Cronyism isn't growth

Illinois politicians love giving big corporations money.

Gov. Pat Quinn recently made a 10-year deal worth $12 million with eBay, which has pledged to create 360 jobs in downtown Chicago.

Some people will hold up this deal as a sign that the state is getting serious about creating jobs and boosting the economy.

But it’s actually a sign that Illinois’ business climate is so bad that it has to pay companies to take root here. And while these big companies get special tax deals to open up shop, the state is punishing entrepreneurs who are just getting off the ground

Quinn’s eBay deal cost more than $33,000 per job created.

The deal allows eBay to claim a state tax credit on its corporate income taxes under the Economic Development for a Growing Economy, or EDGE, program, according to the Chicago Tribune.  Other companies taking part in EDGE program deals include Motorola Mobility, Ford and Navistar.

Deals like this ignore what makes Chicago great.

Tourists visiting Chicago may flock to Navy Pier, Michigan Avenue’s big-name retailers and the Sky Deck, but the city’s real charm lies in its unique neighborhoods – and the shops and restaurants that operate in them.

Small businesses – ranging from mom and pop restaurants such as Twin Anchors to the craft brewers at Revolution Brewing to the luxury consignment mavens at eDrop-off – set up shop here and give residents and visitors a memorable, unique experience. They are homegrown job creators that give taxpayers more than they take.

But in the city where a $33,000 per job corporate subsidy is passed off as innovative growth, these businesses thrive against the odds.

Instead of being showered with millions of taxpayer dollars, Illinois rewards these businesses with the ninth-highest state and local tax burden in the country.

Combined with long wait times for permits, high start-up fees and licensing requirements that hurt low-income entrepreneurs, it’s hard for the businesses that make Chicago unique to get off the ground.

The truth about tax-break deals like the one Quinn just gave eBay is that any job created or dollar earned comes at the expense of all of the small businesses that don’t get multimillion-dollar tax breaks from the state.

If Chicago and Illinois officials really cared about job creation, they would sweeten the pot for all businesses by lowering  tax burdens and barriers to entry. Then maybe instead of Illinois having to pay-to-play with big business, job creators would want to put Illinoisans on their payrolls – no handouts necessary.

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