Kowalko Gives Markell The Knockout Punch Over NY Times Op/Ed Piece

Former Delaware Governor Jack Markell wrote an opinion piece for the New York Times this week called “Let’s Stop Government Giveaways To Corporations”.  In it, he urged states not to get sucked into giving away the farm for huge corporations.  Something, even Markell noted, he did himself during his tenure as Delaware Governor from 2009-2017.  I found the irony behind Markell’s piece astounding as I felt he sold Delaware public education students down the river with his insane Race To The Top and Common Core antics.  State Rep. John Kowalko takes it a step further n an open letter to Markell.  Some of Markell’s many corporate giveaways in Delaware still haunt us to this day.

AN OPEN LETTER TO FORMER GOVERNOR MARKELL

Dear Jack,

I’ve just finished reading your N.Y. Times op-ed and I feel it’s my obligation to Delaware’s taxpayers to respond. I’d like to think that your most recent missive has merely added to my disappointment in you but I think I’ve already passed the minimum expectations level in regard to your performance and legacy. I will try to be objective in my analysis and critique.

First, I find it unbecoming for you to use “revisionist history” as a crutch to support your crippling economic decisions. That pejorative explanation has become the trademark of Trumpism and the Republican Conservative ideologues and should be an embarrassing reference for any legitimate public servant who wears a “D” after his title. I’d suggest that you cease evading responsibilities, casting blame and rewriting reality or remove that “D”.

Your statement that “I was as guilty as any elected official at playing this game” fails to adequately express the reality that you were much more “guilty” then other Delaware elected officials. You blithely dismiss the seriousness of this ongoing “economic/corporate welfare” threat by writing “And I don’t blame public officials, either, for their efforts to attract businesses with enticements, since they otherwise would risk losing out on new jobs, the transfer of old ones elsewhere and the bad publicity that could come with abandoning efforts to entice or retain companies”. That attitude and admission would be better relegated to a confessional for your personal “mea culpa” and forgiveness ask.

In your article some of the revisions you make to your economic tenure as Governor are merely omissions, others are misrepresentative of reality and others seem to be deliberate distortions. So I will attempt to briefly summarize what you’ve conveniently forgotten. During your 8 years as Chief Executive your DEDO/Strategic Fund doled out over $250 million (in grants and subsidies) in taxpayer money. Approximately 37% of the recipients were huge fortune 400 companies. This number does not include the more than $80 million in lost corporate revenue from your hastily contrived “Delaware Competes Act” (House Bill 235 quickly ushered through the Delaware General Assembly during the first few weeks of 2016 session) along with the “Commitment to Innovation Act” (SB 200). You mention the failed Fisker debacle but choose to ignore/deny your other expensive yet failed economic enterprise the “Bloom” subsidy. Not only has the cash grant/subsidy failed to produce the promised jobs but you’ve ensured that 300,000 individual and commercial Delmarva ratepayers would be burdened with an additional 20 years of subsidies to a private speculator/entrepreneur at a cost of $12-$15 million per year. Your remarkably optimistic speculation that the two of three Dow/DuPont spinoffs was a victory belies the reality that a preponderance of the research jobs are gone and Delaware is left with a comparative handful of jobs at the two headquarters. This type of Pyrrhic victory should not be heralded as the sign of an economic boon to Delaware. You also failed to mention the layoffs of 1700 (six-figure) DuPont researchers especially in light of your Secretary of Finance Tom Cook’s testimony on the House floor in response to my query that those jobs are gone and not coming back despite the Competes/Innovates corporate tax cuts and the 13 million cash giveaways that Ed Breen publicly said would not affect DuPont’s plans for job cuts. To paraphrase Mr. Breen’s remarks in the News Journal article “that money won’t make a difference in our plans but I’m not going to turn it down”. And lest we forget Jack, $10 million to JP Morgan (declared $24 billion in profit the year before), $2.5 million to Sallie Mae ($71 million profit 2^nd qtr. 2017), $70 million infrastructure improvements to the Astra Zeneca campus (dramatically improving the value of their property now being sold) housing an ever dwindling workforce.

I do agree with your sentiments expressed as such “but it would be better for taxpayers if these kinds of cash incentives could be invested instead in such things as schools and infrastructure”. Maybe that will happen under your successor’s tutelage via the newly minted taxpayer giveaway mechanism named the “Delaware Prosperity Partnership”. Perhaps that corporate dominated cabal will accept applications for funding to restore the $27 million in cuts to education you made in 2009 that have continued to date (under the guise of flexible spending block grants) or the additional $31 million in cuts to public education in this year’s budget or maybe some of those poor and elderly former pharmaceutical assistance recipients could make their anguished cries heard.

Wow! Kowalko nailed it!  Jack Markell, you had your time as leader of Delaware.  I know you like to pontificate over your imagined “success” as Delaware Governor but far too many of us see past your hypocrisy.  And for the most recent news on the Delaware Prosperity Partnership, the following happened this week with that:

WILMINGTON, Del. – Governor John Carney on Friday announced that John Riley, a former state Director of Business Development, will serve as interim CEO of the Delaware Prosperity Partnership – the newly-established public-private partnership that will lead the state’s economic development efforts.

In the position, Riley will help launch operations, develop a strategic plan for the new nonprofit, and conduct a search for a permanent chief executive.

“John is well-known and respected across our state, and has significant experience in economic development,” said Governor Carney, who will serve as co-chair of the Delaware Prosperity Partnership board. “I’m pleased he has agreed to help us launch the partnership. We are committed to changing the way we do business, fostering innovation, and growing our economy. I’m confident John will help position the partnership to succeed.”

