Practice English Speaking&Listening with: WPT Here and Now: Exploring Foxconn's Wisconsin Plans

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>> IF I DIDN'T GET ELECTED, HE

DEFINITELY WOULD NOT BE SPENDING

$10 BILLION.

>> AND FOR SOUTHEASTERN

WISCONSIN, THIS IS AN ABSOLUTE

GAME CHANGER.

>> FROM WASHINGTON, PRESIDENT

DONALD TRUMP AND SPEAKER PAUL

RYAN ON WEDNESDAY UNVEILED A

PLAN FOR FOXCONN PLANT IN

WISCONSIN.

I'M FREDERICA FREYBERG.

TONIGHT ON "HERE AND NOW."

A FIRST LOOK AT WHAT WE KNOW

ABOUT THAT PLAN, AND THE CLOSER

LOOK AT THE FOXCONN CORPORATION

FROM A BEIJING-BASED INDUSTRY

EXPERT.

THEN, A LOOK AHEAD AT OPTIONS

THE LEGISLATURE FACES TO FINANCE

THE INCENTIVE PACKAGE FOR

FOXCONN.

INCENTIVES PEGGED AT $3 BILLION.

LATER, A SELLER'S MARKET FOR

PROPERTY OWNERS IN SOUTHEAST

WISCONSIN AS FOXCONN EYES

LOCATIONS.

IT'S "HERE AND NOW" FOR

JULY 28TH.

>> FUNDING FOR "HERE AND NOW" IS

PROVIDED IN PART BY FRIENDS OF

WISCONSIN PUBLIC TELEVISION.

>> WE JUST HEARD FROM PRESIDENT

TRUMP AND HOUSE SPEAKER RYAN IN

WASHINGTON, GIVING A CHEER FOR

THE PROSPECT OF A FOXCONN

OPERATION IN THE BADGER STATE.

BACK AT HOME, GOVERNOR SCOTT

WALKER HELD A MILWAUKEE WELCOME

PARTY ON THURSDAY EVENING.

ZAC SCHULTZ WAS THERE.

>> GOVERNOR WALKER AND THE

FOXCONN CHAIRMAN SIGNED A

MEMORANDUM OF UNDERSTANDING, THE

NEXT STEP FOR FOXCONN'S FIRST

FACTORY IN THE UNITED STATES.

>> WOW.

THIS IS A BIG DAY FOR WISCONSIN,

IT IS A BIG DAY FOR FOXCONN.

>> THE FIRST PHASE OF THE

$10 BILLION FACTORY IS EXPECTED

TO BE OPERATIONAL BY 2020, AND

PRODUCE LIQUID CRYSTAL DISPLAY

PANELS, OR L.C.D. SCREENS, FOR

THINGS LIKE TELEVISIONS.

>> WITH THIS DEAL, THEY WILL BE

MADE IN AMERICA, PROUDLY IN THE

GREAT STATE OF WISCONSIN.

>> WISCONSIN BEAT OUT SEVERAL

OTHER STATES COMPETING FOR THE

FACTORY.

AND CHAIRMAN GO CREDITED

GOVERNOR WALKER AND THE PEOPLE

OF THE STATE.

>> WHY WISCONSIN, PEOPLE.

PEOPLE SHOULD TRUST EACH OTHER.

>> THE DEAL WON'T COME CHEAP.

IF FOXCONN CREATES THE PROMISED

13,000 JOBS, OVER THE NEXT 15

YEARS, THEY WILL RECEIVE

$3 BILLION IN TAX CREDITS FROM

THE STATE AND MORE BENEFITS FROM

LOCAL GOVERNMENTS.

>> WHICH IS BIG, BIGGER THAN

ANYTHING WE HAVE DONE BEFORE.

BUT IF YOU WANT TO PLAY IN THE

BIG LEAGUES, IT'S COMPARABLE

WITH JUST ABOUT EVERY OTHER

MAJOR FINANCIAL INCENTIVE LIKE

THIS FOR A MAJOR PROJECT, NOT

ONLY THE COUNTRY BUT THE WORLD.

>> SO FAR, MOST DEMOCRATS LIKE

PETER BARKA ARE SUPPORTIVE OF

THE PROPOSAL.

>> THE OPPORTUNITY IS VERY

EXCITING.

>> BUT HE KNOWS THERE ARE

CONCERNS ABOUT THE SIZE OF THE

TAX CREDITS.

>> I KNOW THAT THERE WILL BE

SOME PUSHBACK, NO QUESTION ABOUT

IT.

ON THE OTHER END OF THE

SPECTRUM, IT'S NOT JUST THE SIZE

OF THE PACKAGE, YOU HAVE TO LOOK

AT, YOU KNOW, THE RETURN ON

INVESTMENTS.

>> IT'S A REALLY BIG NUMBER, BUT

REMEMBER, IT'S PAID OUT OVER 15

YEAH, ONLY WHEN PEOPLE ARE

ACTUALLY HIRED AND THESE ARE WAY

MORE THAN FAMILY-SUPPORTING

JOBS, WHAT WE WANT IN WISCONSIN.

