BREAKING: Astra Zeneca to Cut 1/3 of Delaware R & D Force
Ya see, these obscene tax breaks and other incentives come with no guarantee. Say buh-bye to 550 top-paying jobs.
No doubt, what WON’T be cut is Astra Zeneca’s steady stream of contributions to our corporate controlled legislators.
Here’s the bad news:
Cuts at AstraZeneca’s brick complex on US 202 between Wilmington and Chadds Ford include “550 research and development” professionals “due to our exiting psychiatric laboratory research” between now and 2012, AstraZeneca spokesman Tony Jewell tells me. “That’s about one-third of our research and development presence in Delaware.”
Delaware moved US 202 and offered tax incentives to move AstraZeneca and over 4,000 jobs from Chester County and other Pennsylvania sites earlier this decade. But that was before the drug business headed south… AstraZeneca says it’s going to cut 3,500 research & development jobs worldwide.
This is what happens when businesses are allowed to pit states against each other. It’s the pits.
And it’s time to stop this insane game of Relocation Musical Chairs. As always, the only losers are the taxpayers. At least, we’ll always have those labyrinthine traffic circles adjacent to 202 as a memorial to the greedy excess that was and is Astra Zeneca. And, the Pit.
So, what you are saying is that we should have let AZ put its headquarters up in King of Prussia and still lose 550 jobs. Gotcha.
When it’s all said and done, this could well end up being a money-losing proposition to the state. Which is what happens when you are forced into giving up the store (and the Pike) during negotiations vs. other bidders.
In the meantime, this will strike another blow to the State’s already-teetering finances.
This is terrible news. I feel awful for all those technical professionals that will soon be out of a job in this horrible job market.
The AZ people I know tell me that all the R&d has been moved to India. How are you going to out bid India? You can’t so the strategy of economic development through chasing large companies with tax breaks is just stupid. But it did not just become stupid it has been stupid from day one.
The one good thing about Delaware( the reason these co
panies will keep any footprint) is that the Senators and Congressman are dead cheap to purchase.
When did that whole begging-companies-to-come-here-for-the-best-tax-breaks tactic start in Delaware? Under Pete, Mike or Tom?
My impression is that Carper was the undisputed master of wheeling & dealing with prospective employers, but I’m not sure if he started it here or not.
Time to start rethinking this tax breaks for jobs exchange. Other cities and states are. If AZ got tax breaks to bring X jobs to the area, those tax breaks should be reduced in accordance with the size of the break.
Tom and Pete screwed the entire country by eliminating usery laws which was the biggest giveawy to any industry in the history of capitalism.
It was Gov. Pierre duPont who pushed for the ‘Financial Center Development Act’, the one that legalized usury and attracted MBNA and its ilk to Delaware.
I object to the complaints about the re-patterned traffic. It’s now far easier to get from the Tyler McConnell to Foulk Road and the rest of Brandywine Hundred, and traffic through neighborhoods has been eliminated along Mitchell Road. The redesign also engineered the state’s No. 1 accident site out of existence. Those roads were going to need replacing by now anyway — only we wouldn’t have the money for it on account of we got this depression on and all. And ES, I know you’re smart enough to figure out how to go through a traffic circle.
As Nemski notes, the alternatives were to spend money to gain the jobs and hope to come out on the winning end — or lose all the jobs (about 2,000, wasn’t it?) right at the outset. I’ll let someone better at numbers do the math, but I think we came out at least slightly better with the direction we took.
Oh please…and no one was whining for nearly 2 generations of feasting. Time to re-invent ourselves–get cracking!! The famine is growing closer.
A-Z’s political ‘contributions’ to Delaware Federal level candidates since 1998.
http://www.opensecrets.org/pacs/pacgot.php?cmte=C00279455&cycle=2010
Year Candidate
…….. Castle.. Carper
1998.. $1,500 ..—-
2000.. $2,000 ..$5,000
2002.. $—– ….$1,550
2004.. $3,000 ..$4,130
2006.. $2,000 ..$4,320
2008.. $1,000 ..$—-
2010.. $2,000 ..$—-
Joe Biden did not receive any ‘contributions’ from A-Z.
