Foxconn to Build $10B Factory in U.S | Hacker News Reader

Foxconn to Build $10B Factory in U.S

wsj.com

137 pointsdcgudeman147 comments

$3 billion in subsidies for 3,000 jobs.

http://www.jsonline.com/story/news/2017/07/26/scott-walker-h...

$1,000,000 per job seems like a staggering subsidy.

Seems like it'd be cheaper to just give it away as UBI, no? Especially considering a million dollars for a transient job versus paying someone a million dollars over their lifetime.

This whole late stage capitalism transition is going to be painful.

> "late stage capitalism"

What does this even mean? Sounds like an activist buzzword. What evidence do we have that there are even "stages" to capitalism much less that we are in a later stage?

https://en.m.wikipedia.org/wiki/Late_capitalism

Capitalism is showing its flaws if we're paying a million dollars per job just to bring the job to our soil, although I suppose it's better then just keeping Foxconn products (or products that integrate their components) out at ports (or tariff them, like Russia with phones without a GLONASS chipset).

Tax incentives are not the same as cash payments

Forgoing revenue is the same as forgoing a payment.

Is there a way to find out how much Foxconn pays in U.S. taxes right now? Or how much revenue they earn in the U.S.? If Apple has Foxconn make phones in Taiwan, and Apple then ships phones to the U.S., then Foxconn doesn't pay any taxes to the U.S. on those transactions, right? Only Apple would right? If Foxconn doesn't pay any tax to the U.S. right now (???), and they build a factory in the U.S. and don't pay any taxes in the future, then it is a wash (except for now the U.S. employees would be paying income tax, etc.). Or am I missing a piece of the puzzle? (As in, maybe Foxconn is currently paying a lot in U.S. taxes from whatever operations they have in the U.S. currently?)

i assume theyre talking about payroll tax

Let's say you want to take a portion of my income in exchange for career services that has a cost of 1,000 dollars a year for you to provide.

You say "pay me 20% of your 100k job" netting you 19k, I refuse to pay that steep of a fee and counter with "take 10% or nothing" netting you 9k.

I don't believe its fair to say that you have lost 10k if you accept my terms as the alternative is receive nothing. You have increased your revenue by 9 thousand dollars as opposed to earning 0 dollars. The option you proposed is simply not on the table and can't really be considered.

I think you are offering up a false alternative.

It really is a choice between three outcomes. (1) No factory is built, no taxes collected. (2) Factory is built, company pays full sticker price on the taxes. (1) is unappealing because nothing is created. So we arrive at (3), where the company understandably wants to renegotiate the sticker price on the taxes and the taxing body doesn't want to end up in scenario (1), so they come to an agreement somewhere in the middle.

Why is this translated into the company received cash from the taxing entity?

Those taxes are a cost of doing business in the state - akin to the rent on a property. If nobody wants to rent your property at your asking price, you can let it sit empty and get zero, or lower your price and get more than zero. You are not "forgoing" anything by lowering your price in that case. You never had that revenue to give up in the first place.

> Tax incentives are not the same as cash payments

They are exactly equivalent to cash payments without the special tax treatment, so, yes, they are very much the same.

Not based on what the article says. If the factory never would have been built in the first place, the taxes never would have been paid.

Before: 0 jobs, $0 taxes (factory doesn't exist)

After: 13,000 jobs, $100M taxes (down from $300M if no tax concessions were given, as per article)

The incentives would cost the state about $200 million a year but Foxconn's payroll in Wisconsin could reach $700 million a year, Walker's office said.

Also the $3B is the cost over a decade, not in a single year.

> If the factory never would have been built in the first place, the taxes never would have been paid.

That does not make the incentives any difference than a cash payment in exchange for building the factory.

> The incentives would cost the state about $200 million a year but Foxconn's payroll in Wisconsin could reach $700 million a year, Walker's office said

The relationship between “would” and “could” in that sentence is quite important.

> That does not make the incentives any difference than a cash payment in exchange for building the factory.

Sure it does. A state writing a check for, say $100 million dollars requires spending $100 million dollars (possibly borrowing it to do so). Giving $100 million dollars in tax reductions requires spending $0. The former may not be feasible, while the latter generally is, so the two are not equivalent.

