When one company is subsidized over another, it doesn’t contribute to economic growth, it merely moves resources in the economy away from efficient investments towards inefficient ones, and discourages firms from producing for the market, encouraging them to produce for the government instead.
As currently constructed, the Stellantis deal assumes a 10-year term, and is dependent on the production and sale of electric batteries, but what happens if the plant takes longer to build, or it takes longer to get production to expected levels? Or the demand for electric vehicles just isn’t there? Or, what happens when Washington increases funding again?
When it comes to government support for manufacturing, changes to deals that favour the recipients of subsidies at the expense of taxpayers are common. The plant was supposed to contribute to “economic revitalization,” but “the only new nearby business is a Tim Horton’s coffee shop.” To add even more injury to the insult: “
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