I object to JC and Geezer. This was bad long term strategy from the outset. The fact that we made some quick money off the deal is not persuasive. Had the same resources given away to fortune 500 companies gone to venture capital subsidy over the past 20 years, we’d be adding jobs today, not talking about them going to India.
Delacrat: nothing since 1998? They are doing what every other corporation is doing moving our jobs to India, China, Mexico or wherever. They never had any allegiance to America same as all the others. They only allegiance they have is getting the bigget profits they can while screwing Delaware on the way out the door. NO MORE Tax Cuts for any corporation. Damn didnt we learn anything from MBNA?
Who has the information on much the government gives these companies for research and development? Once they develop a product they patent it and then take all the profits. Do they ever pay the government back for the R&D money?
We did get a roundabout (Augustine Cutoff) with the deal and that was worth it all!
I’m wondering if Castle will return the $2,000 AZ gave him for his Senate race.
and hope to come out on the winning end
Hope really is not a plan.
These companies get real taxpayer dollars (in the form of credits or real subsidies) for telling people that there is a pot of gold at the end of the rainbow that = X jobs. What we know now is that the pot of gold is ephemeral (and we should always know that the tax credits and subsidies don’t help to employ anyone — they go right to the firm’s bottom line). I’m just saying that these credits and subsidies need to be made with a way to get them back when the jobs do not materialize of if they disappear.
Geezer, you should talk to the people who live around Fairfax. They are saying that DelDOT swore that the road adjustments of upper Foulk and –what is it Veale–along Fairfax would have reduced traffic because of the 202 ‘improvements’. It is now a hellish nightmare for many and now DelDOT is seriously thinking of cutting off the traffic flow into Fairfax from Foulk.
The Route 141 is ok except if you are trying to take the old left to get to the Dupont Country Club. WTF?? And the signage is pathetic. Who knows the Road Numbers. They need to have the road names.
An aside – when I realized that Biden’s mom was attending the Catholic church off of Silverside and Weldin, I figured that the Biden’s must have loved the shit out of the 202 improvements –seeing as how easy it made the drive to worship.
Well, I object to your objection and appeal to reality. The last 3 decades have been a “re-invention” of sorts of the American economy. NO ONE could have ever imagined the computer, internet, wireless, and global melding would have become the view our new landscape. We as Delawareans were VERY fortunate to have reaped from the front end. I lived in states where for 20+years talk “of the steel mill closing” were going on, and it when it finally did, everyone walked around with not one bit of any other skill or acquired knowledge vis a vis continuing ed courses, night school, etc.., even though the company offered it!!! It was just easier to blame the economy, or the company, or the state. Jason330–could have–should have–would have is real weak in the face of a state that DID prosper for many years under do, and did. Our problem now–we’re done. And need to turn this around. Venture capitalist subsidies instead of ALL the jobs we did provide? For the most part, you know in your heart of hearts it would have kapoofed with the rest of the dotbomb industry. We need product at this point…and that’s where I would want to see any venture capital going from this state, at THIS point in time. So take off that Monday morning quarterback shirt–and get back in the game. And don’t worry, you’ll eat–there’s always muskrat:)!
just kiddin, A-Z is British outfit, headquartered in London, once known as ICI. They’re shuffling jobs from one former colony to another.
Right, Cassandra. And the problem of allowing companies to basically play one venue off against another is that you’re always dealing from a position of weakness. Suppose, for example, that in order to ensure that the taxpayers are protected, you try to negotiate guaranteed minimum tax based on a baseline set of employees/baseline salary projection. Well, guess what? Delaware County might just waive that requirement. What you end up with is an ever downward trending spiral of corporate obligations in any such negotiation. It’s why it’s a failed model.