Giving $100 million in tax incentives, conditioned on a specific act, requires just as much spending (or more, if the income from the cash payment itself would have been taxable) as giving a $100 million cash payment, with the same conditions, with no special tax treatment.

That people can fail to see this may explain why these deals are politically popular, though.

There is no cash payment. The alternative to not giving the tax concession is not getting any tax revenue from the company.

Now, if you wanted to complain about companies taking the tax break and not following through, I'd agree with that.

I don't see it that way.

Let's create another scenario. We are family members. Whatever I earn, I give you half.

Scenario A: I never get a job, you end up with $0.

Scenario B: I get a job, but only if you agree to take 25%, not 50%. I take the job paying me $100 and you get $25.

It's not cash out of anyone's pocket.

If you keep more of your money through a change in tax policy, you are suggesting that the government gave you money? I'd argue that you are keeping what was yours all along.

Being bled less isn't the same as receiving a blood donation.

> If you keep more of your money through a change in tax policy, you are suggesting that the government gave you money?

That's a complicated question in the case of generally applicable changes in tax policy, like a new tax credit available to anyone who posts on internet discussion boards.

It's a simple, straightforward “yes” when the change in tax policy only applies to me, and only for a specific action (post on HN about the Foxconn factory deal, and get $5000 of your federal income tax.)

The latter is more like a government contract (but without the competitive aspects and other controls designed to assure fairness and public value.)

Corporate welfare has existed in every "stage" of capitalism, and the justifications suit the political moods of the day (jobs for one polity, greentech for another). This isn't anything new, and capitalism would be better off without it.

That's not capitalism.

The outsourcing and automation and optimizing away of blue collar American jobs was already capitalism working as intended. Somehow, Trump and the Republicans have sold middle America a bill of goods and convinced them that globalism and capitalism are opposed to one another, when they are the same.

What's happening here is very much anti-capitalist.

Therefore, you could consider the "need" for this to happen in the first place, a "late-stage" flaw of capitalism.

I think you agree with the OP?

I think he is saying that this is not capitalism. The existence of bailouts and government programs to direct the markets is not capitalism's 'need' for those programs, despite any politician's attempt to sell that idea.

I kind of halfway agree with the OP, I just wouldn't consider it a flaw of capitalism.

From a capitalist point of view, blue collar jobs lost in the US to outsourcing and automation deserved to be lost. The market optimized for a better solution for consumers, and that solution was cheaper labor and automation.

A true pro-capitalist party would admit that, rather than pander to coal miners and steel workers, and would try to make the US more competitive in the modern, global marketplace rather than try to drag the entire world back into the tar pit of American industrial dominance.

A true pro-capitalist party would even embrace socialist programs like nationalized healthcare and education, if that would make it easier for displaced workers to re-educate themselves and re-enter the workplace, and compete more readily with labor throughout the world, and take the burden of healthcare off of employers. Invest in infrastructure and technology. There's probably even a capitalist argument for basic income allowing the repeal of the minimum wage.

But "write as big a check as necessary and party like it's 1949" is just pandering, it's not even a serious attempt at a solution for anything.

> The market optimized for a better solution for consumers, and that solution was cheaper labor and automation.

While not optimizing for the externality that those consumers are also the labor that's displaced thus destroying their ability to consume and thus not not a better solution for consumers after all.

The market is not magic, it fails often and it's very annoying to continually hear people brush off those failures with the no true Scottsman fallacy. If capitalism means to you only a perfect free market then it's a meaningless term because no such thing exists and more importantly that ivory tower definition is not what people are referring to when they use the word, capitalism as implemented in the real world is what they're referring to and jumping in and claiming "that's not capitalism" adds nothing to the conversation.

So yes, that is capitalism, because this kind of thing is exactly what capitalists do: they curry for favors from government to get into protected positions to avoid competition. Capitalism is what capitalists do, and this is exactly the shit they do. Crony capitalism is still capitalism.

> So yes, that is humanity, because this kind of thing is exactly what humans do: they curry for favors from government to get into protected positions to reap all the benefits.

