Out of the Mouths of Babes
And, as with WIC, these cuts represent foolish policy. Researchers have documented the benefits of early childhood education for the past 40 years. A conference at the MIT Workplace Center in 2005 discussed the economic benefits of publicly funded preschool, and noted the irrational tendency of states during times of financial stress to subsidize businesses while reducing quality early education programs. “Investing in early education generates economic development for communities in the short run in the form of jobs, the purchase of goods and services, and a more efficient workforce. In the long run, quality early education builds an employable, educated workforce,” concluded a report from the conference titled “Early Childhood Education for All: A Wise Investment,” written by Leslie Calman and Linda Tarr-Whelan. Their report, which confirmed what dozens of longitudinal studies across the country have found, went on to say: “Children who receive quality early education arrive at school ready to learn and they do better in school. They need fewer costly special education classes. They are more likely to graduate from high school and to hold jobs. They are less likely to be on welfare. And they are significantly less likely to wind up in the courts and in the jails and costing taxpayers a fortune.”
And yet stating the obvious — that preserving the safety net for those most in need requires higher taxes on those most able to pay — is out of political fashion. Making deep cuts in social services now passes for sound fiscal management at all levels of government.
Meanwhile, we are using tax breaks to entice companies to come to Massachusetts — and to convince them to stay — even though there is little evidence the strategy works.
Tax incentives, credits, and state subsidies to businesses in the name of economic development are costing Massachusetts more than $2 billion a year. And yet, in two recent notorious cases, such munificence didn’t produce the desired effect. Evergreen Solar packed up and left 800 Massachusetts residents out of work only two years after the renewable-energy firm built a factory in Devens using $58 million in taxpayer dollars. And then there’s Fidelity Investments, which, despite 15 years of generous tax incentives, this spring moved more than 1,000 jobs to New Hampshire and Rhode Island. Fidelity, by the way, continues collecting its tax breaks to this day.
With governor after governor in Massachusetts, businesses pull a kind of corporate blackmail. It began in earnest in 1995, when Raytheon Corporation threatened to leave the state — and the company’s local workforce — behind unless the commonwealth and Governor Bill Weld gave the local defense contractor millions in tax incentives. Once it got them, Raytheon went ahead and fired thousands of workers, anyway.
Just this spring, state Auditor Suzanne Bump released a report detailing the lack of accountability for companies that take the money and run. Going back decades, she reviewed 92 agreements for tax breaks or credits awarded to businesses, and found that only seven of them required a periodic review of their effectiveness or a reimbursement to the state if the company reneged on its commitments.
In the wake of the Evergreen and Fidelity rip-offs, Patrick now says he will consider whether beneficiaries of the state’s corporate welfare policies deserve more scrutiny. Shouldn’t he also be asking whether they deserve less taxpayer money? How about leaving just enough to feed the kids?