NJ Activists are Fed Up With Corporations Pocketing Subsidies Without Creating Local Jobs

After decades of shady dealings between politicians and corporations, residents of Camden, New Jersey are demanding answers.

While Camden-based corporations have received more than $1.5 billion in state subsidies, the city consistently ranks as the poorest in the state, with a median annual income of $27,105 and a 36 percent poverty rate.

A local coalition, Camden We Choose, recently delivered petitions to their city council to force companies to disclose how many local residents they hire. If petition signatures are deemed valid, the council will either adopt the proposal this summer or kick it to the voters directly via a November ballot referendum.`

To coalition co-chair Ronsha Dickerson, this effort is the result of years of mounting frustration after seeing tax subsidy after tax subsidy handed out to large businesses with no real gains for local people.

“What we heard from the community while canvassing is that people are fed up with applying for jobs here in Camden and not hearing back, as well as the fact that these tax breaks have gone to those corporations,” Dickerson told Inequality.org. “And they haven’t felt any of the benefits from it.”

 

The petition proposal would apply to all companies with more than 25 employees in Camden. For example, Holtec, a manufacturing company based in Camden, received a $260 million tax break in 2014 – one of the largest ever awarded by the state – through the Grow NJ program, which offers tax incentives to businesses that build facilities and create jobs in New Jersey.

Four years later, Holtec CEO Kris Singh made thinly veiled racist comments in an effort to justify the small share of his employees who are from Camden, a city where over 40 percent of the population is Black.

“They don’t show up to work,” Singh told a local business journal. “They can’t stand getting up in the morning and coming to work every single day. They haven’t done it, and they didn’t see their parents do it. Of course, some of them get into drugs and things.”

That excuse sparked outrage among Camden residents who have lost out on jobs to people from higher-income, whiter surrounding areas.

“The only people I see working there are suburbanites,” Kelly Francis, a Camden resident and the former president of the local chapter of the NAACP, told NPR after Singh’s inflammatory remarks. “But these are the promises they make in order to get a foothold.”

Sue Altman, executive director of the New Jersey Working Families Alliance, told Inequality.org she hopes the Camden We Choose initiative will upend “the idea that giving money to politically connected corporations is somehow going to fix this city that has been impacted by decades of disinvestment.” She also hopes to create a model that will help other cities avoid falling into the “same nonsense trap.”

Subsidy failures are indeed a rampant problem, as officials get away with handing out sweetheart deals to powerful business leaders with few strings attached. A 2019 government audit of New Jersey’s Economic Development Authority slammed the agency for insufficient oversight of billions of dollars in tax breaks handed out over the previous 15 years, including a failure to monitor whether recipients created the promised numbers of good jobs.

Good Jobs First, a leading subsidy watchdog group, recently released a reportanalyzing 250 state-based economic development subsidy programs across the country. They found that just 37 of these programs disclose to the public the total number of jobs corporate recipients create with their subsidies, compared to the number they promised.

The Camden coalition’s proposal would add another level of important detail to such disclosures: the extent to which subsidies benefit the people in the community where the subsidy recipient is operating. Such corporate handouts are often justified by claims that they will be a boon to economically disadvantaged groups and communities.

“People here are up in arms about the fact that they cannot work here in their city at places that should be able to hire them,” Dickerson said. “The most important part about this is to remember that Camden residents just want what residents of any other city want: a place to live, worship, shop, and work to receive a fair wage.”

Rebekah Entralgo is managing editor of Inequality.org. You can follow her on Twitter at @rebekahentralgo.