Articles in the Albany Times Union and the NY Times trumpet a new initiative in "job creation" involving heavy state investment in the U Albany NanoTech complex.
According to the Albany Times Union article: Nanotech initiative called boost for state:
The unveiling of the International Venture for Nanolithography, or Invent, promises to bring another 200 people to Albany NanoTech. . . The seven-year, $600 million project includes about $180 million from the state, including $105 million already earmarked by the Assembly. IBM is expected to provide $80 million, while the three other chipmakers will contribute $40 million each. The rest, $220 million, will come from other companies involved in the effort.
According to the New York Times article: A New Microchip Project Is Begun at Albany Center:
The growth of the technology sector here got a big boost in 2002, when Governor Pataki helped lure Sematech . . .
Since the Sematech deal, the state has given $535 million to start projects at Albany NanoTech . . .There are currently 645 people working at NanoTech, officials said, which is shy of the 1,000 it was hoped would be working there by now.
These dollar numbers are large making it somewhat difficult to grasp their significance. Doing a little math puts things in perspective.
The state has already spent $535 million over the last 3 years to provide employment to 645 people (shy of the goal of 1000). That works out to $276,000 per person per year.
The new deal being announced this week will throw in another $180 million of state money over 7 years to bring in 200 more people. That works out to almost $129,000/person per year.
By 2012, the state would have contributed $715,000,000 over 10 years to this project to, hopefully, employ 845 workers: that's almost $85,000 per worker per year (assuming that 845 people would have actually worked for the 10 years which will not be the case)!
While the newspapers talk of the "state" making these contributions, it is really the state's taxpayers who are paying the bill. Since the taxpayers are subsidizing the Research and Development budgets which are the responsibility of the likes of IBM, such companies are being allowed to pocket the amounts as profits.
This is not economic development. It's creating taxpayer-supported jobs to funnel money into private investors' pockets.
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