Elected officials in Texas are exchanging high-fives over Toyota’s decision to relocate its U.S. headquarters to Plano. It’s no doubt a great boon to the state, but will it really prove so good for the politicians’ careers?
In the late 1980s and early 1990s, states and municipalities dangled millions in front of Japanese and German automakers looking to build assembly plants in the United States.
The millions Kentucky invested to lure Toyota’s plant to Georgetown, for example, drew not just the automaker but eventually dozens of Toyota’s suppliers to the state, with massive economic ripple effects.
But in many of those cases, a state or local politician got voted out of office after an opponent was able to attack the incumbent for giving away the store and overspending on the incentives.
The governor of Kentucky was term-limited, but the anointed successor lost in the wake of giveaways to Toyota.
The governor of Indiana lost after what was then Subaru-Isuzu Automotive got a bundle. The mayor of Flat Rock, Mich., lost in the election following the arrival of Mazda’s factory there.
Texas elected officials may want to be cautious when they crow.
Incentives handed out to suppliers and vendors to move from Southern California to north Texas in Toyota’s wake could become attack lines handed gratis by the incumbent to the challenger in the next election.