MICHELIN PLANT MOTHBALLED …
|| By FITSNEWS || S.C. governor Nikki Haley has bet big on the tire business. In fact her administration has doled out millions of dollars in taxpayer-funded incentives to lure major tire manufacturers to the Palmetto State.
Was that a good bet?
Umm …
Earlier this week, tire manufacturer Michelin announced its intention to mothball a facility in Starr, S.C. According to The (Anderson, S.C.) Independent Mail, operations at the facility are being suspended due to what one local economic developer referred to as “a downturn in mining and related industries.”
The company got $7.8 million worth of taxpayer incentives to build the facility – which was first announced in April 2012.
Not surprisingly, the crony capitalists are sounding the most optimistic tone possible. One told the paper “hopefully, this will get turned around real soon.”
Will it, though? That’s a good question …
With the economy on the ropes again (especially the market for automobiles and heavy industrial vehicles), is this the best industry upon which to place a major taxpayer bet?
We think not …
62 comments
Trivia question:
Which came first:
the Stay Puft Marshmallow man
or
the Michelin Man?
Bibendum was first: 1894.
I knew it before checking, but had to make sure I wasn’t getting senile.
Interestingly, Ghost Busters premiered in 1984, the same exact numbers as the premier of the Michelin man.
Both were inspired by my mother’s figure.
“Now it is time to drink”
https://upload.wikimedia.org/wikipedia/commons/8/88/Michelin_Poster_1898.jpg
Is that you, Rena?
I about shit my pants when I saw that photo. For a second there, I thought someone at Fits jad snapped a pic of me as I was getting out of the shower.
what about ,brawny man?!
https://www.youtube.com/watch?v=p8mGh4EYtfo
Where’s the coverage of the half empty Trump appearance in Charleston yesterday?
His African-American outreach failed to draw any African-Americans.
It didn’t even draw flip/Nick Chuncker/GrandTango.
What a loser.
Lol! Sorry, LMAO!
I guess Will is having trouble spinning this one. Just ignore it, huh?
http://www.washingtonpost.com/news/the-fix/wp/2015/09/24/donald-trump-says-he-didnt-speak-to-a-half-empty-room-but-he-did/
GrandTango and I were on a fabulous date so we couldn’t attend. LMAO!!!!!!!!!!!!!!!!!!!!!!!!
“…a downturn in mining and related industries…”
I wonder if we can guess what President’s energy and natural resource policy led to that downturn…
Large tire go on large vehicles. And that’s down, too.
CATERPILLAR WARNS: Bad news is ‘converging’ and now we have to make some major changes
http://www.businessinsider.com/caterpillar-restructuring-and-job-cuts-2015-9
“Caterpillar has some bad news.
On Thursday, the industrial giant announced plans for it to cut as many as 10,000 jobs as part of a restructuring plan in the face of what it called “a convergence of challenging marketplace conditions in key regions and industry sectors — namely in mining and energy.”
In early trading on Thursday, shares of the company were down over 7%.
Year-to-date, the stock is down about 25%.
Caterpillar is seen as a bellwether for the global economy because its equipment is big, expensive, and often the kind of investment a company makes only when it feels confident about its prospects and the global economy.
The Michelin plant made 13 foot earthmover tires. Many would go on new Caterpillar equipment.
Lower oil prices nail coal and shale oil. And so it goes.
As a coal miner’s son I can say this with a great deal of authority:
Coal mining has always been boom or bust.
They closed down the big assed coal mine near my old home (the one my dad worked for) back in 1965 WAY before there was an EPA and an “Obammer” as prez.
Started going downhill when the automakers didn’t need as much steel plus that is near the time that steel started being sent from overseas. Production and coal mining jobs peaked in the late 50’s – mid 60’s. It did pick up some in the early 70’s (guess when???)
That’s right… during/right after the first ‘energy crunch” due to guess what??? The Yom Kippur War. I had friends from “back home in West by God Virginia’ quit college back then because they could make more money mining than staying in college…Went along pretty good then semi-bust in ’78-’79 then kinda recovered some in the 80’s (if you wanted to help rape the land by strip mining) dipped some and ain’t been too good since.
