Booker's Bad Boondoggle Answer
The 2020 hopeful was asked about New Jersey's big tax break scandal. It didn't go well.
|Aug 29, 2019||1|
During a Q&A session with the Working Families Party this week, 2020 presidential candidate Cory Booker was asked about a controversy in his home state of New Jersey. It involves some of the state’s poorest residents getting hosed by thoroughly corrupt economic development programs.
His response was very bad.
First, some background: New Jersey is in the midst of a huge fight over its corporate tax incentive programs. An audit initiated by Gov. Phil Murphy revealed the programs are comically corrupt, with politically connected insiders literally rewriting them in order to benefit their clients. (Check out this piece I did for The Nation to get the full picture.)
Camden, the poorest city in New Jersey and one of the poorest in the nation, has been especially hurt by this wheeling and dealing, as $1.1 billion meant to boost the economy and create jobs for local residents instead just lined the pockets of, among others, political boss George Norcross, an at-this-point infamous leader in Jersey’s Democratic Party machine, as well as his family, clients, and cronies.
The tales out of Camden are truly wild. As I noted here, one corporate tax break meant to bring grocery stores into Camden’s food deserts was rewritten by a lawyer to help his client, ShopRite, via explicitly keeping out other grocers. When ShopRite pulled out of the project, Camden wound up with nothing.
In another instance, a company was granted taxpayer money to build a helipad and only backed down after public shaming. Several companies were caught inventing threats to move to another state out of whole cloth — never intending to actually leave — in order to qualify for more public money.
Overall, Jersey has thrown billions of dollars at big corporations and received precious little for it — other than “the ugliest damn building in New Jersey and maybe America.”
When asked about all this, here’s what Booker said:
BOOKER: In Newark, we fought and won using some of these incentive bills that were passed through the legislature. We were able to get into Newark our first new supermarkets in decades, to get rid of food deserts, we were able to get first new hotels built in decades in our city.
And we did community benefits agreements, because I don’t believe that gentrification is the solution to any of our problems. If you’re coming to Newark, and I’m proud that my city council stood with me, and the current mayor, in fact we just had a big gentrification conference in Newark, that if you’re going to build you have to make the community part of the building.
So in the same way as my philosophy, we brought people to the table and made sure that our kids had apprenticeship programs to get union jobs, that even our unions had to hire more African-Americans and Latinos into their union, and we were able to work with them to make sure that a third of the work, for example, on that first new hotel in our city was going to actual Newark residents.
We believe that in our city that there should be other community benefits and actually you should be contributing to funds that help forward the building of affordable housing, and we were very fortunate under my leadership to double the production of affordable housing, the rate of production in my city. So I’m proud of some of these same laws that may not be working in Camden, as you say, but they really helped us to attract development to the city of Newark and do it in a way that creates shared growth and shared opportunity.
He then spent another three minutes talking about campaign finance, agriculture, and housing policy. And, sure, that all sounds nice, if extremely unspecific.
The problem is: Never once did he mention corruption. He didn’t mention Norcross by name, only alluding to “that individual,” and even then it was just to dispute the amount of money the questioner alleged Norcross had raised for him. Nothing about the $1 billion that was meant for Camden residents who never saw it. Zip about Camden’s grocery store debacle. A huge amount of questionable activity has been uncovered in New Jersey — with huge government reports and long articles in the local papers — and Booker waltzed right by all of it.
I mean, c’mon.
It’s important to note that, before becoming a senator, Booker was mayor of Newark, New Jersey, which has relied really heavily on tax breaks to attract businesses. Since 1997, some $843 million has been spent there, that we know about, in state and local giveaways combined, most of that since 2010.
$200 million alone was spent on bringing Prudential’s headquarters to the city in 2012, when Booker was there. The city offered $2 billion for Amazon’s HQ2. (Tax breaks also cost Newark’s schools an “indeterminate” amount of money, but that’s a different story.)
So dumping on the very idea of corporate subsidies as an economic strategy would call into question a cornerstone of Booker’s case for being president: that he turned Newark around economically via smart policy choices.
And, look, maybe he truly thinks his tax deals for hotels and supermarkets were good ones, and that the agreements those companies made were worthwhile for the community. Just about every mayor thinks they’re a master negotiator. I’m dubious. For the reasons outlined here and here, incentivizing hotels and grocers doesn’t really pay off in the long term.
But leaving that aside, what occurred in the rest of the state, and specifically in Camden, is thoroughly and undeniably corrupt, even if — and that’s a big if — it was good for Newark. A program was literally rewritten by an outside lawyer in such a way that one of the most notorious food deserts in the country was kept without a grocery store!
That Booker couldn’t even bring himself to call out this almost cartoonish exploitation of his state’s taxpayers and poorest people says nothing good about the sort of policies he’s inclined to support.
Alas, this also wasn’t a one-off for Booker. He’s consistently gone to bat for Jersey’s broken tax incentive programs, including writing a whole op-ed about the raging success Camden has become because of them.
Fortunately, not every Jersey official is so sanguine about all this. Not only did Murphy get the whole investigation rolling, he recently vetoed the legislature’s attempt to steamroll through a reform-free extension of those tax break programs. Other state legislators are exploring a pact with surrounding states that would limit destructive corporate tax break competitions, much like the one Kansas and Missouri recently implemented for Kansas City. They’re doing really important work, while Booker is unwilling to merely condemn obvious chicanery and corruption.
I obviously don’t know whether that’s because he thinks these programs actually work — boatloads of evidence to the contrary — or because he’s too afraid to offend Jersey’s powerbrokers, but either way it’s a damn shame.
Thanks for reading this edition of Boondoggle. If you don’t subscribe already, just click the button below. If you do subscribe, send this around to friends, family, neighbors, or whoever you think might like it, and tell them to sign up too. And if you’d like to pick up a copy of my book, The Billionaire Boondoggle, go here.