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The list of enticements states use to attract businesses is long. Some of Mr. Hood’s examples: Mercedes won’t have to pay Alabama state income taxes for 25 years; South Carolina’s 1992 deal with BMW included buying 900 acres of land and leasing it to the company for $1 per year; and Tennessee upgraded highways to improve access to proposed Saturn and Nissan plants.
During the Mercecdes battle, North Carolina even went so far as to push a bill through its legislature to build a $35 million auto-manaufacturing training facility, only to lose to Alabama in the bidding war. The problem: When Mercedes suggested North Carolina also pay the salaries of its 1,500 workers for their first year, at a cost of $45 million, the Tar Heels declined. Alabama agreed to a similar request.
So why don’t states change their ways? Mr. Hood says one of the primary reasons is good, old-fashioned
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