Professor Peter Enrich Addresses the Council on Foreign Relations
06.12.14 — Nationally recognized for his opposition to states and localities luring businesses through tax breaks, Professor Peter Enrich today addresses the Council on Foreign Relations (CFR) at a by-invitation roundtable, "How to Curtail the State Subsidies War." State and local governments spend more than $80 billion a year--or roughly 7 percent of their budgets--on subsidies to retain or lure businesses. Today's private gathering of key Washington policymakers is sponsored by CFR’s Renewing America initiative, which sponsors meetings, research, analysis, recommendations, and outreach on how best to revitalize the country's economic strength and build the foundations for future prosperity and influence.
"For two decades, I, along with a growing network of other academics and policy analysts, have been arguing that these tax breaks and subsidies are wasteful, ineffective, and in conflict with basic principles of federalism," said Enrich, who argued before the US Supreme Court in a 2006 case challenging the constitutionality of state tax giveaways used to compete for businesses.
In addition to Enrich, Mark Muro, a Senior Fellow at Brookings, and the leader one of the country's top research programs for metropolitan policy and local economic policy, will speak.
"Business location decisions are at best marginally influenced by these expensive give-aways, and the incentive competition among states and cities has become an unproductive 'race to the bottom,' which has seriously undermined the ability of state and local governments to impose reasonable levels of taxes on large, mobile (and often highly profitable) businesses, " said Enrich. "Having an institution with the credibility and prominence of the Council of Foreign Relations weigh in supporting these criticisms and offering suggestions, based on international models, for how to rein in the competition is a most welcome development."