Saturday, September 04, 2010

Energetx Composites, and Fighting the Republicans to Create Jobs in Michigan

Creating jobs in the expanding field of renewable energy or any other sector has become quite the arduous and confusing task when you have right-wing operatives nipping at your ankles at every turn - just ask one Holland area company that keeps finding itself whipsawed between praise and condemnation for taking the plunge and using the available tools at its disposal to get new manufacturing established in this state. Its only consolation may be that it's not alone in its struggle, for many businesses are probably under the same gun - you just don't hear about them in the media, and for that they should be grateful. The story of Energetx is now reaching to the depths of right-wing absurdity after having to jump through all kinds of media and political hoopla in the past few years, and when you add it all up, sometimes its a wonder we have created any jobs at all. Certain people keep insisting on throwing up the roadblocks, as you will see.

Energetx Composites first appeared on the radar in the summer of 2009, the Holland area spin-off of S2/Tiara Yachts receiving attention as one of the leaders in expanding its existing product line into making parts for our new green energy economy. With plans to produce hubs and blades for wind turbines, as well as other composites for the transportation sector, the company announced they would be investing $37 million in new buildings and equipment, and had received MEGA credits up to $27 million redeemable after (very important designation there, one that is often left out of these stories) they had created an estimated 1068 jobs over the next five years. Energext also received a $3.5 million clean-energy grant from the Recovery Act, a figure that is pretty small on the scale of the size of the production being discussed, and in comparison to other grants awarded across the nation. Keep that in mind, for "stimulus" will come up later in the story.

All in all, pretty standard fare for a small to medium-sized business looking to launch a new job-creating endeavor. 46 other states that offer such incentives would be happy to take the business from us if they could - and if the Republicans, with the help of the media, continue with the rhetoric about removing the incentives, insist on creating new layers of bureaucracy, and keep trotting out the right-wing economists to put their negative spin on the issue, it gets to the point where you couldn't blame these companies if they did look for a state that wasn't ruled by the uncertainty of politicians who want to use economic development as a political football.

In February, Pete Hoekstra used Energetx as a backdrop to attack the incentives, rudely attaching a gubernatorial campaign stop to a planned celebration of these new jobs, a move that forced company CEO David Slikkers into having to defend the credits to the press. As bad as that was, they should be grateful that they didn't have to produce the paperwork for the cameras - because that just might be coming next.

Nancy Cassis has decided to finish her political career by introducing endless legislation that will burden companies and MEDC with new layers of government "transparency", the latest being accuracy in "press releases" of job predictions - a figure that comes from the businesses themselves, based on their estimates of future demand. Will companies want to downplay projections based on rigid expectations from the state, a move that could potentially drive away their investors? Probably not. It would be a definite negative in Michigan's column as far as locating here goes.

And speaking of that future location, let's not forget Republican candidate Rick Snyder, and his repeated attacks on MEDC and his call to limit the use of credits, a campaign tactic that has alarmed economic development officials across the state as they publicly warn that such talk could drive business to other states that aren't endlessly debating the value of incentives. "It's dangerous when we talk about replacing incentives. People read this stuff." said Grand rapids economic development official Birgit Klohs. Proof positive of this phenomena came from the Free Press concerning movie industry credits, where industry officials have said that Michigan has already lost productions, and studios are wary of investing here due to talk of elimination.

Maybe Cassis can introduce legislation that will force Republicans to declare just how many jobs we have lost due to their incessant negative chatter and repeated political stunts of the past few years. If she wants to talk about "eroding the public's trust" and risking "millions in taxpayer dollars", well, all of the above could certainly fall in that category. And, when you add the fact that the Republicans removed the SBT without a replacement and then complained about "uncertainty" in business taxes, a move that cost Michigan jobs and investment as it took a year to settle the issue, and on the heels of that came the Republican creation of the (supposedly) "job killing" MBT, complete with its dreaded surcharge that was tacked on because of Republican political grandstanding over taxes, you really have to question whether or not these people have any desire to create jobs in the first place.

Whew. Add it up. It's been a nightmare - and the nightmare seems to just keep growing. Which leads us back to Energetx, who found themselves under the media glare once again this week. They have optioned 26 acres to build a $6.5 million dollar facility that will produce industrial-size wind turbine blades, a project that is expected to create 750 jobs. They also are applying for a Renewable Energy Renaissance Zone property credit that will last for twelve years, and, with contracts in place, they want to break ground next spring so they can get going on production. Once again, local economic development officials are praising the move as an example of how we can diversify our economy. So, what's the problem this time?

Cue the newest right-wing created controversy: Creating demand for workers drives up wages. You see, the recession has been great for suppressing wages due to high unemployment, and if we go and create these new jobs, we darn sure better get those employees on the cheap. Or so claims one economist, whose ties run to the deepest of the darkest hearts in America...

At least 750 jobs will come to the area, the company claims, but whether those jobs will alleviate the area's more than 10% unemployment rate is the subject of debate.

"You have to ask the people who are going to take those jobs, are they people who already have work, or are they people currently unemployed and are now going to be able to work," said economist Russ Roberts from George Mason University in Washington, DC. "If it's the latter, the stimulus is doing what it's suppose to be doing. If it is the former, and the money is used to hire people who already have work, than the money will end up increasing the demand for those workers, forcing their wages to go up. Which is great for those people, but why do I as a taxpayer have to pay for that?"

Wow. What a mind job. It's the closest you will come to an argument that wants to profess that high unemployment is basically a good thing. So, who is Russ Roberts? Besides being a professor at George Mason, a public university mind you, he is a J. Fish and Lillian F. Smith Distinguished Scholar at the Mercatus Center that is located there. What is the Mercatus Center? None other than a creation of the Koch brothers, the same folks who brought you the Right Wing &trade as it stands today. Described as the "primary underwriters of hard-line libertarian politics in America", the brothers are funding the "War Against Obama"; the money behind the "Americans for Prosperity" and other astroturf Tea Party efforts, the creation and funding of the Cato Institute as well as numerous extreme right foundations, you name it, they are in it, their billions of dollars are pushing their family's long held beliefs "in drastically lower personal and corporate taxes, minimal social services for the needy, and much less oversight of industry—especially environmental regulation" as the driving force behind Republican policy today - and WOOD TV just calls this guy an "economist", never bothering to explain where this is coming from.

In the mid-eighties, the Kochs provided millions of dollars to George Mason University, in Arlington, Virginia, to set up another think tank. Now known as the Mercatus Center, it promotes itself as “the world’s premier university source for market-oriented ideas—bridging the gap between academic ideas and real-world problems.” Financial records show that the Koch family foundations have contributed more than thirty million dollars to George Mason, much of which has gone to the Mercatus Center, a nonprofit organization. “It’s ground zero for deregulation policy in Washington,” Rob Stein, the Democratic strategist, said. It is an unusual arrangement. “George Mason is a public university, and receives public funds,” Stein noted. “Virginia is hosting an institution that the Kochs practically control.”

That is how deep the rabbit-hole goes, kids. Not only are we fighting the inept Michigan Republicans and their endless arguing and obstruction about taxes and incentives, we are facing the long arm of the (sometimes) publicly-funded Koch brothers, who turn up in simple local media stories to "debate" new development that is going on at innocent companies such as Energetx.

Of course, if the Republicans take back power, all bets are off and all this probably becomes "OK" - just as long as they can get a press release out of the deal. Or, given all that has come before, they completely botch the whole thing, and we have to sell the state for parts.

Think about it, and vote accordingly. How can you trust these people with your money?