FTFY. The problem you describe is a human problem that will happen in any system, capitalist, socialist or mix of the two. Power corrupts, absolute power corrupts absolutely. Capitalism simply provides power in a normal distribution proportional to wealth. Socialism provides power in a power law distribution and the head of that distributions constitutes absolute power.

It's a million dollars for 4-5 jobs, for whatever that's worth.

Many would argue that job subsidies like this are the opposite of capitalism. Under a free market, the government wouldn't be subsidizing anything.

> Many would argue that job subsidies like this are the opposite of capitalism. Under a free market, the government wouldn't be subsidizing anything.

Some would argue that this is exactly the point of the phrase.

So it's not capitalism at all. It's something else.

Undue influence of individuals with power (via money or other mechanisms) is hardly unique to capitalist systems. Every socialist country has had the exact same problems with corruption and misuse of power. It's also pretty trivial to argue that such corruptions and abuses are far far more toxic under socialism because there is no "pressure relief valve" in the form of competition. Socialism is predicated on a monopsony, and over time a market with a monopsony will likely result in monopolies on the sell side. You eventually end up with no alternative to the corrupt choices.

"Late stage capitalism" is a political term that was likely created by someone that considers themselves a temporarily embarrassed bolshevik central planner.

Capitalism existing under a state that will subsidize the needs of capital is still capitalism. There never was a period where 'pure capitalism' existed, so it's a bit disingenuous to claim that the system we have isn't capitalism.

It's a made up phrase that's being aggressively astroturfed on misc. parts of the net. reddit.com/r/latestagecapitalism

Every term is made up at some point but "late capitalism" itself isn't a new term[1].

[1] https://en.wikipedia.org/wiki/Late_capitalism

It's not an idea that's worth taking seriously, like everything else from Marx.

I'm dying to hear you expound on exactly what Marx actually says and why what he says shouldn't be taken seriously. Cites and quotes while you're at it, please. (No third parties, please--he clearly doesn't need the help.)

A basic primer is linked below for you. I'm sure you'll have wonderful, super duper insightful, and super smart commentary on it. Looking forward to it!

http://www2.ucsc.edu/whorulesamerica/theory/marxism.html

Have you read that piece? Because I have read it before, and Domhoff writes with regards to Marxists rather than Marx. If you're going to slag Marx for what Leninists and their derivatives have decided to read into it--well, that's a pretty curious thing to do. Not uncommon, because frankly most people haven't actually read Marx and are unqualified to opine, but I know for a fact that Domhoff has, which makes this...well, like I said--curious.

The one criticism of that article I do have as far as what people he perceives as "Marxists" think (and I'm not one, though I do think that the general shape of what Marx describes, as opposed to either Marx's end-state conclusions or Marxists-the-fear-object group might believe) is that social democracy, which I will helpfully point out is not "Marxism", has also fairly obviously demonstrated its bones over the last decade-plus, after the article's writing, as that late-capitalistic model has created additional, shitty stresses on populations. Free market uber alles has catastrophically failed in every nontrivial employment, and while heavily-planned or fully-planned economies have obvious problems, social democracies the world over have this tendency to mostly work. I won't call them a global maximum, because that's impossible, but they have a decent claim to a local one.

Anyway, let's be real: this isn't a "basic primer" and it doesn't contain the argument you thought it did after you googled "Marxism critique". You don't have to like the way things are going, but if you're gonna pretend to an opinion, maybe give it an honest go before you offer it?

>It's a made up phrase

Could you give any examples of phrases that exist but weren't made up?

> What evidence do we have that there are even "stages" to capitalism

Uh, the fact that history exists, and that within the set of historic systems which follow the basic system of property rights distinguishing capitalism [0], there's a clear sequence of different specific systems in history.

> much less that we are in a later stage?

The same is also evidence that the current stage is later than the previous ones, those it is admittedly speculative (until capitalism is displaced) that it is the latest stage.

[0] There's some debate over whether the mixed economy that is currently dominant in the developed world is properly a “stage” of capitalism (the system dominant in the 19th century and first labelled “capitalism” by it's critics) and not a successor system with some common features, but we can leave that debate aside for now.