>> THE NEXT STEP REQUIRES THE

LEGISLATURE TO GO INTO SPECIAL

SESSION AND PASS THE STATE

INCENTIVES INTO LAW.

ASSEMBLY SPEAKER VOSS SAYS IT

WILL HAPPEN BY MID AUGUST.

LEGISLATURE WON'T HAVE MUCH SAY

OVER THE DETAILS.

>> MOST OF THE DETAILS HAVE BEEN

DONE BY THE CORPORATION, WE HAVE

TO DO DUE DILIGENCE, GUARANTEES

IN THERE.

>> THE DEAL CAME TOGETHER OVER

THE LAST FEW MONTHS AND WHILE

THINGS ARE MOVING QUICKLY,

GOVERNOR WALKER THINKS THE

IMPACT ON WISCONSIN WILL LAST

FOR GENERATIONS.

>> THIS IS SOMETHING THAT WILL

SAY TO THE WORLD WE HAVE

ARRIVED.

THE EAGLE HAS LANDED AND IT

SPREAD ITS WINGS AND TAKEN OFF

AGAIN.

WE ARE READY.

>> ZAC SCHULTZ REPORTING.

>> CLOSER LOOK, WE GO TO

BEIJING.

CAUGHT UP WITH AN ECONOMIC

DEVELOPMENT EXPERT IN CHINA WHO

ADVISES CLIENTS ON FOREIGN

TECHNOLOGY STRATEGY AND

ACQUISITIONS.

HE IS VERY FAMILIAR WITH FOXCONN

AND ITS CHAIRMAN.

HE'S ALSO VERY FAMILIAR WITH

WISCONSIN, HAVING ATTENDED

COLLEGE AND LAW SCHOOL HERE.

ALSO WORKING HERE FOR MANY

YEARS, INCLUDING AS CHAIR OF THE

WISCONSIN INTERNATIONAL TRADE

COUNCIL.

IN A SKYPE INTERVIEW WE STARTED

BY ASKING EINAR TANGEN HIS

REACTION TO WISCONSIN LANDING

FOXCONN.

>> I THINK IT CAN BE TREATED, IF

IT'S GOING TO BE FORWARD, AS AN

OPPORTUNITY.

THE CORRIDOR BETWEEN MILWAUKEE

AND CHICAGO HAS BEEN TOO LONG

OVERLOOKED.

IT COULD BE THE NEXT SITE OF A

VERY, VERY GOOD TECH CORRIDOR

THAT COULD HELP BOTH WISCONSIN

AND ILLINOIS DEVELOP THEIR

ATTRIBUTES.

THIS IS A WONDERFUL AREA.

WE'LL SEE HOW IT DEVELOPS.

>> DO YOU THINK WISCONSIN HAS

THE TECHNOLOGICALLY TRAINED WORK

FORCE FOR THIS KIND OF

OPERATION?

>> NOT CURRENTLY, BUT YOU DO

HAVE RESOURCES, QUITE FRANKLY, I

WOULD ADVISE THAT WISCONSIN GET

TOGETHER WITH ILLINOIS ON THIS

PARTICULAR PROJECT BECAUSE A LOT

OF PEOPLE FROM ILLINOIS ARE

GOING TO BE FILLING THE GAP THAT

EXISTS IN THESE AREAS.

THESE ARE AREAS WHERE, YOU KNOW,

TRADITIONALLY BLUE COLLAR

INDUSTRIES, SOME TECH, BUT VERY,

VERY SMALL, CERTAINLY NOT ENOUGH

TO FILL THE GAP HERE, I WOULD

EXPECT PEOPLE COMING UP FROM

ILLINOIS, NORTHERN ILLINOIS,

COMING THERE TO WORK.

ILLINOIS OBVIOUSLY HAS A VERY

LARGE TECH CORRIDOR BETWEEN THE

UNIVERSITIES AND WISCONSIN AND

ILLINOIS.

I THINK THERE WOULD BE ENOUGH TO

FILL THE PIPELINE FOR A FACTORY

LIKE THIS.

>> YOU SAID YOU THOUGHT FOXCONN

WOULD HAVE EXPECTED CLOSE TO

$5 BILLION IN INCENTIVES TO

LOCATE IN WISCONSIN.

EVEN 3 BILLION IN INCENTIVE THAT

THE GOVERNOR IS ANNOUNCING, IN

YOUR MIND, IS THAT A GOOD DEAL

FOR TAXPAYERS AND CITIZENS?

>> DEPENDS HOW YOU LOOK EIGHT.

THE AVERAGE PERSON WILL DECIDE

IT'S NOT A GOOD DEAL.

THEY SAY THE ENORMITY OF ALL THE

ISSUES GOING ON WITH FINANCE,

HEALTH CARE, ETC., THIS IS --

REMEMBER, A VERY REGION-SPECIFIC

BENEFIT.

