By Pat Garofalo
The guest host today is Pat Garofalo. He’s the author of the brilliant book The Billionaire Boondoggle, the director of state and local policy at the American Economic Liberties Project, and the writer of Boondoggle, a newsletter about the ways that governments get fleeced by companies.
Sympathy for the Tax Man
The Inflation Reduction Act passed by Senate Democrats over the weekend includes $80 billion for the Internal Revenue Service, a desperately needed influx of funds that will help the IRS actually do its job. For years, the agency has been starved of money, leading it to spend more time on relatively inexpensive audits of lower-income individuals — more than half its audits last year were of taxpayers who made less than $75,000 — rather than more expensive efforts to rein in wealthier tax scofflaws. Bonus: Maybe now the IRS can finally upgrade some of its computers that are still running on a programming language from the 1960s. The bill is expected to quickly pass the Democratic-controlled House of Representatives.
More Like Niagara Fails
Another day, another massive tax break package for Amazon. The city of Niagara, New York, which is near the famous falls, could seal a deal this week to give the e-commerce behemoth about $123 million in tax incentives over 15 years in return for Amazon building a new warehouse there. Some local residents are, let’s just say, not very psyched. “It has no benefit economically to the Town of Niagara. It’s a bad idea,” said one. Indeed, Amazon will be receiving that largesse while paying substandard wages for the area and refusing to sign an agreement guaranteeing the use of local labor. Residents claim they didn’t know the project was coming to their town until it was too late to do anything about it — which is pretty much right out of the Amazon warehouse playbook at this point.
The very, very blue blood of horseshoe crabs is used in a host of medical products, including COVID-19 vaccines, which could be putting increased pressure on their population size. In 2020, almost 700,000 horseshoe crabs were captured along the Atlantic coast and bled for the biomedical industry, with more than 100,000 dying in the process and untold others left in a state where they are technically alive, but likely struggling. It’s hard to get an accurate picture of the effect this is having, though, because the number of horseshoe crabs caught by industry players is not public; everyone is left to rely on broad self-reporting by the corporations themselves, the sort of self-regulation that has definitely never gone wrong before, no, never. “There’s no one verifying any of the data,” one expert said. “We don’t know how many crabs the blood industry is killing.” Synthetic alternatives to horseshoe crab blood do exist, but have not been widely adopted.
Cryptocurrency corporations think they know their audience, and that audience is sports fans: Crypto firms have committed more than $2.4 billion to sports marketing in the past 18 months, advertising with leagues such as the National Basketball Association, Major League Baseball and the Drone Racing League (which is apparently a thing), as well as franchises such as the Dallas Cowboys, New York Yankees and Manchester United, all this despite the so-called “crypto winter” during which crypto firms have fallen on very hard times. Even FIFA, global soccer’s governing body, is in on the crypto ad action – and if crypto firms going belly up also managed to take FIFA down a notch, that’d honestly be a win all around.
The Union-Friendly Skies?
The Association of Flight Attendants-CWA has its eye on a big prize: Delta, the only major U.S. airline where flight attendants are not unionized. The union hopes to fare better with Delta’s 23,000 flight attendants than it did in 2010, when a unionization drive was narrowly defeated after the airline spent $38 million opposing it. Union advocates feel that the experience flight attendants had working during the pandemic will lead to a different result this time. Only about a fifth of the overall Delta workforce is unionized, compared to more than 80 percent at American, United and Southwest, and in the time it took me to write this, airlines probably just canceled another 600 flights for today.
RIP, World’s Largest Soccer Stadium
So much for that! China’s Evergrande group had planned to build a 100,000-seat soccer stadium for the Guangzhou Football Club, which the giant real estate firm has an ownership stake in. However, Evergrande is in some financial trouble, as a result of investing in things like soccer teams and giant sports stadiums, and is now backing out of the deal, even though construction is already underway. In return for giving up its rights to the land on which the stadium sits, Evergrande will receive an $818 million refund from the government, which will go toward debt payments, and the government will receive a boondoggle that it hopes someone else will be able to finish someday.
Money In, I Mean, For the Bank
The Irving, Texas, city council voted to give Wells Fargo $30 million in tax incentives to support a new regional campus for the California-based bank. This occurred despite the bank’s leaders having thus far “refused to comment on their plans for Irving or say where the workers for the office will come from.” This follows a similar deal cut between Dallas and Goldman Sachs a few weeks earlier — because as they say, “everything is bigger in Texas, especially handouts for banking behemoths.”
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