Roper: We do need to focus on our business environment

By Rob Roper

Gov. Phil Scott recently took some heat from the media over a statement he made following the announcement by Energizer that they would be closing their Bennington plant and moving its operations to Wisconsin. The governor said:

“This decision [by Energizer] is an unfortunate example of why those of us in Montpelier need to work together to make Vermont a more affordable place to do business and make sure our policies help businesses thrive rather than creating unique burdens and barriers to growth that make us less competitive with other states.”

Rob Roper is the president of the Ethan Allen Institute.

What’s wrong with that? The working together part or the making Vermont affordable part? Shouldn’t we want to help rather than harm our local businesses and be competitive with other states? But the criticism was that there is “no evidence” that Vermont’s business climate was the reason for Energizer’s departure.

Really? The Tax Foundation recently rated Vermont’s business climate as 44th in the nation. CNBC rated us 40th. Rich States Poor States rated our economic outlook as 49th. These ratings are not unique and, while imperfect studies to be sure, when they all reach essentially the same conclusion it should spark at least a little attention.

When businesses decide to lay off and/or relocate, they have no incentive to alienate local politicians by flat out stating, “You stink.” It’s much more diplomatic to adopt the old breakup line, “It’s not you, it’s me.” But we all know who it really is. It’s you. At that point, you can choose to start combing your hair, brushing your teeth, and bathing regularly, or you can cling desperately to the lie and wonder why you can’t get a date for Saturday night.

Unfortunately, our legislature seems inclined not only to believe the lie, but to double down on their bad economic hygiene. Adding a new payroll tax (Paid Family Leave), and all the added paperwork that will come with that, isn’t an attractive prospect for businesses. Nor is artificially increasing the cost of labor with a $15 minimum wage. (It’s worth noting that Wisconsin, where Energizer decamped for, has a $7.25 minimum wage.) Raising the cost of energy and regulatory uncertainty through the Global Warming Solutions Act, and raising the cost of motor fuel through the Transportation Climate Initiative aren’t helpful ideas either. And, given that one of the biggest issues companies have in Vermont is a lack of affordable housing for their employees, making housing construction even more difficult and costly with new Act 250 environmental regulations would be just another kick in the shins.

While there are many factors that contribute to a company’s decision to relocate, certainly the business climate in the state where it is currently doing business is a factor. In any competitive market place businesses will close and move and in some cases, even in most, there is little the state can do about it on the individual business level. The important thing is that the state creates the kind of dynamic economic environment that encourages, in general, new businesses to start or move in and grow at a faster pace than they close up or leave.

Following Energizer’s announcement we learned that Marvell Technology Group, after purchasing a division of Essex-based Global Foundries, laid off 78 employees, and Seven Days published an article about significant layoffs occurring at MyWebGrocer, Dealer.com, and Social Sentinel. All of these companies have operations in other states. Why is it that we so often hear of businesses consolidating and moving their Vermont jobs to other states, but rarely if ever do we hear the opposite?

Additionally, the grocery store chain Hannaford just announced it was giving up on plans to open a store in Hinesburg following a decade long battle with zoning, stormwater permits, Act 250 regulations, and a legal battle that went all the way to the Vermont Supreme Court with still no resolution to their issues. How many potential endeavors witness this kind of outcome and don’t even bother to try setting up in Vermont?

The governor’s statement was right on target. This is, truly, a problem we need to fix.

Rob Roper is president of the Ethan Allen Institute. He lives in Stowe.

Image courtesy of Public domain

18 thoughts on “Roper: We do need to focus on our business environment

  1. VT Democrat Party and other assorted leftists including Comrade Phil have caused this…problem is uncertainty…I tried to start a business a few years ago but would be unlikely to do it knowing what I know now. If so it would be small enough to be run by friends and fam for many obvious reasons.

    Uncertainty is the great business destroyer. Watching Benedict Scott roll in the hay with the Democrats and assorted leftwingers is what has killed it.

    No one ever knows when another leftwing-loony law is coming down the pike…paid family leave…healthcare debacle…Act 250…but what we do know is it’s not if but when

    Looking at the counties and and municipalities that are failing…and the bills that haven’t been paid. With fewer taxpayers and our youth leaving is decimating our state.

    – pensiongate
    – Lakechamplaingate and other algae blossom farms
    – Farmrunoffgate
    – the exodus from our state and an auditor that has been deceiving us abt this since taking office
    – 5000 state residents in a short amount of time on the disability rolls
    – EB5gate…what happened to the records disappearing, who stood to gain and where’s the investigation?
    – Bondrating drop trashed by our ‘leaders’ who clearly went to the school of Everyone Receives A Trophy
    – Our Preschools ruined!
    – *still* no adequate broadband after Vtels’ Guite received *millions* to privide but no accounting…politely asked legislature to back off?

    And just getting started…what fool would come here? In actuality we’re getting other economic refugees from NJ, CT & Yorkers

    Unless we get rid of the oneparty rule, have a *real* Republican/conservative governor and in the state house it wont happen…and more businesses will leave and families of all ages will also move out…VT is in the throes of a deathspiral…our new normal.