There’s not a single union mine in Kentucky anymore (pretty much the same all over Appalachia) so you can’t blame the unions for that.
It’s so bad that in my old community there is not a single child in the whole community. The migration of young people who had a chance to get out of Appalachia started years ago – way before “Obammer” was prez……
I’d appreciate it if you’d quit spouting off political shit about “Obammer’s policies (again whom I did NOT vote for) when this shit has been evolving over a long period of time – way before “Obammer” became prez.
I can remember going to college (undergrad) in SW Virginia in the early to mid-80s. ’83 and ’84 – when wer were exporting a lot of coal to Poland and East Bloc – the ships would line up at Hampton Roads bridge tunnel, and the long NS trains coming out of WV and KY. By late 80s, gone. It wasn’t Reagan’s fault, simply OPEC got the price of oil down to where people just switched to burning oil over coal.
There you go….Like I said, boom or bust (and that goes for just every type of mining – even the “oil” industry) probably not diamonds because it’s EXTREMELY controlled and gold to a lesser degree. From what I understand, Australia is now (or maybe WAS) one of the biggest exporters of coal.
I vividly remember the coal trains full of coal leaving my old home area. The one thing that has stuck in my mind was remembering the grown-ups saying “they leave full, come back empty and hardly a boxcar, fuel tanker or anything else of commerce in the whole damn train” (in other words they’re taking everything out and ain’t bringing nothing in). And that was back in the “good times” of the ’60’s……….. I’ve thought of that many times. ……..
It’s the same all over the Appalachia region (southern WV, southwest Virginia, and eastern Kentucky) as far as the economy goes and has been that way for quite some time (NOT just in the past few years either)
The recent book “Grey Mountain” (a best seller by John Grisham) comes to mind. I read it and it is an accurate representation of life “back home” for so many people since the last 15 years or so. The Appalachian coal region is fast becoming an area of abject poverty and nobody in the rest of the country really gives a shit.
if you haven’t read it it’s a damn good read.
Thanks for confirming what I was posting…the situation where my friends quit college to go into mining shortly after the first “energy crunch” of ’73-’74 is gospel truth.
I’m just getting a little tired of some people injecting politics (especially “it’s all Obammer’s fault”) into every little damn thing.
That’s such a cop-out and played as hell.
“I’d appreciate it if you’d quit spouting off political shit about “Obammer’s policies (again whom I did NOT vote for) when this shit has been evolving over a long period of time – way before “Obammer” became prez.”
LMAO!!!! Rocky didn’t vote for him either.Stop lying about who you are,what you were and tell the truth about who you will never be!
Morning Flip!
Facts don’t matter to right wing nut jobs.
I’m guessing…Herbert Hoover.
Mining has reached the bottom of the downturn and has begun its recovery, according to a new IBISWorld report.
The major commodities, across the board, have seen a revival in fortunes after shedding prices continually for the last few months, creating a horror year, causing revenue in the mining division to decline by 10.0% in 2014-15, to reach $211.8 billion.
Iron ore hit a four month high last week after dropping to all-time lows in in April, having now risen to more than 40 per cent of the trough since then.
Gold has also seen a slight rally over the last month, following weaker trading in Europe on the back of poor economic data from China, coupled with a slightly weaker US dollar.
“With the dollar now slipping again and with some of the other markets looking a bit [like they have reached unstable highs and are likely to decline], it may be that the precious metals look relatively cheap as a safe-haven asset class should investors feel the need for a haven,” William Adams, head of research at Fastmarkets, explained.
Coal, while not seeing dramatic price rises, is again seeing some positive turns from emerging markets.
http://www.mineweb.com/news/sustainable-mining/mining-rising-out-of-the-downturn/
About 100 more workers have been offered jobs at other Michelin operations until the plant is returned to full operation.
Michelin was granted more than $7.8 million in state and local incentives to build the newest Starr plant.
According to an agreement approved by the Anderson County Council, Michelin qualified for larger incentives if the company created a minimum of 125 jobs and made a minimum investment of $150 million. Those incentives requirements have been met, county officials said Wednesday.
——- Anderson Independent
Seems like a bargain for a $150 million investment.
