(The Center Square) – Growth in plants connected to electric vehicles has roared across the country.
When Virginia Gov. Glenn Youngkin said last week that he stopped efforts to establish a Ford Motors battery plant at a megasite in the state due to its Chinese partner, it was the first time University of Texas professor Nathan Jensen could recall a state rejecting an economic incentive deal for a battery plant.
Youngkin told reporters in a gaggle following his State of the Commonwealth address last week that his administration"felt that the right thing to do was to not recruit Ford as a front for China to America." During his address, he called on the General Assembly to send him a bill prohibiting"dangerous foreign entities tied to the [Chinese Community Party] from purchasing Virginia farmland.
What Jensen and economists who study incentives know is the data doesn’t back having the government give private companies funding toward new projects. The benefits don’t outweigh the payments and, in many cases, it is done for political benefits while politicians tout economic benefits that go unfulfilled.
His group recently called Georgia’s $1.5 billion incentive for a Rivian EV plant the"worst economic development deal of the year" for 2022. He believes states should welcome EV plants, but not give economic incentives. The state also recently agreed to spend $90 million to develop 21 industrial sites across the state, including $1.5 million for Berry Hill. Additionally, in his proposed budget amendments unveiled in December, Youngkin included $50 million for the Business Ready Sites Fund, which he touted as an investment that would spur greater workforce development in the commonwealth.
Georgia, Kansas, Michigan, Nevada, North Carolina and Tennessee have all pledged to give at least $1 billion to an individual EV project. Those numbers don’t include 53 projects where the subsidies weren’t disclosed, or the costs that are unknown for the 51 known deals.
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