While President Donald Trump was revving up his Republican base on Saturday in Green Bay, his administration extended an olive branch to the state’s most powerful Democrat.
Gov. Tony Evers said on April 17 that he thinks it’s “unrealistic” for Foxconn Technology Group to employ 13,000 people in the state and he wants to renegotiate the contract, the Associated Press reported. Evers told reporters that the state was working with Taiwan-based Foxconn to look at revising the original contract for the proposed facility to build liquid crystal display panels because it “deals with a situation that no longer exists.”
We’re not entirely sure what the governor means by “no longer exists,” especially when we drive past all the activity near the intersection of Braun Road and Highway H.
“I don’t know why he isn’t optimistic and hopeful that 13,000 jobs would come to the state of Wisconsin,” Kayleigh McEnany, national press secretary for Trump’s 2020 campaign, said Saturday in an interview with the Milwaukee Journal Sentinel. “We encourage the Democratic governor to work with Republicans, work with the president, work with Foxconn, to make sure those jobs come here because this is a deal that was engineered by President Trump, and we would hope that the Democratic governor would be on board to see that through.”
The original contract has Foxconn building what’s called a Generation 10.5 facility. But Foxconn now plans to build a Generation 6 plant, which will make smaller display screens for cellphones and other devices. Opponents have said that wording referring to a Generation 10.5 plant puts the entire contract in jeopardy if Foxconn builds a different-sized factory. To his credit, Evers discounted that possibility: “I think that we’re past that point and I don’t think anybody would have ever called them out and say we’re going to negate this deal because of that,” he said in an interview.
The tax incentives that are a part of Foxconn’s deal with the State of Wisconsin don’t kick in unless the Taiwanese manufacturing giant reaches certain benchmarks.
In 2018, Foxconn came up well short of its first-year target of 260 jobs, costing it $9.5 million in tax credits, the Associated Press reported. The 2019 jobs goal has doubled to 520, and the 2020 goal — when Foxconn says production will begin — is nearly 2,000 jobs. Starting in 2027, it must have at least 10,400 workers to qualify.
Critics of the deal suggest that the failure to reach the 2018 benchmark means that Wisconsin is being taken for a ride. We believe that it’s evidence of the taxpayer protection in the deal: Because Foxconn didn’t hit the benchmark, it didn’t get the tax break. If Foxconn doesn’t meet the terms of the contract, it doesn’t reap the tax benefits.
Also, fixation on “13,000 jobs” — whether by the governor, or anyone else —is misguided. If Foxconn were, hypothetically, to end up only creating 6,000 jobs in the village, that’s 6,000 more people employed in Wisconsin, in Racine County, in Mount Pleasant than would have been employed — and generating taxable revenue — had Foxconn set up shop someplace else. Not to mention all the housing development deals, taking place on both sides of Interstate 94, that have been cited specifically as tied to Foxconn.
The president made his name as a businessman, a dealmaker. He was instrumental in bringing Foxconn to the United States, and to Mount Pleasant specifically. Foxconn CEO Terry Gou reportedly met with the president at the White House this week; while the reason for the meeting is unclear, at minimum it suggests that Foxconn is willing to work with the White House.
More importantly, this is one of the major deals Trump has had a hand in as president, in a state that figures to be as important to his re-election as it was to his election. It’s in his interest, as much as it is in Evers’ interest, to do whatever can be done to persuade Foxconn to move forward with something big in Mount Pleasant, not something small.
The tone of Gov. Evers’ public statements on Foxconn in recent days don’t strike us as particularly helpful to the people of Wisconsin.
President Trump has offered to help in an area where he has considerable experience.
We suggest the governor take the president up on his offer.