THE IDEA THAT THE STATE IS GOING

TO SUPPORT THIS AREA IS GOING TO

BE A HARD PILL TO SWALLOW FOR

THOSE IN MAYBE PERHAPS NORTHERN

WISCONSIN WHO SEE VERY LITTLE OF

THIS KIND OF ACTIVITY AND THEY

ARE GOING TO WONDER WHY THE

MONEY IS BEING SPENT.

ON THE OTHER HAND, THE BUSINESS

COMMUNITY WILL PROBABLY SEE THIS

AS A LONG-TERM OPPORTUNITY.

THERE WILL BE REAL ESTATE

DEVELOPMENT, FORTUNES TO BE

MADE, CONSTRUCTION, THERE WILL

BE A LOT OF ACTIVITY, PERHAPS

ECONOMIC MULTIPLIER THAT

JUSTFIES THIS.

>> AS FOR FOXCONN'S BUSINESS

MODEL, LABOR COSTS AND WORKER

CONDITIONS IN CHINA OR

ELSEWHERE, HOW DOES THAT

TRANSLATE TO WISCONSIN?

IT'S OBVIOUSLY VERY DIFFERENT

HERE.

>> YES.

IF YOU LOOK AT THE OTHER

COUNTRIES, 7 TO 9 COUNTRIES, HOW

THEY ARE IN, LOW LABOR COSTS,

TEND TO BE THE COMMON

DENOMINATOR.

WISCONSIN, OBVIOUSLY IS NOT

GOING TO BE THAT.

>> NOW, MORE SPECIFICALLY WE

HAVE ALL READ ABOUT CONDITIONS

BEING SO BAD AT SOME OF THESE

CHINESE FACTORIES THAT FOXCONN

HAD EMPLOYEES DYING BY SUICIDE.

WHAT SHOULD WE KNOW ABOUT

CONCERNS OVER THAT KIND OF

EXTREME, THAT PEOPLE ARE NOW

RAISING?

>> WELL, I THINK IT WOULD BE

VERY DIFFICULT TO KIND OF HAVE

THE COMPANY TOWN MENTALITY THAT

THEY HAD PERHAPS IN CHINA.

THAT, I THINK, WAS WHAT DROVE A

LOT OF THESE PEOPLE, THESE WERE

MOSTLY MIGRANTS COMING FROM

SMALL RURAL VILLAGES IN CHINA,

PERHAPS A LOT OF SHOCK INVOLVED

THERE, A LOT OF OVERTIME, VERY

CLOSED SYSTEM.

VERY, VERY DIFFICULT.

BUT TERRY IS A VERY, VERY SAVVY

BUSINESSMAN.

A GUY WHO IS GOING TO WALK

CAREFULLY WHERE THE SIGNS ARE.

I THINK THE FACT HE HAS CHOSEN

PAUL RYAN'S DISTRICT IS AN

INDICATION THAT HE IS A VERY

SAVVY BUSINESSMAN WHO

UNDERSTANDS HOW POLITICS WORKS.

IT HAS HELPED HIM IN CHINA AND

ALL OF THE OTHER COUNTRIES THAT

HE'S BEEN INVOLVED IN.

HE DOES IT VERY WELL, I DON'T

THINK HE'LL BE LOOKING TO

ANTAGONIZE PEOPLE IN THE UNITED

STATES.

YOU MUST PAY OVERTIME AND OBEY

THE RULES.

>> CLEARLY PRESIDENT TRUMP HAS

DECLARED HE WANTS THINGS MADE IN

AMERICA.

IS FOXCONN CONCERN THE ENOUGH

ABOUT TARIFFS CUTTING INTO

PROFITS THAT IT'S GETTING AHEAD

OF THAT, AND WORKING TO PLEASE

THE PRESIDENT BY GOING INTO A

BATTLEGROUND STATE LIKE

WISCONSIN?

DO THE POLITICS EXTEND THAT

DEEPLY INTO THIS?

>> I WOULD SAY ABSOLUTELY, TERRY

IS VERY, AS I SAID BEFORE, VERY,

VERY SAVVY.

HE'S NOT GOING TO MISS A TRICK.

HIS BUSINESS IS SO LARGE AND SO

WORLDWIDE HE CANNOT AFFORD TO

LOSE MARKETS.

YOU LOSE MARKETS, YOU EARN

COMPETITION.

RIGHT NOW HE BASICALLY OWNS MOST

OF THE MARKET.

HE WANTS TO KEEP IT THAT WAY.

THIS IS A SAFETY PLAY, AND IT

MAKES LOTS OF SENSE.

PRESIDENT TRUMP IS, AS MOST

PEOPLE HAVE REALIZED, VERY OPEN

TO FLATTERY.

HE LIKES IT WHEN PEOPLE THROW

AROUND BIG NUMBERS, ESPECIALLY

IF THEY ARE PROMISING JOBS OR

MADE IN AMERICA.

WE'LL HAVE TO SEE HOW IT ALL

WORKS OUT IN THE END.