Seems like a repackaging of the arguments against socialism. Arguments which are ridiculed here on HN "Just because most socialist states collapse into hotbeds of corruption doesn't mean it will happen here!"

This is from Marx, who wrote The Communist Manifesto, among other things. I won't try to summarize, other than to say Marx treats this ("late capitalism") as a developed state of capitalism, sort of a mathematical limit/end state, where certain things are taken to be inevitable.

While I understand that the use of the term 'mathematical limit' is meant to imply a stable equilibrium, in this context it does make it sound as if there are rigorous mathematical proofs that these unmentioned things are indeed inevitable. I'm not sure if that's what you meant to convey.

I think a better choice of word might have been "asymptote". Thanks for pointing this out.

At the risk of being a bit pedantic, limits don't imply stability, though, only that something is heading in a certain direction, and may or may not be reached.

>This whole late stage capitalism transition is going to be painful.

The phrase "late stage capitalism" is one I've seen crop up only in the last year or so, and mostly in the context of the subreddit of the same name.

Can you recommend some reading outside of that subreddit? I find the subreddit's content narrowminded to the point that I thought it was satire at first, but I'm open to the topic in general. Especially interested in what makes these (supposedly undesirable) aspects of capitalism "late stage" rather than just "fully realized". What I mean by that is much of what people complain about under the title "late stage capitalism" is just "regular capitalism less mired by things that aren't capitalism".

edit: also unhelpful is that the wiki describes it as a marxist idea representing an era from the 40s onward, while it's typically discussed in terms of changes that have occurred relative to times like the late 60s/reagan-era/post-ww2 era that are themselves technically "late stage capitalism"

Capital In The Twenty First Century: https://www.amazon.com/gp/aw/d/B00I2WNYJW/

The Economics Of Inequality: https://www.amazon.com/gp/aw/d/B013HZ8U0G/

Debt: The First 5000 Years: https://www.amazon.com/gp/aw/d/B00Q1HZMCW/

Boomerang: Travels in the New Third World: https://www.amazon.com/gp/aw/d/B005CRQ2OE/

The Global Minotaur: America, the True Origins of the Financial Crisis and the Future of the World Economy: https://www.amazon.com/gp/aw/d/B010VKP0CQ/

I'm mobile at the moment, but will noodle on further books that I'd consider contributors to the "late stage capitalism" school of thought (IMHO, as an amateur macroeconomic scholar). I am also open to rebuttals!

Late Capitalism by Ernest Mandel: https://www.versobooks.com/books/612-late-capitalism

I haven't read it since undergrad, but he broke up the stages of capitalism in three parts, with the earliest being a free market capitalism up until the mid 19th century, then monopoly capitalism up until around WWII, and late capitalism following that era. It is dominated by a pervasive industrialization that is fairly unrestrained by national borders and a global culture centered around mass consumerism.

Setting the specific numbers aside, I think providing subsidized jobs is generally a better idea than UBI.

American society places a lot of value on having a job, so it is important for people to have one to help maintain self worth.

I both respectfully and vigorously disagree. It's time we break down this sham that you require a job to have self worth.

If you automate yourself of a job, are you worthless now? Of course not! But we're still stuck with these silly societal moores that work and a job equate to value. No longer!

I don't disagree with you but I think we need to be cognizant of the best way to transition away from the current value system.

I worry a step change will fail badly.

What a deal maker. Trump says he doesn't want anyone laughing at the US anymore, but if I was Foxconn I'd be laughing my head off if I got the White House to endorse this deal.

This is pretty standard for deals like this, Nevada gave Tesla 1.3 billion for the Gigafactory. This "could" draw 3 billion. It's just tax incentives, not like it's a cash payment. But anything to make Trump look bad I guess.

There is essentially no difference between giving a company money and not collecting money from them that they would otherwise pay. Economists call these sorts of things tax expenditures. It amounts to taking money from some people and companies who pay their full tax bill, and giving it to others who don't.