    • Add ruination of our schools, higher costs leveraged by excise, sales/income tax, insistance on our tiny state to lemminglike become the lowest carbon emitting state? With vastly more trees than ppl and overabundance of greenery…but still can’t see the forest? Its from the carbon, climate alarmists. So gas tax will further add to the deathspiral…

  2. Most of us so-called flatlanders have already made our fortunes in New York.Now we want a nice clean place to live with very selective business,mainly bistros & boutiques for the ladies.
    We don’t want to industrialize Vermont in any way.I’m actually hoping for at least a $2/gal. surcharge on fuel to fight climate change and keep the riff raff off the roads,or at least limit them.

  3. Bennington Iron Works, Globe Union Battery Plant, TE Corporation, and half a dozen more manufacturers have left Bennington in the last twenty years. All employed 45 or more employees. But there were numerous small companies that supported them and were seriously impacted. They either left, closed, or reduced employees. Two that readily come to mind are Pioneer Extras Motors and Lauzon Machine. Other corporate distributors are candidates for closure, like FW Webb, and Granite City Electric Supply. They were opened to support the many manufacturing companies that have long since closed. How long can they hold out before corporate decides it won’t continue to support their negative profits? The local economic damage is a lot more complex than one company shuttering it’s doors.

  4. The most important thing to Democrats and progressives, feeling smart and morally superior. Excessive taxes and regulation make these people feel so good about themselves.

    • “Half the harm that is done in this world is due to people who want to feel important. They don’t mean to do harm; but the harm does not interest them. Or they do not see it, or they justify it because they are absorbed in the endless struggle to think well of themselves.” T. S. Eliot

  5. My, my, my. A whole of complaining, with nothing to show for it. Did it ever occur to any of the whiners that this is exactly where the progs wanted us to be? The progressives wanted to de-populuate the state and will not be happy until anyone who is a normal human has left. I say let the progs have the state and let them have the consequences good and hard.

  6. There’s another gorilla perched in a room with the door shut but not locked. His name is Service Tax. He will soon be invited to Montpelier, introduced as another magic bullet- not as a tool to offset our rising tax burden but as a revenue source for more increased spending. Soon after this crack addiction passes through the legislature and lands on the governor’s desk-( Who will not be Phil Scott). This WILL drive our underground economy. There will be a sharp increase in barter agreements and cash sales of goods and services.

  7. Exacerbating the impact of Vermont’s employment decline is the proportionate increase in government, healthcare, public education and non-profit sector jobs. While these institutions typically consume more tax revenue than they create, nearly 40% of Vermont’s workforce is employed by these sectors and Vermont has the third highest nonprofit employment, as a percentage of total private employment, in the U.S..
    https://www.bls.gov/opub/ted/2014/ted_20141021.htm

    “How did you go bankrupt?
    Two ways. Gradually, then suddenly.”
    “The Sun Also Rises”. Ernest Hemingway,

  8. Since the 1960s, this state has lost multitudes of business in dairy and industry, until all that practically remains are services, retail sales, and government, the latter being the largest. I hold the government of Vermont responsible in all three branches. They have reduced my people to selling huaraches and serapes to touristas. Retail, services, and “green industry” will not support t he people across all counties. We need major industry to return and that won’t happen as long as the Democrats & Republican parties are united in making Vermont a socialist haven. Nearly all of them must be thrown out, especially the flatlanders who now enjoy warm seats in the Legislature.

  9. Took Walmart in St Albans 10-12 years to get permits, now open. The area could have benefited that many years prior. Foot dragging liberals, self importance looking out for the cows. You’d think there was to be a tanning (hide processing plant) having the same location problems. Starting a business is a huge financial endeavor in VT, if there’s fortitude.

    VT residents have to go elsewhere for stores along prosperous states. And the VT tax Dept still nails them for sales taxes. The state doesn’t loose, the people do. The state gets CC statements of residents—buy in cash.

  10. There to many in our legislature that have earned nest eggs elsewhere. Than decided that Vt should be their private yard, and seem dead set on forcing everyday Vermonters out via cost of living. Punishment taxes, that workers can not afford. Punishment taxes on business. The consistant large rate uncreases for electricity by the non public interest service board. They have what they need big homes already paid for, investment income to pay the punishment taxes.

  11. No evidence???? Are these folks brain dead? Last time I looked, I didn’t notice trucks lined up at our boarders loaded with stuff to start or expand businesses. In fact the out bound lanes were quite active. It’s this kind of mentality that drove us into the ditch in the first place. These folks in Montpelier just don’t get it. Again, yea reap what yea sows.

  12. The Emperor (the State) has no clothes but the majority of Vermonts’ legislature see it in Paris finery. A serious case of legislative mass dissociative psychosis.

  13. Gov. Phil Scott recently took some heat, ” Good ” !!

    This decision [by Energizer] is an unfortunate example of why those of us in Montpelier
    needs to work together to make Vermont a more affordable place to do business !!

    Actions speak louder than words, Governor !!….. Montpelier and its Liberals could care less,
    they have an agenda and making Vermont viable, is not in the game plan foolish regulations
    and tax after tax for what ……. more debt ??

    Energizer like Vermonter’s, are all moving to greener pastures, states where they appreciate
    you………… not just your wallet.

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