MY GUESS IS THAT THIS PLANT WILL

NOT BE THE KIND OF ASSEMBLY

PLANT THEY HAVE IN CHINA, WHERE

THEY HAVE TENS OF THOUSANDS OF

WORKERS TOILING AWAY, PUTTINGS

PIECES TO GO.

IT'S AN L.C.D. FACTORY, MY GUESS

IS A LOT WILL BE AUTOMATION AND

AS FEW EMPLOYEES AS POSSIBLE.

SO YES, POLITICS IS DEFINITELY

BEHIND THIS, AND AS I SAID

BEFORE, I DON'T THINK IT'S A

MISTAKE THAT THIS IS TOUTED IN

PAUL RYAN'S NEIGHBORHOOD.

>> SOME POINT OF CONCERNS THAT

FOXCONN MADE SIMILAR

ANNOUNCEMENTS IN PENNSYLVANIA

PREVIOUSLY AND THE PLANT NEVER

CAME TO BE.

COULD THAT HAPPEN AFTER THE

ANNOUNCEMENT ABOUT WISCONSIN?

>> WELL, IT'S OBVIOUSLY A

CONCERN.

THIS IS A LITTLE SPLASHIER THAN

MOST, AND ALSO HAVE THE

PRESIDENT DIRECTLY INVOLVED.

I DON'T KNOW THAT YOU WOULD WANT

TO PLAY THAT KIND OF BLUFF GAME

WITH DONALD TRUMP UNLESS HE

THINKS DONALD TRUMP IS NOT GOING

TO BE AROUND IN ANOTHER, YOU

KNOW, YEAR OR SO.

I THINK IT MAKES MORE SENSE THAT

HE IS INTERESTED IN GETTING THE

TRUMP ORGANIZATION ON HIS SIDE,

BUILDING AN AMERICA AS I SAID,

AS AN INSURANCE POLICY AGAINST A

TRADE WAR WHICH IS STILL QUITE

POSSIBLE.

>> YOU SPOKE EARLIER ABOUT

AUTOMATION IN THE PLANT, HAVING

AS FEW EMPLOYEES AS POSSIBLE.

BUT WISCONSIN IS TALKING ABOUT

3,000 JOBS TO START, POTENTIALLY

RAMPING UP TO 13,000, PLUS

SPINOFF EMPLOYMENT.

DO YOU THINK THOSE KINDS OF

NUMBERS ADD UP, GIVEN YOUR SENSE

ABOUT AUTOMATION?

>> I WOULD FIND IT HARD TO

BELIEVE THAT HE WOULD HAVE THOSE

KIND OF NUMBERS THERE.

I COULD SEE A HIGHLY AUTOMATED

FACTORY BEING STAFFED AT AS LOW

LEVELS AS POSSIBLE.

REMEMBER, HE'S NOT ACTUALLY

PRODUCING A LOT OF HIS

COMPONENTS THAT ARE GOING INTO

THE L.C.D. FRAMES.

THOSE ARE GOING TO BE DONE

ELSEWHERE.

THE BOARDS, GLASS, THINGS LIKE

THAT, BUT IT'S NOT ALL GOING TO

BE DONE ON PREMISES.

THEREFORE, A TREMENDOUS AMOUNT

OF SUPPLIERS, PEOPLE IN

SHIPPING, THINGS LIKE THIS.

SO, AS I SAID, THE UP SIDE

OPPORTUNITY IF THEY GO FORWARD

WITH THIS IS NOT NECESSARILY

LOOKING WHAT YOU ARE GOING TO

GET OUT OF FOXCONN, WHICH IS

VERY, VERY LITTLE, BUT LOOKING

WHAT KIND OF INFRASTRUCTURE YOU

CAN BUILD FOR FUTURE INNOVATION

AND CREATING KIND OF A NEW TECH

CORRIDOR THAT COULD BE VERY

HELPFUL, AS I SAID, TO WISCONSIN

AND ILLINOIS.

>> AS TO INFRASTRUCTURE, DO

WISCONSIN'S HIGHWAYS AND RAIL

LINES SUPPORT THIS OPERATION?

>> WELL, INTERESTING ENOUGH,

THIS COULD BE A CATALYST TO A

LOT OF THE INFRASTRUCTURE NEEDED

BECAUSE ONE OF THE THINGS

FOXCONN IS GOING TO INSIST ON IS

THAT THEY HAVE AMATEUR

INFRASTRUCTURE TO HANDLE

WHATEVER THEY HAVE, AND THAT IS

PROBABLY GOING TO BE ROADS,

EVERYTHING COMES OUT OF

WISCONSIN, DESPITE THE GREAT

LAKES THERE, MOST IS GOING BY

ROAD AND SOME BY RAIL.

SO, DON'T BE SURPRISED IF PART

OF THE PACKAGE IS A SERIES, SOME

MONIES BEING PUT TOWARDS THE

INFRASTRUCTURE IN SOUTHEASTERN

WISCONSIN.