Don’t count on the investment targets being met. I used to be in that development business and I can tell you the accounting is non-standard to say the least.
It is all confidential and all language is cloaked in ambiguity. It is an easy scam.
” It is an easy scam.”
Hell, the Commerce Department handing out all this taxpayer money(and I’m fine with tax breaks, but dipping into taxpayer pockets to fund corporations is fascist bullshit) doesn’t even have an auditing staff.
No one follows up on shit. They hand over the money, get a few promises, & it ends there.
Absolutely.
In the Spartanburg area there are shitloads of empty “distribution centers”/warehouses/light manufacturing, etc. built with BIG fanfare over the last 10 years. They’re occupied for a few years and then shut down (New Cut Road area off I-26 comes to mind) they sit vacant and then the same type of shit gets built on SC 290 near I-85 and guess what??? Some of them went out of business right beside another one being constructed and that’s right fucking now!!!!!
Come to think of it……….maybe those vacant buildings are the FEMA camps the tin-foil hat Tea Party types were in a lather about a year or two ago……………………
To the tune of “investing” 1.5 million for each individual to have a job??????
2012 Data
The average capital investment per announced job in 2012 was $480,000, a 19% increase over $403,000 in 2011. Chemical and petrochemical manufacturing projects are again the most capital intensive, largely due to the announcement of several fertilizer and ethylene facilities that require large capital investments and few employees.
http://www.ey.com/US/en/Services/Tax/State-and-Local-Tax/2013-US-investment-monitor
Volvo’s investment of $600,000,000 to create 2500 jobs sounds suspicious to me that is only $240,000 per job. I toured the BMW plant and saw lots of machinery, conveyors and robotic vehicles following metalic tape paths on the floor. Didn’t see a lot of workers.
Sparklecity, you do realize they invest that money in order to make profit by creating products, not to create jobs.
Next you’ll be telling me that the purpose of war is to create jobs.
Nikki’s corporate welfare team of Bobby Hitt at Commerce, Rick Reames at DOR and other sycophants hand the money out like it grows on trees. Must be nice to be a big corporation with connections. Check out the Coordinating Council for Business Development. All big businesses drinking from the free pool of tax dollars.
I am with Bible Thumper on this one, $7.8 million in tax incentives to get an investment of $150 million, you do what it takes to get the business in your state. If this is a true tax incentive, no money was handed out from the state treasury to this corporation to locate in SC.
A tax incentive is a deduction, exclusion, or exemption from a tax liability offered as an enticement to engage in a specified activity, such as investment in capital goods for a certain period. No money is actually taken out of the treasury and given to them, they received a credit for $7.8 million against future taxes.
Given that this was probably a very competitive process with other states to locate this plant, the tax incentive may be perfectly appropriate.
Hope business picks up so they can resume manufacturing soon.
A subsidy is an indirect handout. If a company requires public services — which all do in major industrial operations — but receives deductions, exclusions or exemptions from taxation, then they’ve just received a handout from the taxpayers. The Tax Foundation is a pseudo-think tank run by fat cats with vested interests in the perpetuation of the crony capitalist status quo. Take a look at its Board of Directors and staff. They’re all hip deep in with Heritage, the Murdoch Media, and the Kochs.
An “exemption from taxation” is not a handout. It’s simply allowing a company to keep more of its money.
If you don’t pay the taxes that fund the public services, then who pays for those services?
“If you don’t pay the taxes that fund the public services, then who pays for those services?”
You’re getting too complicated, start with the principle that not taking someone’s money isn’t a handout(because it’s true and undeniable) and work backwards- it will help you.
So for example, if a company uses government water systems they pay for that separately. A tax exemption is separate and unrelated.. The same can go for all such “services”, which in essence become “user fees”- which at least is voluntary.
This is also the same as state and federal government give deductions and tax breaks to individuals. Manray9 has determined that the state allowing you to keep your own money is a gift from the state. The governing body always has first dibs to your wealth.
A skewed evaluation. If you owe the money in taxes, based on the legal or legislated standards of assessment, and you’re allowed to escape payment, that’s a handout from the government. Somebody makes up the difference. Being permitted to avoid payment, rightfully owed, is a subsidy.
