No easy answer on incentives
ADM, the Decatur-based agricultural conglomerate, asked for a tax break in connection with its move to Chicago. House Speaker Michael Madigan said no. ADM then announced it would move its corporate headquarters to Chicago, regardless.
Did ADM's craven executives cave after a morally outraged elected official said, "My way or the highway." Or did ADM, which preferred Chicago as the location for its new headquarters all along, abandon its quest for tax credits while also abandoning its pledge to bring new jobs to Chicago and Decatur in exchange?
Readers can judge in the fullness of time because all the ramifications of ADM's decision won't be known for months, maybe even years.
But one thing is clear — Madigan said no to tax credits while ADM said yes to Chicago. Madigan also urged a thorough review of "how we currently provide incentives to big corporations."
But what does this mean and, more important, what good will it do?
If our elected officials were serious, they would work to reverse Illinois' reputation as a lousy place to do business by enacting structural reforms in such areas as litigation, workers' compensation and business regulation.
The goal ought to be to create an atmosphere that enhances Illinois' Midwestern location, strong transportation network and impressive workforce.
Then Illinois wouldn't perpetually face a decision about providing tax incentives to keep some business and attract others. Madigan referenced that idea when he suggested "helping all job-creating businesses ... thrive and succeed."
Unfortunately, it's hard to give credence to his words.
Speaker Madigan has had ample opportunity to do what he now suggests and has done little. That's because he knows substantive change would anger the Democratic Party constituencies — including trial lawyers and unions — who lavishly fund his campaign organization.
As a result, Illinois' business picture is dark and cloudy.
While Illinois has provided tax breaks to major companies such as Sears and CME Group, Madigan recently blocked tax incentives for Office Depot and ADM.
In response, OfficeMax, Office Depot's merger partner, announced it will be moving 1,600 jobs in Naperville to Boca Raton, Fla. That's a lot of jobs and a lot of productive, tax-paying citizens Illinois can't afford to lose.
ADM, however, opted to move about 60 to 70 corporate executive to Chicago without incentives.
But plans for a high-tech center with roughly 100 more employees won't be going to the Windy City, and neither will as many as 500 new jobs be added to ADM's Decatur workforce of 4,400.
Chicago Mayor Rahm Emanuel and Gov. Pat Quinn already are pushing for a change of heart by ADM. Does anyone doubt the issue of tax incentives will come up again?
No one, of course, wants to engage in a bidding war for jobs. But states that foul their own economic nests find themselves pushed into unpalatable choices.
If Illinois cannot summon the political will to make this state a place where job-creators want to be, it will find itself forced into negotiating side deals with clout-heavy corporations. There's no third way.