Star-Ledger: Camden group hopes to expose the truth about corporate subsidies | Opinion

July 29, 2022 State and Local Policy

New Jersey has one of the least functional and most corrupt so-called “economic development” systems in the country – and that’s saying a lot, as states and cities across the country spend a collective $95 billion on these corporate subsidy programs, trying to entice individual corporations to do particular things, with the vast bulk of that money wasted.

Last year, it looked like things might improve after Gov. Phil Murphy initiated an investigation into New Jersey’s many economic development failings. The investigators did their jobs, producing several reports chock full of gory details about corrupt insider dealings and disengaged administrators, but state legislators reacted by putting cosmetic reforms and billions more dollars into essentially the same system.

Now, some community members and activists in Camden are taking matters into their own hands. They’re setting an excellent example not just for New Jersey, but for anyone in the country concerned over the negative effect corporations have in their local communities.

First, it’s important to understand that Camden is the prime example for how corporate subsidy programs fail. Many programs meant to give it an economic boost produced no results due to a combination of incompetence and corruption, with notorious South Jersey political boss George Norcross sucking up public dollars for his family and cronies and producing little for Camden’s residents. Camden-based corporations have received more than $1.5 billion in state subsidies, and yet there’s precious little evidence that money created a sustainable economic foundation that benefited local workers or businesses.

The Camden We Choose delivered petitions to the Camden City Council last month, kicking off an effort to make the corporations that benefited from subsidies reveal whether they’re actually hiring local workers. Under New Jersey law, about 20% of municipalities are governed by the Faulkner Act, which allows petitioners, if they collect enough valid signatures, to force a city council to consider and approve a new ordinance. If the council doesn’t meet the petitioners’ demands in some way, the proposed law goes before voters for a referendum.

The coalition proposed a new rule that city businesses with more than 25 employees must disclose how many of their employees are from Camden and submitted enough signatures that the council will likely have to take up the matter or put it on the ballot.

While the rule, if adopted, would apply to all city businesses, the intended targets are those corporations that received state subsidies — for very good reason. “These corporations received more than a billion dollars in state subsidies — supposedly to bring jobs to a city that has long suffered from disinvestment and poverty, and we’re supposed to accept that without data? On what planet?” said New Jersey Working Families Party director Sue Altman.

Indeed, this is vital information for the community to have, and a way to make public what everyone suspects: That few Camden residents benefit from the programs ostensibly aimed at them.

To be very clear, there is no connection between corporate subsidies of the sort New Jersey spends billions on every year and any measure of economic benefit that normal people care about. They don’t produce job growth, income growth, or expand local economies.

They do, however, generate political donations and votes for incumbent politicians, thus creating a vicious cycle in which dominant corporations receive public dollars and repay that favor with campaign funds, entrenching power in the hands of dominant corporations and political elites. Many studies have found that there is a clear nexus between corporate subsidy spending, campaign contributions and political corruption.

In fact, the first documented corporate tax incentive in American history went to Alexander Hamilton for a manufacturing campus in Paterson. It failed spectacularly,thanks, in large part, to the corruption of Hamilton’s associates.

Camden residents, New Jersey taxpayers, and those who want fair, transparent government across the country, deserve better. The good news is that, generally, when transparency measures such as this one get on the ballot, they pass overwhelmingly, because regular folks get it: Corporate subsidy deals don’t work for them, and were never meant to. It’s great to see Camden residents take matters into their own hands in order to reveal the way in which their state leaders have failed.