As to Castle, this is one big check that he WON’T be appearing in public with…
hmmm AZ announced cut backs in R&D… could it be they are anticipating the impact of Obamacare??? nah, just a bunch of evil rich white guys F/n with us so they can laugh about it at the country club bar.
You need detailed directions, GPS and a Nepalese Sherpa to get to the Blue Ball Barn.
And, JC, Delawareans and credit card holders as a whole suffered from usurious interest rates set in motion by the Financial Center Development Act. And quite a few people objected both locally and nationally. But not those bought and paid for by the ‘Delaware Way’. Anyone who did was marginalized by the News-Journal and the so-called ‘establishment’. They always knew better. Or had the ability to bluster better.
Has the nation as a whole really benefited by 17.9% credit card interest? I certainly don’t consider that a closed question by any means.
on a less sarcastic note,
much needed road improvements and tax breaks were used to lure a scientific employer to Delaware which offset a decade of job losses due to a shrinking scientific employer (DuPont). It was and is a win-win.
It is the anti busines anger of the Democrat left that makes it so hard to attrack employers to Delaware.
ElSom–Tease out the issues between financial industry and corporate chemicals, and I’m more apt to agree. jason330 broad-stroked w/ his paint roller across all of major job markets here in Delaware. And that’s what gets me looking for the wooden spoon…….
Oh, romeo, romeo, you’d grant any corporation “droit de seigneur” to “attrack(sic) employers to Delaware”.
“these obscene tax breaks and other incentives”
how about some facts and figures to go with the invective and vitriol?
How big a tax break? from when to when? What “other” incentives? at what cost?
It is self evident that large multi national companies that come here for short term tax advantage have no loyalty to the state or it’s workers. However, small businesses employee half of all workers and are much less liikely to relocate. Which type of business should the state try to encourage? Okay then. Case closed.
Romeo: Those numbers are available, but you’ll have to search for them. The problem is that they tended to be expressed as one total number, rather than a certain amount in tax breaks, a certain amount in road improvements, etc.
“Geezer, you should talk to the people who live around Fairfax. …It is now a hellish nightmare for many.”
I think they misunderstood what they were being promised. The new road from 141 to Foulk diverts a good bit of traffic, but not all of it. I actually drive those roads several times a week. There is less traffic than there was before the change, period, and I’ll wager DelDOT figures back that up. It’s not my fault your sources are whiners.
They are saying that DelDOT swore that the road adjustments of upper Foulk and –what is it Veale–along Fairfax would have reduced traffic because of the 202 ‘improvements’. It is now a hellish nightmare for many and now DelDOT is seriously thinking of cutting off the traffic flow into Fairfax from Foulk.
PS, romeo: If you are able to read, try reading the explanation from AZ: They are getting out of the psych drug business. Maybe they’ve come to realize that no amount of pharmaceutical intervention will restore conservatives to sanity.
It is self evident that large multi national companies that come here for short term tax advantage have no loyalty to the state or it’s workers. However, small businesses employee half of all workers and are much less liikely to relocate. Which type of business should the state try to encourage? Okay then. Case closed.
AZ is the totally predictable outcome of a stupid bi-partisan economic development philosophy.
small businesses employee half of all workers and are much less liikely to relocate.
I agree with the sentiment but it’s not that clean-cut. Big business (or their employees) are the main customers for a lot of small businesses.
El Som wrote “When it’s all said and done, this could well end up being a money-losing proposition to the state.”
Based on what numbers? When will it be “all said and done”?
Getting AZ to come to Delaware was a huge win for the state, even with the layoffs announced today. Y’all are acting like it is closing its doors; it is not. Cutting 500 jobs still leaves 3,500. Businesses expand and contract. That is the way it is, so everybody can stop jerking their knees.
While taking AZ’s money, will Castle stand up and support the administration’s efforts to create new jobs in Delaware and beyond or just continue to be a Republican rubber stamp? If he wants RNC money for his campaign, my bet is on the latter….