AS I SAID, THOUGH, THIS IS VERY

DIFFICULT FOR A LOT OF THE AREAS

IN NORTHERN WISCONSIN WHO KIND

OF SEE THIS, ALL THIS EXCITEMENT

AND SAY WHERE'S MINE.

OUR ROADS ARE NOT BEING TAKEN

CARE OF, AND THINGS LIKE THAT.

SO I THINK SCOTT WALKER WILL

HAVE TO DO A LITTLE WAY TO SHOW

HOW IT'S GOING TO BENEFIT THE

ENTIRE STATE, NOT JUST A SMALL

CORRIDOR BETWEEN MILWAUKEE AND

CHICAGO.

>> THAT WAS EINAR TANGEN IN

BEIJING.

AS WE HAVE SAID, THE PROMISE OF

THOUSANDS OF FOXCONN JOBS COMES

WITH THE PRICE TAG OF $3 BILLION

IN STATE TAX CREDITS, LARGEST

INCENTIVE IN STATE HIS STORY.

MEMORANDUM OF UNDERSTANDING

BETWEEN THE STATE AND THE

COMPANY CONTAINS FEW DETAILS,

BUT THOSE ARE EXPECTED IN A FULL

BILL TO BE BROUGHT IN THAT

SPECIAL SESSION OF THE

LEGISLATURE.

WE TURN NOW TO A U.W. ECONOMIST

WHOSE EXPERTISE INCLUDES PUBLIC

FINANCING OF PRIVATE INDUSTRY

PROJECTS.

STEVE DELLER IS A PROFESSOR OF

AGRICULTURE AND APPLIED

ECONOMICS AT U.W. MADISON.

THANKS A LOT FOR BEING HERE.

>> THANK YOU.

>> SO, THE FOXCONN PACKAGE

DWARFS PREVIOUS INCENTIVES TO

ATTRACT OR RETAIN JOBS.

WHAT'S YOUR REACTION TO IT?

>> WISCONSIN HISTORICALLY HAS

NOT PLAYED THIS GAME.

THEY WILL PUT TOGETHER A

REASONABLE PACKAGE AND SAY TAKE

IT OR LEAVE IT.

BUT THIS PARTICULAR ONE IS KIND

OF PASSES THAT RED LINE THAT WE

HAVE HAD HISTORICALLY.

BUT, THIS IS NOT JUST A CASH

GIVE AWAY.

THIS IS THE COMPANY HAS TO HAVE

A SERIES OF BENCHMARKS, AND IF

THE COMPANY DOESN'T HIT THESE

BENCHMARKS, THE INCENTIVES DON'T

APPLY AND THEY CAN CLAW THEM

BACK, ESSENTIALLY SAYING YOU

DIDN'T DO WHAT YOU PROMISED,

GIVE US SOME OF THE MONEY BACK.

>> SO YOU FEEL AS THOUGH THAT'S

ENOUGH OF A PROTECTION WITH THIS

SIZE OF AN INCENTIVE PACKAGE?

>> THOSE KIND OF PROTECTIONS

HAVE TO BE IN PLACE.

OTHERWISE IT IS JUST A PURE GIVE

AWAY, AND THAT WOULD BE A BAD

DEAL FOR THE STATE OF WISCONSIN.

DEVIL IS IN THE DETAILS AND

DETAILS ARE STARTING TO COME

OUT.

IT APPEARS AS THOUGH MOST OF THE

INCENTIVES ARE ACTUALLY TAX

BREAKS, SO THIS DOESN'T LOOK AS

THOUGH IT'S GOING TO BE MONEY

OUT OF THE POCKET OF TAXPAYERS,

BUT RATHER TAXES THAT THE

COMPANY AND PARTICULARLY THE

CONSTRUCTION PHASE, THEY DON'T

HAVE TO PAY THOSE TAXES.

>> WISCONSIN ALREADY HAS THE

MANUFACTURING AND AG CREDITS,

WHICH I UNDERSTAND REDUCES

FOXCONN'S CORPORATE INCOME TAX

RATE TO .4%, BUT ADDITIONALLY

GET WHAT I UNDERSTAND TO BE

REFUNDABLE TAX CREDITS, WHICH TO

MY EAR SOUNDS LIKE KIND OF CASH

IN HAND.

>> IT IS TO EXTENT IN THAT IT'S

TAKING AWAY FROM THEIR TAX BILL.

IN THE END, THE COMPANY WILL

PROBABLY BE PAYING VERY LOW IN

TERMS OF TAXES, INCOME TAXES.

SO, IT IS NOT MONEY THAT WE ARE

GIVING BACK, OR GIVING TO THE

COMPANY, IT'S MONEY THAT WE

WOULD NOT BE RECEIVING IF THE

INCENTIVES WERE NOT IN PLACE.

>> IN THE FIRST RESPONSE YOU

SAID WE KIND OF CROSSED THE RED

LINE AND YOU DESCRIBED HOW

PREVIOUSLY THERE WERE

"REASONABLE KIND OF INCENTIVE

PACKAGES."

SO, WHAT DO YOU MEAN BY CROSSING

THE RED LINE AND DO YOU THINK

THIS IS UNREASONABLE?

