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[ ARCHIVE ](https://www.citywatchla.com/archive)
# Corporate Welfare & Tesla
September 11 2014
Written by Greg Nelson.
[](https://www.addtoany.com/share)
CONSIDER THIS-Nevada outbid California for Tesla’s new battery plant, and the cost was high.
I’m guessing that, as is the case with proposals to build sports stadiums and arenas, the benefits were overstated.
It’s not an entirely bad idea for governments to provide financial incentives for businesses to stay in the area, and to invite new ones locate here.
But what's missing on a city and state level is any sort of economic development policy to guide the corporate welfare programs.
Instead each proposal is handled separately, and the winners tend to be those with best political connections, and not necessarily the ones with the best projects.
And such a plan must be developed with the assistance of impartial experts, such as university professors.
As the process is now, developers hire economists to write “build-to-suit” reports that exaggerate the benefits, and understate the costs. The researchers know what they need to do to please their client, and ensure future contracts.
In Los Angeles, for example, the city should decide what type of businesses it wants to attract, which ones it wants to attract, inventory its possible incentives, and advertise for takers.
If the city doesn’t do this, it will end up giving away valuable taxpayers’ money and assets to just any developer who comes along with a proposal to build a shiny and lucrative monument to themselves.
***(Greg Nelson is a former general manager of the Department of Neighborhood Empowerment, was instrumental in the creation of the LA Neighborhood Council System, served as chief of staff for former LA City Councilman Joel Wachs … and occasionally writes for CityWatch. He can be reached at)*** ****-cw****
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CityWatch
Vol 12 Issue 74
Pub: Sep 12, 2014
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