Does the same reasoning apply to a young family getting a children deduction for a child. Is that a handout, try to be philosophically consistent. How about writing off interest payments on the family home?
I just don’t see the problem with tax incentives, it spurs entrepreneurship and the creation of wealth.
We just disagree, and the law is on my side.
And just about every state offers business tax incentives.
Apples and oranges. Child deductions benefit all parents regardless or wealth and class. They contribute to a social good across the board. Tax incentives for corporate fat acts are intended to maximize profits for a special group. They put the “crony” in crony capitalism. If states such as South Carolina, having been under the rule of “free market” Republicans for many years, are such a nirvana for businesses, why do they require bribes to locate here?
Forty-eight of the the Fifty states offer tax incentives to business’. If South Carolina wants to remain competitive in attracting business’ to the State, they must offered the same as the other states.
Corporations, like individuals are taxable entities, and both are taxed with both receiving incentives to do certain things.
It is written into the tax laws, if you want to change it, contact your representatives, see if they want to repeal them.
These incentives are offered so SC will remain competitive with other states.
This is not “crony capitalism,” as Fitts defines it, it is all legal, above board, and perfectly legal.
You’re getting too complicated,
That’s the problem, you cant think it through far enough to realize that YOU and everyone else is paying the difference.
Incentives are bullshit, but until all governments abandon them, we are stuck with a broke system. These incentives are based on campaign contributions and lobbyists and are patently unfair.
You really need to re-read what I wrote.
OMG…talk about drinking the Kool-Aid.
Good argument.
Seems like every time there’s some “tax incentive” for a start-up business in the Great State of South Carolina, I pay more personal tax to the Great state of South Carolina……………
My personal SC tax returns bare that out…………
They’re moving to China and Mexico, just like Boeing is gearing up to do.
Cheaper than SC?
That’s some slave wages.
The crony capitalism of the South’s Republicans may come back to bite Tennessee’s ass with the VW deal. Now if VW sales decline after the revelations about the crooked software in their diesel vehicles, who’ll be stuck holding the bag? Earlier this year Governor Haslam submitted a budget with $200 million in spending cuts, but including $166 million for the VW plant in Chattanooga. What is crony capitalism? Socialization of risk, privatization of the profits.
Exactly. It’s a horrible abuse of government power that tries to centrally plan economics(the mark of socialism) and encourages corruption.(pol payoffs for taxpayer funded incentives)
It is what Republicans are truly about — the unsavory alliance between government officials and big money. All the other issues — guns, abortion, the imaginary threat of Sharia law, the myth of religion being under attack, gay marriage, immigration, etc. are just tools to dupe the rubes into electing Republicans so they may protect moneyed interests. You see it in Columbia almost every day. And in Nashville, and Montgomery, and Raleigh…
I agree, but don’t forget the Democrats too, they have the same issues simply with different patrons.
Agreed. But they have zero power in the south.
Rubes like me, LMAO!!!!!!
You just contradicted your earlier posts. Do you support incentives or not?
No, go back and re-read.
No story on the Bloomberg Consumer Confidence Index out today… Can you guess why?
” With the economy on the ropes again (especially the market for automobiles and heavy industrial vehicles), is this the best industry upon which to place a major taxpayer bet? ”
Why does FITSNEWS tell such lies?
August was a great month for car sales.
Now, Caterpillar in on the ropes due to the Republicans in Congress failing to pass an infrastructure bill since September 2011 when Obama went to a joint session of Congress to request it.
But, Republicans were terrified that infrastructure construction would improve the economy so fast that it would hurt them at the 2012 presidential election.
Think about that construction workers next time you think about voting Republican.
John Boehner decided not to take his minority of TEA Party freaks by the balls and show them what majority rule is all about and has done nothing about passing an infrastructure bill…since 2011. He has also been the biggest failure that the office of Speaker of the US House has ever seen.
And, guess what? It’s the year before yet another presidential election.
Will the Republicans FINALLY put country and citizens before party…or, continue to so what ALEC and the Kochs tell the to do?
Wonder how much kickback dough she got?
She was broke as a convict and had bad credit when she took office. I wonder what that
looks like now.
All joking aside, I thought that was Michael Haley.