>> IT'S THE GAME THAT STATES

START TO PLAY, IT'S BEEN

REFERRED TO AS THE NEW CIVIL

WAR.

STATES WILL START BIDDING

AGAINST EACH OTHER TO ATTRACT A

COMPANY LIKE THIS.

AND SOME STATES GET WRAPPED UP

IN THAT GAME.

THEY GET SO FOCUSSED ON WINNING

THE GAME THAT THEY SOMETIMES

LOSE TRACK THAT THEY ARE PLAYING

WITH TAXPAYERS' MONEY.

THE STATE HISTORICALLY HAS NOT

PLAYED THAT GAME.

THEY WILL DO THINGS LIKE WE WILL

INVEST IN INFRASTRUCTURE IF YOU

NEED IT, INVEST IN EDUCATIONAL

PROGRAMS IF YOU NEED IT, WE WILL

GIVE YOU A DEFERMENT ON SOME

TAXES BUT WE ARE NOT GOING TO

GET ON THAT SLIPPERY SLOPE OF

PLAYING THAT BIDDING GAME.

>> WHAT'S WRONG WITH IT IF YOU

WIN?

>> YOU ACTUALLY CAN END UP WITH

THE ECONOMIC BENEFITS NOT

OUTWEIGHING THE COST OF THE

INCENTIVES.

>> WHAT DO YOU THINK IN THIS

CASE?

>> I THINK, THE ONE THING THAT I

WAS REALLY WORRIED ABOUT IS THAT

PROPERTY TAXES WERE ON THE

TABLE.

AND IT APPEARS AS THOUGH THEY

ARE NOT.

THE REASONS BECAUSE A LOT OF

STATES, WHEN THEY GET IN THE

BIDDING GAMES, ONE OF THE BIG

ONES IS, YOU DON'T HAVE TO PAY

PROPERTY TAXES.

THE PROBLEM IS THAT'S THE LOCAL

GOVERNMENT THAT GETS HIT WITH

THAT, AND THEY GET CAUGHT

BETWEEN A ROCK AND A HARD PLACE.

>> I UNDERSTOOD, THOUGH, SOME OF

THE LOCAL DISTRICTS LIKE

WHEREVER THE THOUSAND ACRES

MIGHT BE THAT THE PLANT DECIDES

TO LOCATE ON, THEY MAY END UP

LOSING ON TAXES EVEN AS THEY

MAKE SERVICE DISTRICTS.

>> IT'S A TIF DISTRICT.

WHAT THE PROPERTY TAXES GO TO IS

DEDICATED.

FOR EXAMPLE, IF THE MUNICIPALITY

FINDS THAT THEY HAVE TO DO MAJOR

ROAD IMPROVEMENTS, OR DO A MAJOR

EXPANSION OF A SEWER PLANT OR A

NEW FIRE STATION, THEY HAVE

INCURRED THOSE COSTS UP FRONT

AND THE WAY THEY DO IT, OFTEN GO

TO THE BONDING MARKET.

THEY INCUR DEBT TO DO IT.

THE WAY THEY CONVINCE THE BANKS,

IF YOU WILL, TO LOAN THEM THE

MONIES, THEY SAY WE HAVE THIS

REVENUE STREAM COMING OFF OF

THIS PROPERTY THAT IS GOING TO

BE EARMARKED FOR PAYING FOR

THOSE IMPROVEMENTS.

THE PROBLEM, THOUGH, IS THE

SCHOOL DISTRICT LOSES OUT.

SPECIAL DISTRICTS, IF THERE ARE

SPECIAL DISTRICTS IN THERE, THEY

LOSE OUT.

ONLY GOES TO THE MUNICIPALITY

THAT IMPOSES THE TIF.

>> WHAT ABOUT THE IDEA OF

POTENTIALLY PUTTING MORE MONEY

IN FOR THINGS LIKE WORKER

TRAINING AT A CERTAIN POINT, YOU

KNOW, BECAUSE THIS IS -- IF

THESE KINDS OF JOB NUMBERS PAN

OUT, IT'S A LOT OF PEOPLE THAT

HAVE TO BE KIND OF TRAINED UP.

CAN YOU IMAGINE A SCENARIO WHERE

THE STATE WOULD THEN GO BACK AND

KIND OF GIVE MORE MONEY?

>> THAT'S THE KIND OF INVESTMENT

THAT THE STATE SHOULD BE MAKING

EITHER WAY.

WHETHER IT'S SPECIFIC TO FOXCONN

OR SPECIFIC TO THE LABOR FORCE

NEEDS TO THE STATE IN GENERAL,

THE STATE SHOULD BE MAKING THOSE

INVESTMENTS.

NOW, MY ONE CONCERN, THOUGH, IS

THAT THE CLOSER THAT THIS PLANT

IS LOCATED TO THE ILLINOIS STATE

LINE, A LOT OF THOSE PEOPLE

TAKING THOSE JOBS ARE GOING TO

BE COMMUTERS COMING UP FROM THE

CHICAGOLAND AREA.