Most of the "incentive" situations are not a choice between those two scenarios, they are a choice between having the business there and giving them an (initial) tax break, or having the business go elsewhere. It's a choice between collecting discounted taxes, or none at all, not discounted vs. non-discounted.

Except that it doesn't work like that.

What happens is that the jobs up and move as soon as the subsidy ends.

There has been quite a bit of research done on these kinds of tax subsidies and they almost always cost more than doing nothing and not getting the jobs.

So you claim that in five years Tesla will abandon their Nevada Gigafactory and build a new one in another state. Doesn't check out.

It's a typical prisoners' dilemma failure. The states ought to band together and pledge not to give out these tax breaks. Since they're all deciding independently, the incentive to defect and offer a tax break is high.

There's an enormous difference. They wouldn't otherwise pay it because their factory and jobs wouldn't otherwise exist.

But you could give the money to a company that already has a plant to develop new jobs. They don't because its untenable to see the government just write a big check to a private company.

Its a fictional difference that is used to make it seem more palatable.

You're discounting the other uses that money could have had if it wasn't taken from taxpayers and given to the favoured company. How many small businesses were pushed over the margin by the taxes that were necessary to raise enough money to give benefits to a foreign corporation? How many companies had to lay off a few employees?

Governments don't have a great track record of picking winners, and companies that are capable of stealing headlines don't necessarily have a bigger or better impact than thousands of unknown businesses.

There is an essential difference between being bled less (which is what these tax breaks appear to be) versus receiving a blood transfusion.

This should be the top comment. I was checking the post on the white house facebook page (https://www.facebook.com/WhiteHouse/posts/1385876754833387) and everyone is so skeptical. 10 billion investment + 13k people employed + discounted taxes - the sum total is a net positive for Wisconsin and a good deal.

The subsidy is $1.5B for 13,000 jobs. The other half of the subsidy is for capital investment and construction expenses.

It's still a huge number though.

The article states that: "At $3 billion for 13,000 jobs, the Wisconsin deal would cost $231,000 per job."

By comparison, economists have estimated $125K/job-year to $202K/job-year from the 2009 stimulus (ARRA). [1]

[1] https://files.stlouisfed.org/files/htdocs/publications/revie... , page 3

I'm confused about the comparison between cost per job and cost per job year. Presumably this (the Wisconsin deal) would be the better deal as the jobs presumably last more than one year?

Doubtful alot of the Recovery Act was for One Time Construction projects, like paving a road.

There were also alot of one off projects like sending people out to help with Energy Efficiency in homes.

There was not alot of long term stable jobs in there.

What about all the Wall Streeters bailed out? Those are long-term stable jobs, after a fashion.

Your first sentence suggests that you disagreed with my previous post, but your rationale very much supports my point. Spending 125-250K on a job that only exists for a year is markedly worse than paying a comparable amount for a job that lasts many years.

I dont think the government should be paying for any job.

I disagree with this corporate subsidy, and I disagreed with the Recovery act

That's fine, but my statement was neither for not against. Just observing that one appears to be a better bargain than the other.

That should just about cover Trump's first term.

Interesting to think of this as a highly inefficient welfare system for the electoral college.

Up to 13,000 jobs.

At this price is Foxconn actually investing anything or is it all taxpayer financed?

I think it's a mistake to describe it as taxpayer financed. The text I see in the article is all about a reduced tax bill.

"$1.5 billion in state income tax credits for jobs created, up to $1.35 billion in credits for capital investment and up to $150 million in sales tax exemptions on construction materials"

That's six of one, a half dozen of another given that tax rebates are a thing.

I wouldn't call it a rebate because that implies the full sticker tax bill and expected payment was already belonging to the taxing authority. You can't be rebated something back to you when it was yours to begin with.

Your link says 13,000. But even at that it's ~ 230K per job created.

Keep in mind that it's tax rebate, so Wisconsin is not getting any of that if they didn't lure foxconn to them in the first place.

Taxpayers are actually not funding any of this.

The money is effectively taken from wherever foxconn was gonna build this factory, like China, or Mexico.

> Taxpayers are actually not funding any of this.