Actually, anonone, I would love to see an impartial review of the numbers as well.
Since everybody, to one extent or another, has got a dawg in the hunt, not sure who would do it, though…
“While taking AZ’s money, will Castle stand up and support the administration’s efforts to create new jobs in Delaware and beyond…”
Castle has been very supportive of the Markell Administration’s job creation efforts. Markell has, countless times, singled out Castle’s efforts to support his administration. If you need proof, check out Markell’s comments at Fisker.
El Som, my point is that 3,500 jobs remaining is still a lot of jobs and that it will be a long time until it is all said and done. Considering the number of good jobs AZ brought to the state, the jobs in small businesses it supports, and the investment in its own infrastructure, I think that it has probably already paid back the state handsomely.
And my point is that we paid a lot in terms of commitments, tax breaks, infrastructure improvements, easements from Code requirements and the like, so we just don’t know. DEDO will no doubt tout revenues, but I’m looking for hard empirical analysis.
Plus, we’ve cut similar, although less ambitious, deals with other companies with perhaps even more dodgy results.
Plus, all of this deal-cutting begs the question of what we’ve lost by taking the easy route over the years rather than organically creating a sustainable economic blueprint for the future. Engaging in company russlin’ is not a sustainable blueprint, and that’s what we did here.
“Actually, anonone, I would love to see an impartial review of the numbers as well.”
why bother, you have made you feelings on the subject clear:
“these obscene tax breaks and other incentives come with no guarantee”
“Astra Zeneca’s steady stream of contributions to our corporate controlled legislators”
” the only losers are the taxpayers”
you have emoted clearly on the subject, why muddy the waters with facts and figures now?
Because, since the duPont years, we have been fed fiscal cheerleading masquerading as stone cold fact. Virtually every element of it, the FCDA, Delaware’s status as a ‘corporate haven’, tax breaks to lure businesses, all favor corporate interests over everybody else’s.
For once, it’d be nice to see what a clean empirical analysis would actually demonstrate.
Reasons not to do it: Those in on the deal would finally be unmasked.
So it’s not going to happen.
Anonone,
“Bringing jobs to Delaware”, does not necessarily mean more jobs for Delawareans. Many of the 4,000 jobs were filled by people moving from King of Prussia and elsewhere.
They still pay Delaware income taxes, though.
Paid.
500 paid. 3,500 still paying.
tick, tick, tick…
Go buy some drugs, Jason, and help ’em out. Some of their acid suppressants and anti-depressants might help your current situation. 🙂
Well this is fun. Watching A1 admonish someone to live with what you can get.
We should call up legislators and tell them to just kick out the entirety of AZ if we can’t have those jobs they’re turning loose.
I was loving the irony as well.
I didn’t know that AZ is related to ICI… will have to google that one.
I know that ICI Stuart Pharmaceuticals previously occupied the original portion of what is now the Astra Zeneca campus. Don’t know if there was any sort of merger involved.
delacrat@2:09 “just kiddin, A-Z is British outfit, headquartered in London, once known as ICI”
*
I don’t know why but it strikes a plausable note. I do know that International Chemical Inc owned the property. I didn’t think AZ was ever ICI but it could well be the case.
These kinds of tax breaks for business should have built-in triggers to scale up or down based on the number of jobs.
as a I shareholder all i can say is Woooohoooooooooo!!!!!!
More for me!!!!!! Keep electing the same idiots!
Now can I ask what has Markell done? How much did that trip to Europe cost Delaware tax payers last month? Seems like a good ROI for Delaware.
I wonder if the Pharma companies can see both sides of the aisle in Congress SNARLING at them and breathing fire in their direction and might have thought…
Hmm…better be prepared for the legislative rape about to be given to us.
And to think some of you are Delawareans……!!!! For shame..you can’t remember it was ICI to AZ? Well, let me take you back to the ATLAS days……
Everybody wants free drugs while at the same time expecting the drug companies to give every person a job for life. Silly.