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> Who cares? The people in Iowa who have to subsidize this and don't have the billions sitting in the bank that Apple does? I can't believe anyone really seri

by ebbv 9y ago

> Who cares? The people in Iowa who have to subsidize this and don't have the billions sitting in the bank that Apple does? I can't believe anyone really seriously takes this side of this argument.

deleted 9y ago
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PeterisP 9y ago
It's not really equivalent to subsidizing (which would imply some transfer of value from Iowa to Apple, or selling something below cost) but rather to a discount. Iowa was willing to provide their services at a hefty discount, so Apple chose to "buy" them from Iowa and not another state - but in any case Iowa gets money from Apple (just not the listed rate) and the citizens of Iowa are better off than they would have been if Apple wasn't placing that facility there and thus would pay zero taxes to Iowa.
- ebbv 9y ago
  Any discount given by the government is subsidizing, dude. That lost tax revenue that Apple gets to keep has to be made up for elsewhere. It's not like when they give Apple this "discount" it goes along with a reduction in spending elsewhere. They're effectively reducing their tax revenue without any offset in costs and the tax payers have to make up that difference.
  - PeterisP 9y ago
    The point is that without the discount there is no lost tax revenue that needs to be made up by a reduction in spending, because without the discount the facility gets built in another state and Iowa gets no taxes from it. Offering the discount gets an increase in total tax revenue for Iowa and its residents, since it allows it to get something instead of nothing. However, your argument certainly applies in a wider context - from the perspective of all states together it would make sense to not offer the discount and avoid the race to the bottom, but as they're not coordinated and each care about their own interests, then it makes sense for them to "defect" and offer such discounts to ensure that the facility gets built at their site.

by ebbv 9y ago

> Who cares? The people in Iowa who have to subsidize this and don't have the billions sitting in the bank that Apple does? I can't believe anyone really seriously takes this side of this argument.

deleted 9y ago

[deleted]

PeterisP 9y ago

It's not really equivalent to subsidizing (which would imply some transfer of value from Iowa to Apple, or selling something below cost) but rather to a discount. Iowa was willing to provide their services at a hefty discount, so Apple chose to "buy" them from Iowa and not another state - but in any case Iowa gets money from Apple (just not the listed rate) and the citizens of Iowa are better off than they would have been if Apple wasn't placing that facility there and thus would pay zero taxes to Iowa.

ebbv 9y ago
Any discount given by the government is subsidizing, dude. That lost tax revenue that Apple gets to keep has to be made up for elsewhere. It's not like when they give Apple this "discount" it goes along with a reduction in spending elsewhere. They're effectively reducing their tax revenue without any offset in costs and the tax payers have to make up that difference.
- PeterisP 9y ago
  The point is that without the discount there is no lost tax revenue that needs to be made up by a reduction in spending, because without the discount the facility gets built in another state and Iowa gets no taxes from it. Offering the discount gets an increase in total tax revenue for Iowa and its residents, since it allows it to get something instead of nothing. However, your argument certainly applies in a wider context - from the perspective of all states together it would make sense to not offer the discount and avoid the race to the bottom, but as they're not coordinated and each care about their own interests, then it makes sense for them to "defect" and offer such discounts to ensure that the facility gets built at their site.