Today if you buy an LCD monitor from Foxconn, they have to pay ~5% Wisconsin state sales tax. Under this deal, they get the rebate. So, taxpayers are paying with revenue they would otherwise have gained.

The sales tax credit is only for construction materials.

Foxconn is an OEM, nobody buys LCDs from them on the retail market.

I see a lot of people focusing just on the 3k jobs, but isn't building the multi-billion dollar plant going to inject some good money and jobs into the economy as well?

Yeah that's why article says it is gonna generate 22000 indirect jobs.

Additionally, there must be worse things to blow three big ones on.

In FY 2015, Pentagon and related spending totaled $598 billion, about 54% of the fiscal year 2015 U.S. discretionary budget.

1. https://en.wikipedia.org/wiki/Military_budget_of_the_United_...

I find it hard to believe that they won't automate it to the max. They've started to do it in china, why wouldn't they do it here where labor is more expensive and the factory is brand new. Foxconn has been manufacturing for a long time and they are looking to reduce costs not increase them by building in the US. Automation is the best way. I bet the jobs are not long term.

Some jobs are better than none but don't pat your back with congratulations.

They don't want to have problems with current US administration and Trump wants factories, so they give him factories.

Meaning the automation starts as soon as Trump leaves.

No, it means it starts on day one. As with Carrier, Trump wants things he can announce, but once he's gotten an announcement out of it his interest is done.

Automated new factories here in the homeland is still better for us than empty factories.

Maybe, they get very large tax breaks plus the take up resources. It's probably a breakeven situation.

>>as soon as Trump leaves

the room. The automation starts as soon as Trump leaves the room after giving himself his little back pat.

Maybe if we all pitched in a couple bucks, we could buy Mr. Trump a copy of Factorio.

like when carrier said they wouldnt outsource jobs and then almost immediately outsourced the jobs?

promises to the president are meaningless. He cant take away their factories or force them to hire people.

And promises like foxconn's frequently turn out to be the most optimistic number they can think up, to drum up good press and subsidies from politicians looking to show results to their voters.

I watched a doc on the Foxconn factory that made iPhones (and other phones) and I was surprised at the amount of manual labour that went into manufacturing them.

I think it's a case of creating something like a phone requires a lot of intricate internal wiring that robots simply can't do right now. Robots struggle with variable pressure, to pick up delicate objects, and a phone would be much trickier to do. There seem to be advances in the latter, and I think Amazon is really trying to get it to work for their warehouses, and I do hope that there are advances on this front due to the terrible chemicals used in electronics manufacturing that cause cancer, infertility, and other ailments, but it will likely be a while until the technology advances enough.

This reminds me of the 1B apple datacenter announcement in 2011 that ultimately created 50 jobs. Reality sux.

http://www.businessinsider.com/apple-new-data-center-north-c...

From a Reuters article: "In 2013, Foxconn said it would invest $30 million and hire 500 workers for a new factory in Pennsylvania, but that facility was never completed." So I wouldn't hold my breath.

What, 13,000 factory workers? Foxconn isn't going to use mostly robots? Gou has said he wants to get rid of the "animals" in his plants.

3,000 workers according to Foxconn. The trump administration has said it could create up to 13,000 over the coming years, so who knows what that really means...

I heard on the news that 10,000 construction jobs would be created, so perhaps both are right - 10,000 temporary construction jobs, and 3,000 permanent/plant jobs.

You mean like all the jobs the Keystone Pipeline was going to create that looks closer to less than 100 in the long term? http://money.cnn.com/2017/03/24/investing/keystone-pipeline-...

Counting temporary construction jobs as permanent seems a little misleading.

Politicians mislead to look better?!?

Though you are right, this looks like an exceptionally misleading deal from the point of view of the taxpayer. When I think of Foxconn workers I dont think of the kinds of jobs I think we would want to heavily invest in, but I hope I am wrong.

They would love to use mostly robots. It's political decision, not economic one.

Are the majority of these 13,000 jobs likely to be minimum wage?

What do u expect? It is Foxconn, it needs bloody labor not Google engineers.

Walmart and Amazon pay well above the minimum wage. It might be because they are so altruistic but I suspect they can't find labor worth keeping at that price. I imagine the same will be true for foxconn.

