Foxconn and Cycling

You might not think that the massive Foxconn deal has much of anything to do with bicycling, but there is a link. Read on.

If you’ve been living under a rock or fanatically training for the Ride Across Wisconsin you could be forgiven for not knowing about Foxconn. The company is a giant Chinese manufacturer of flat screens and it promises to locate a big plant in Southeast Wisconsin in exchange for $3 billion in payments from state taxpayers and exemption from a number of environmental regulations.

Most of that $3 billion is actual direct cash payments to the company from Wisconsin taxpayers. It would cost a family of four, on average, about $140 a year for the next 15 years.

So, here’s the connection: for roughly the same cost to taxpayers we could lay a good foundation for fixing our roads. And we’d create a lot more jobs.

Instead of sending $3 billion to Foxconn we could fix these all over the state — and create a lot more jobs.

Four years ago a special task force recommended a program of investing in transportation that would cost the average driver about $120 a year. For that investment we’d not only get those potholes filled, but we could rebuild streets right so that potholes didn’t happen. We could pave shoulders on rural roads. We could provide more separated bike lanes that benefit both cyclists and drivers.

And here’s a bonus. At its rosiest projection and counting all the direct jobs, construction jobs and jobs induced by the project, Foxconn would produce about 50,000 jobs. But for that same $3 billion investment in roads and other transportation needs, we could produce about 84,000 direct and indirect jobs.

Better yet, those jobs would be produced all over the state, wherever a road needed fixing. The Foxconn jobs will be isolated to Southeast Wisconsin and Northeast Illinois.

To add insult to injury Illinois residents will reap the benefits while not having to shoulder the costs of the big Foxconn taxpayer subsidy. You could say the same thing about road building, except that road improvements will make it easier for Flatlanders to come here and spend their money. The Foxconn deal will make it easier for them to take jobs we subsidize to the tune of $230,000 to $1 million per job.

And here is the final irony. The state budget is going on two months overdue primarily because Gov. Scott Walker refuses to back new transportation taxes that would cost the average driver maybe $120 a year. But now he’s pushing hard for a project that will cost taxpayers roughly the same amount of money, only with benefits far below what a sound transportation budget would deliver.

About Dave Cieslewicz, Director Emeritus

Dave Cieslewicz served two terms as mayor of Madison where he set the city on a path for Platinum status as one of the best biking cities in North America. Before that he started his own nonprofit, 1000 Friends of Wisconsin, which focuses on land use and transportation policy. He has been an adjunct professor at the UW Madison's Department of Urban and Regional Planning where he teaches a class called Bikes, Pedestrians and Cities. He pronounces his name chess LEV ich, but nobody else does.

9 thoughts on “Foxconn and Cycling

  1. The FoxConn deal is bad overall. The company has a tragically poor record of producing what they promise … in Ohio recently and in at least 10 other failed projects around the globe. They take the money and then fail to build in many cases, significantly under-perform in others.

    It’s break even analysis is something like 2040 IF they deliver what they say they will (doubful) and IF all of the labor is from WI (which it wouldn’t be). Further, even if they did do *something* the natural evolution in automation technology will soon eliminate most of the labor no differently than other manufacturing trends.

    Beyond that, if we’re going to line the pocket of a foreign corporation, where’s the assistance for the rest of Wisconsin businesses … why not give the small businesses the cash? It’s well documented that most innovation, and most growth, and most employment is through small business.

    Thanks for sharing Dave, Ride On Wisconsin!


  2. Also, Foxconn is Taiwanese, not Chinese, a necessary distinction as they aren’t bound to, benefit from, nor limited by the Chinese government. At least with a Chinese company you have the equivalent of government bonds to back the deal (almost every operating Chinese business in China is a partnership with the government … their form of corporate taxation).

    High risk. We can do better.

  3. > The state budget is going on two months overdue primarily because Gov. Scott Walker refuses to back new transportation taxes that would cost the average driver maybe $120 a year.

    You have to remember that the correlation here would not result in better roads. I also cannot understand how a road would be pothole never happen. Can you explain how that is possible?

    Without risk there is no reward. I agree that roads need to be addressed but having an economic boom like Foxconn could be a good thing for the SE part of the state.

    • Yes I can explain how better roads prevent potholes. Potholes happen because cracks develop as roads age. The cracks fill with water and in winter that water freezes and thaws, freezes and thaws. The freeze expansion stresses the crack and eventually potholes blow out. When you resurface or rebuild the road it reduces potholes dramatically.

        • The state sends some of your gas tax dollars back to your local government to do road maintenance, repair and rebuilding. So, of the $120 a year the average driver would spend in increased gas taxes a portion of that would go to improve local roads.

          • Got it! I follow your logic now. I disagree though due to the precedence set by local municipalities misusing or spending the funds elsewhere. For those residents that live in communities such as that the $120 extra per year would not benefit the road conditions.

            I agree that roads should be improved. Gas taxes sounds like a just way of coming about it, but have to disagree when it comes to implementation. Wisconsin has high gas taxes already. My fear is that we would raise taxes but not improve roads or biking conditions.

            I support the Foxconn deal with some reservations but wish the budget would get done first. It feels like the representatives are playing political games and not prioritizing the state’s budget.

  4. I think the idea of improving roads for cycling is a great idea. I just got back into cycling again this summer myself. However, I think the logic here is tragically flawed. The job creation from putting that money towards roads is purely speculated. While job creation from Foxconn is is pretty much known. Secondly, once that 3 billion is gone so are most of the jobs. This would once again place hard working Wisconsinites in the unemployment line. As for losing those jobs to automation later on as commented on…that is irrelevant. This is a pattern seen everywhere. It isn’t limited to Foxconn. Its just the direction we are moving as a whole. I would suggest formal training in the automation field at some point. Those jobs will be plentiful. I could also speculate that automated road pavers aren’t that far off as well.

    • Actually it’s just the opposite. The transportation jobs are certain as that industry is as automated at it’s going to be. There are no assurances at all for the Foxconn jobs and it’s an industry that is automating rapidly.

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