“Establishment of this entity was a critical step to enhance the state’s ability to attract, grow and retain companies; to build a stronger entrepreneurial culture and to support private employers in identifying, recruiting and developing talent,” said Rod Ward, President of CSC and co-chair of the Delaware Prosperity Partnership board. “As Interim CEO, John will work with the board on the recruitment of a permanent CEO and development of a strategic plan for Delaware.”

“Thank you to Governor Carney and the entire board of the partnership for this opportunity,” said John Riley. “Delaware has great assets – a talented workforce, a strategic location along I-95, responsive leadership, and great communities up and down our state. I look forward to doing everything I can to attract investment and additional good-paying jobs to our state, and setting up this new partnership to succeed in helping grow our economy.”

Riley served as Director of Business Development under then-Governor Thomas R. Carper. He retired from Ashland where he was Director of Government Relations and previously served as Director of Public Affairs for Hercules Incorporated. Riley has continued to be active in economic development and assisted Governor Jack Markell’s Administration with Delaware’s strategy in responding to the DuPont-Dow merger.

Members of the Delaware Prosperity Partnership board approved the hiring of Riley at an organizational meeting this week.

Governor Carney, who took office in January, has made it a top priority to restructure Delaware’s economic development efforts, and strategically partnering with the private sector on economic growth was a key recommendation of the Governor’s Action Plan for Delaware. Last month, Governor Carney signed House Bill 226, creating the Delaware Prosperity Partnership and a new division within the Department of State to support small business growth.

The Delaware Prosperity Partnership will be run day-to-day by the chief executive officer and a full-time staff. The nonprofit will lead business marketing efforts for the state, with a focus on attracting early-stage and technology-focused businesses, recruitment of large employers, and expansion of international business opportunities for Delaware companies. Its leaders also will work with employers and Delaware educators to fill key talent gaps in the state. The state will jointly fund the partnership’s operations with private business.

 

State Rep. John Kowalko Weighs In On Delaware Taxpayer Money Getting Flushed Down The Toilet

In my article on our Non-Transparent Delaware, State Rep. John Kowalko left a comment that deserved its own post.

As regards the “Commitment (of taxpayer money) To Innovation Act” please read the following:

I certainly have not and will not support any of these corporate tax welfare bills. DuPont/Dow moved the majority of research and other jobs in the agricultural spinoff to Iowa and Delaware taxpayers are left with some extremely costly crumbs (headquarters only) in Wilmington. Let me point out to all that there was and will continue to be opposition to this ravaging of the taxpayers’ wallet and I certainly will do my best to expose my colleagues to the illegitimacy of such policies that offer no return on investment for Delaware taxpayers.

My point is that making a product (Oreos for instance), moving 600 jobs from Chicago to Mexico across the border for dirt cheap wages and rueful working conditions benefits only those multi-billion dollar corporations and their CEOs (see DuPont/Dow $80 million bonuses) while idling thousands of American workers who no longer have spendable income to support the consumer spending that is needed for local businesses to survive. Ross Perot was right about that sucking sound. For example: DuPont $200 million factory built in China (recently opened) employing thousands of Chinese workers manufacturing solar panels for sale back here, or Johnson Controls recently constructed and opened battery manufacturing facility ($150 million) in China for distribution from the Delaware distribution center in Middletown that taxpayers invested millions in infrastructural and road improvements. For example DuPont spinoff headquarters staying in Wilmington while a significant majority of the actual jobs of the agricultural research branch goes to Iowa leaving Delaware with 1700 layoffs of well-paid positions and only a potential for job growth with a price tag of $16 million for Delaware taxpayers. The list goes on and on.

The “Corporate Welfare” policies of this Administration have cost the Delaware taxpayers $250 million during Governor Markell’s term. This irresponsible wasting of the taxpayer dollars has resulted in no discernible return on investment and has stopped absolutely no job losses from these wealthy corporations. Further compounding this administration’s erroneous economic missteps is the recent policy that was passed, despite my and Representative Williams objections, labelled the Delaware Competes Act. This corporate giveaway will cost over $48 million in lost revenue to Delaware with absolutely no appreciable effect to retain or grow jobs. Now the Administration has filed more legislation branded as “The Commitment to Innovation Act” that will further erode necessary revenue that provides basic, necessary services to Delawareans. Neither of these misguided economic policies will reinforce local business growth or stability and will leave a gaping hole in Delaware’s budget that this Administration will attempt to fill on the backs of state employees, seniors and the poorer families in Delaware.

Adding to the insult of these types of corporate giveaways is the actual statistical proof that these types of bribes and irresponsible economic policies have been marked by failure after failure at an unaffordable expense. Read the linked article and please note that $22 million went to JPMorgan which profited to the tune of $24.5 billion last year with “promises” of job growth that would inevitably have occurred without this taxpayer outlay. Note also the proposed $14.16 million to DuPont which totally dismisses the fact that there has been 1700 well-paid jobs recently and irretrievably cut by DuPont in Delaware. And the bulk of its future jobs with the newly created agricultural spinoff (Pioneer) will be lost to Iowa. Consider the $11 million gift to Incyte Corp. with the promise of creating 130 jobs in the future on the heels of the announcement by Incyte that they were laying off 137 Delawareans. The Fisker and Bloom debacles speak for themselves as monuments to irrational and irresponsible wastes of taxpayer dollars. One tenth of that $250 million diverted to supporting locally based businesses for job growth, infrastructural investments and production improvements via tax credits and subsidies would ensure a healthy and robust growth in our local communities and not end up in the pockets of corporate profiteers. Call your legislators and demand that they resist this callous and flawed attempt to redistribute and divert revenues from Delaware families into the coffers of wealthy corporations.