PEOPLE ARE WILLING TO COMMUTE

GREAT DISTANCES FOR GOOD-PAYING

JOBS.

SO, IT DEPENDS ON HOW MANY OF

THOSE JOBS ARE ACTUALLY GOING TO

PEOPLE WHO LIVE IN ILLINOIS.

>> IN FACT, EINAR TANGEN, WHO WE

SPOKE WITH JUST BEFORE YOU,

DESCRIBED THIS IDEA OF HAVING TO

PROBABLY GET SOME OF THESE

EMPLOYEES OUT OF ILLINOIS TO

FILL THE GAP IF THESE KINDS OF

JOB NUMBERS PAN OUT.

IS THAT A REASON WHY SOME

PEOPLE, EXPERTS IN ECONOMIC

DEVELOPMENT, TALK ABOUT REGIONAL

DEVELOPMENT AS OPPOSED TO THIS

KIND OF STATES TRYING TO WIN AT

ALL COSTS AGAINST EACH OTHER.

>> EXACTLY.

IDEALLY, ILLINOIS AND, BECAUSE

GIVEN THE LOCATION OF THIS

PROPOSED PLANT, IT WOULD HAVE

BEEN IDEAL IF ILLINOIS AND

WISCONSIN HAD KIND OF COME

TOGETHER AND SAID HEY, WE ARE

GOING TO TAG TEAM THIS AND TRY

TO GET IT.

BUT THERE IS AN EDITORIAL IN THE

"CHICAGO TRIBUNE" A FEW DAYS AGO

SAID IT COULD BE A WIN-WIN FOR

ILLINOIS, THEY HAVE THE JOBS BUT

NOT INCURRING THE COST AT ALL.

>> IS IT TOO LATE TO DO

ANYTHING?

>> I'M NOT SURE ILLINOIS IS IN A

POSITION TO DO ANYTHING.

THEY ARE IN A WORLD OF HURT.

>> BACK TO THE CREDITS, THEY ARE

PROJECTED TO COST BETWEEN 200

AND $250,000 A YEAR.

COULD THE STATE WEATHER THAT?

>> IT'S THE CONSTRUCTION COMPANY

NOT PAYING THE SALES TAXES, BUT

YOU STILL HAVE ALL THE PEOPLE

THAT ARE GOING TO BE WORKING

THERE ARE STILL GOING TO BE

PAYING SALES TAXES AND INCOME

TAXES, THAT'S WHERE THE BENEFIT

WILL FLOW INTO THE STATE

IMMEDIATELY.

>> VERY BRIEFLY IN THE FEW

SECONDS REMAINING, YOUR OVERALL

VIEW OF THIS TENDS POSITIVE?

>> IT DOES.

WHEN IT FIRST CAME OUT I THOUGHT

OH, NO, WE MADE A TERRIBLE

MISTAKE.

BUT AS DETAILS ARE COMING OUT

AND THE -- THAT THERE ARE

BENCHMARKS IN THERE, ANY JOB

PAID LESS THAN 30,000 DOESN'T

COUNT, THERE'S CLAWBACK

PROVISION, THE LOCAL GOVERNMENT

IS ALLOWED TO USE A TIF, I THINK

AS MORE DETAILS COME OUT, I

THINK THEY THOUGHT THIS THING

THROUGH.

>> GREAT.

PROFESSOR STEVE DELLER, THANKS

VERY MUCH.

>> THANK YOU.

>> ACCORDING TO THE GOVERNOR'S

OFFICE, FOXCONN IS EVALUATING

MULTIPLE SITES IN SOUTHEAST

WISCONSIN TO BUILD THE PLANT.

COULD MAKE MILLIONAIRES OUT OF

EVEN SMALL LAND OWNERS.

IN RACINE COUNTY, A REAL ESTATE

COMPANY HAS BEEN BUSY TO PUT

OPTIONS TO SELL IN PLACE ON

PARCELS OF LAND THOUGHT TO BE

UNDER CONSIDERATION FOR THE

$10 BILLION FACILITY.

A REQUIREMENT FOR AN OPERATION

OF THAT SIZE, AT LEAST 1,000

ACRES.

THAT'S WHERE OUR QUADRANT OF

LAND JUST OFF THE INTERSTATE

NEAR RACINE COMES IN.

>> THEY DID APPROACH TO ASK IF I

WAS INTERESTED IN SELLING.

>> FARMER TOM FLIESS SAYS HIS

SON FARMS THE LAND INSIDE THE

AREA REPORTEDLY UNDER

CONSIDERATION BY FOXCONN.

BUT HE OWNS IT.

WHETHER HE'S INCLINED TO SELL,

HE'LL ONLY SAY.

>> TIME WILL TELL, I DON'T KNOW.

>> MANY INSIDE THE AREA, THOUGHT

TO HAVE BEEN OFFERED OPTIONS TO

SELL, ARE KEEPING QUIET ABOUT

IT.

