claims never pan out.
We said our piece in public testimony:
- "I wish that I could come here cheer-leading this deal the way everyone else who seems to be testifying on it is, but I don't think there's any way to describe this deal as anything short of 'disgraceful.'
- "Let me give you one number that sums up everything you need to know about this deal: $171 BILLION; that is Merck's current market cap."
- "As a point of comparison, I looked it up this morning, that is the equivalent of the GDP of New Zealand...and this is who we're going to give a tax break to [sic]?!?"
- "An innovation zone at the Dell Medical school sounds like a lovely idea, and I think some good things can come of it, but I also think that with a market cap of $171 billion Merck can pay for it themselves."
- "Think about the homeowners, think about the person trying to start a business in their living room, think about the person selling stuff on Etsy...why should that person, barely making ends meet, have to subsidize a development that's gonna happen either way for a company that is currently worth $171 billion?!?"
- The job claims of these sorts of projects never materialize.
- "If we are going to go ahead and pass this deal, I really don't want to hear anyone on this council ever again complain that we may be looking at a budget cut for something in the future."
Like we said, Troxclair was joined by Garza and Casar in voting no. Garza argued that other companies are already doing the things Merck claims it will do. Troxclair eloquently explained the difference between special interest 'incentives' and meaningful relief for taxpayers.
But the most interesting explanation of a no vote, by far, came from Casar. During his vote explanation, Casar publicly let the cat out of the bag that council is only doing this to grease the skids for a much bigger incentive package from the Enterprise fund that the Governor's office is preparing to announce. We'd been hearing that for a week, but couldn't report it without burning sources. Casar spoke accurately about the history of corruption in Enterprise fund activities. Casar said he couldn't "push forward" any deal involving the Enterprise fund. We don't say this often, but we commend council member Casar and thank him for his vote.
[Note: Once Abbott's part of the deal is publicly announced, we're going to have a longer post about what this whole sordid episode teaches about how Texas politics really works.]
But, long story short, the Austin City Council, the Governor's office, and the Governor's U.T. cronies are getting together to give a massive tax incentive to a company whose market cap is the equivalent of the GDP of New Zealand.
Bottom Line: It just is what it is, but what it is is grotesque.