"Well above" isn't super meaningful. I believe Wal-mart's minimum pay is 9/hr and most employees are closer to 12-13. That's not going to be a livable wage in many areas. Add in that half of those are part time and not getting employee supplemented health insurance and it gets less livable.

Walmart has a national minimum of $10 an hour the federal minimum is $7.25. I consider a roughly 25% premium to be a significant increase when talking about salaries. My comment is in regards to these jobs paying minimum wage and the evidence leads me to believe that it is virtually certain that these jobs will pay a significant percentage more than that. (not to mention all the managerial and skilled labor jobs that will pay many times more that will come with them)

Walmart was forced to offer $10 an hour because they were facing staff shortages. The interesting thing is that their profits certainly didn't nose-dive after the bump in their labor's wage rate.

Yes, but the minimum wage is the US is abysmal, and "well above" abysmal is still basically subsistence in many places.

The labor is technical, which at least in the U.S. usually carries higher wages. Chinese workers might be accustomed to low wages in technical jobs, but I don't see Joe Bob quitting his minimum wage burger-flipping job and go work at Foxconn assembling iPhones at minimum wage.

If that is the case, then they will deploy robots, use few human supervisors to oversee the work. Don't expect it will bring their giant manufacturers pipeline here. It is not going to be profitable for them. Why, because Chinese people are cheaper, and for manufacturing, meaning assembling, your output is directly associated with your working time, where in China they can force workers to work 12 hours, here no chance they could do that.

It might not be cheaper if you think Trump is going to tariff China because of their support of North Korea.

Well lets see. If Trump is still willing to sell more agricultural products to China to narrow down the deficit, he needs to play this nicely.

"It would initially employ 3,000 workers making an average of $53,900 a year plus benefits and could eventually boast more than four times that"

from article

>"This is a great day for American workers and manufacturers and everyone who believes in the concept and the label 'Made in the USA,' " said an ebullient President Donald Trump at the White House announcement."

Why is this great for American manufacturers exactly? I'm guessing Trump doesn't know that Foxconn is a Taiwanese company? That sounds about right.

Foxconn has more factories in China than in any other country and their largest factory is in Shenzhen.

The implied "Made in USA" vs "Made in China" is fair.

My comment was very clearly asking about the "American manufacturers" part of the quote not the "Made in USA" part.

Foxconn has factories around the globe but they are a Taiwanese manufacturer not an American manufacturer, they are traded on the TWSE:

https://en.wikipedia.org/wiki/Foxconn

That's a one time cost.

Sounds reasonable when you compare it to California spending $21 Billion each year to subsidize 3 million people.

This is a giant photo op good will by Foxconn. Just like the Carrier announcement. My bet is that there won't be any factory, and even if there is it would be a small outpost employing a handful of people. All financed by giant taxpayer subsidies

The subsidies are tax credits. They make the location more attractive, they don't finance the project.

The subsidy turns lost tax revenue (taxes == slavery) into jobs for US citizens. Please explain how this is a bad thing?

Thanks for your input, 4 minute-old account!

without paywall: http://archive.is/SiGPl

Apparently US labor is cheaper then Chinese.

Wow!

Almost correct. It's the overall cost equation that is important, not just labor though.

"U.S. Manufacturing costs are almost as low as China’s, and that’s a very big deal"

http://fortune.com/2015/06/26/fracking-manufacturing-costs/

"These days, China's labor costs are only 4% cheaper than those in the U.S. when productivity is factored in, according to Oxford Economics. "

http://money.cnn.com/2016/03/17/news/economy/china-cheap-lab...

This will be in Paul Ryan's district. Fishy enough?

Outer Milwaukee is a logical place to build a large factory in Wisconsin. So hard to read much into that particular aspect of it.

For anyone actually interested in learning how hard southern Wisconsin has worked to get manufacturing back after the GM plant closure, I recommend Janesville: an American Story. Suffice to say that many, many people both R and D want these jobs in Paul Ryan's district and willingness to offer incentives is fully bipartisan. https://www.amazon.com/Janesville-American-Story-Amy-Goldste...

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