IT'S AN AREA OF MORE THAN 1,000

ACRES, ROUGHLY BOUND BY

INTERSTATE 94, HIGHWAY 11,

HIGHWAY K, AND BROWN ROAD ON THE

SOUTH.

SOME LAND OWNERS JUST OUTSIDE

THE QUADRANT HAVE ALSO BEEN

ENGAGED.

>> A COUPLE WEEKS AGO I FOUND

OUT ABOUT IT FROM ONE OF THE

FARMER, THEY CONTACTED HIM ABOUT

SELLING HIS LAND, HIS LAND

SURROUNDS MINE.

>> IF THE OPTIONS TO SELL ARE AN

INDICATION, THE BUYER THOUGHT TO

BE FOXCONN IS WILLING TO PAY WAY

OVER MARKET VALUE FOR THE

ACREAGE.

THIS IS UNDER OPTION AT $50,000

AN ACRE.

HE WAS ASKING 12,000.

IF THE OPTION TURNS INTO A SALE,

IT MAKES IT A MILLION DOLLAR

PLOT.

SHERRI SHAVER LIVES ACROSS THE

ROAD FROM THE 1,000 ACRES BEING

EYED.

>> LOOKING THAT WAY, THAT WOULD

POSSIBLY BE IT, HUH?

>> THAT'S IT RIGHT THERE FOR

SURE, AND IT'S A MATTER OF HOW

MUCH THEY ARE GOING TO TAKE ON

THIS SIDE.

>> AFTER TENDING HER SMALL

COUNTRY HOMESTEAD FOR 23 YEARS,

SHAVER IS SAD ABOUT EITHER

PROSPECT, STAYING OR LEAVING.

>> WELL, IT'S BEEN A SHOCK, YOU

KNOW, TO THINK WE ARE GOING TO

HAVE A BIG OLD FACTORY HERE AND

I MIGHT BE LOOKING AT A FACTORY

ACROSS FROM ME.

BUT THEN YOU KNOW, THEY MIGHT

BUY ME OUT, SO THEN I'LL HAVE TO

MOVE.

>> AS TO THE SUITABILITY OF THE

LAND, IT'S JUST OFF THE

INTERSTATE, AND MOSTLY WIDE OPEN

FARMLAND.

A RAIL LINE JUST EAST.

ONE DAY THIS WEEK, DEPARTMENT OF

TRANSPORTATION TRAFFIC COUNTERS

WERE ON-SITE AT TWO OF THE

CROSSROADS OF THE LOCATION.

THE LOCAL ATTORNEY REPRESENTING

LAND OWNERS SAYS HE CANNOT

DIVULGE INFORMATION, AND SAYS HE

HAS VERY LITTLE OF IT ANYWAY.

DESPITE NOT KNOWING DETAILS,

PEOPLE WE TALKED WITH ARE MOSTLY

SANGUINE, EVEN AS THE MOSTLY

RURAL LANDSCAPE CONTEMPLATES A

MEGA ELECTRONICS PLANT.

>> WHAT DO YOU THINK ABOUT THE

POTENTIAL OF 10,000 JOBS IN THIS

AREA?

>> THAT'S GREAT FOR PEOPLE.

I DON'T NEED 'EM FOR NEIGHBORS,

BUT THAT'S FINE, I'M A FARMER,

YOU KNOW.

>> WE ARE TOLD THERE IS AT LEAST

ONE MAJOR LANDOWNER IN THAT AREA

WHO IS NOT INTERESTED IN

SELLING.

BUT ACCORDING TO ASSEMBLY

SPEAKER ROBIN VOSS, WHOSE

DISTRICT IT SITS, MUNICIPALITIES

COULD EXERCISE EMINENT DOMAIN TO

BUY THEM OUT.

NOW OTHER NEWS, FOXCONN IS KNOWN

FOR MAKING PRODUCTS FOR MANY

ELECTRONICS FIRMS, INCLUDING

APPLE.

AND THIS WEEK APPLE WAS ALSO IN

THE WISCONSIN HEADLINES.

THAT'S BECAUSE A FEDERAL JUDGE

ORDERED APPLE, INC. TO PAY MORE

THAN A HALF BILLION DOLLARS TO

THE UNIVERSITY OF WISCONSIN

ALUMNI RESEARCH FOR PATENT

INFRINGEMENT.

THEY WERE FOUND GUILTY OF USING

PATENTED TECHNOLOGY IN iPADS AND

iPHONES, AND ORDERED TO PAY

$200 MILLION.

AFTER THE VERDICT, THEY

CONTINUED WHICH REMAINED UNDER

PATENT UNTIL LAST DECEMBER.

APPLE HAD TO WAY WHARF

$270 MILLION.

I'M FREDERICA FREYBERG.

HAVE A GREAT WEEKEND.

>> FUNDING FOR "HERE AND NOW" IS

PROVIDED IN PART BY FRIENDS OF

WISCONSIN PUBLIC TELEVISION.

The Description of WPT Here and Now: Exploring Foxconn's Wisconsin Plans