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Daugaard Says Possibility of Fewer Handouts Hampering Business Recruitment

Governor Dennis Daugaard is "disgusted" that thousands of us South Dakotans have referred his corporate welfare law to a public vote. The governor won't challenge the refernedum in court, but he's already trying it in the court of public opinion:

[Daugaard]: "(The referendum) is very wrong headed ... and not what's good for South Dakota."

Daugaard disputed the Democrats' contention that the bill places corporations above health care and education.

"That's a ridiculous statement," the governor said, adding that the jobs and business created by the bill will expand the tax base, benefiting school districts [Randy Dockendorf, "Gov. Touts Business Incentives," Yankton Press & Dakotan, 2011.07.21].


Daugaard said recruitment of business projects has become more difficult since the determination last week there were sufficient signatures on the referral petitions. He said more and more businesses will be "held hostage" during the run-up to the vote.

Daugaard said a business choosing between South Dakota and Nebraska raised the question last week of how equipment purchases and related costs will be treated if the installation isn't completed by the end of 2012.

The governor said the uncertainty must be overcome too on another project with a likely payroll of 400 jobs where the choice is between South Dakota and Iowa.

"The same issue has come up," Daugaard said. "It's hurting us already" [Bob Mercer, "Business Grant Referendum Hurting South Dakota, Governor Says," Aberdeen American News, 2011.07.26].

Held hostage? Mercer put it in quotes, but I have difficulty believing mostly sensible Dennis Daugaard would let slip such an exaggerated and inaccurate metaphor. Comparing potential business recruits to "hostages" suggests the South Dakota folks who called for the referendum are hostage-takers, holding a gun to the head of good capitalists and threatening to deprive them of their life, liberty, and/or property. The hyperbolic statement belies the corporate entitlement mentality, the idea that corporations are entitled to special tax handouts from the government in addition to all the free market perks of hard workers, low wages, light traffic, cheap housing, and clean air that South Dakota offers.

State Rep. Bernie Hunhoff suggests that if anybody is entitled to a handout from Governor Daugaard, then everybody is entitled (hat tip to The Displaced Plainsman!):

The administration says the program will pay for itself through increased sales and property taxes. If that's the case, let's end the contractor's excise altogether and then the state's coffers will grow even more.

Let's end the tax for farmers who build a machine shed or barn. Let's end it for the family-owned car dealership under construction north of Yankton. Let's end it for the two women who tore down an old building on Howard's main street and built a new coffee shop and eatery. Let's rebate it for the entrepreneurs who restored the old bank building on Vermillion's Main Street into a fine steakhouse.

Let's end it for every businessman and farmer. But let's not let government pick winners and losers. If big projects get a rebate, Main Street should qualify for the same. Everyone should be treated alike when it comes to taxation [Rep. Bernie Hunhoff, "Pierre Report: Disgusted for the Wrong Reasons," Yankton Press & Dakotan, 2011.07.26].

Both state government and local economic developers suffer a certain corporate myopia: they are so dazzled by the big talk and big numbers of big corporate lobbyists who shell out big money to hunt and golf with them that they forget all about the free market and their own citizens who make the South Dakota economy work one job and one purchase at a time.

Hunhoff is right: the governor's disgust is misplaced. We should not be disgusted at the people's exercise of their right to refer laws. We should be disgusted at entitlement-minded big businesses who can't see the beauty and benefits of South Dakota without our waving extra cash in their faces.


  1. Erin 2011.07.27

    Nebraska and Iowa have corporate and individual state income tax. Isn't the fact that South Dakota has neither supposed to be enough incentive for companies to locate here?

  2. Steve Sibson 2011.07.27

    So Daugaard wants to ignore the loss in jobs from the money taken out of the economy in order to pay for the excise tax. Sounds like he agrees with the tax and spend Democrats in DC in regard to the debt ceiling issue. And so did all but one Republican legislator on HB 1230. And why is Bernie preaching the libertarian Tea Party line here? Perhaps the Tea Party should look at taking over the Democrat Party in South Dakota instead of the SDGOP.

  3. Roger Elgersma 2011.07.27

    The casino went to Iowa before our ballot referendum so our 'business friendly' opinion of ourselves has not held up before either.
    Daugaard wants to say we can increase our tax base by bringing in more jobs and more people. Well that increased tax base will be needed to build more schools near Hyperion for new kids. It will not increase the support that Pierre gives to the kids it cut this year. All this developement has new costs with it. Just ask anyone trying to balance the budget in Lincoln county when Sioux Falls grew fast in their direction. If the people already here do not do well is a huge indicator to those who are thinking of coming here. What does not work well for us will not work well for newcomers either. Sad but true.
    I grew up in Minnesota and kept hearing Sioux Falls tv stations telling us how good they have it while we had most of the businesses. But if they got one to move it made major news. Ninety percent of Minnesota college grads stay in state, fifty percent of South Dakota grads leave. Sure they can go anywhere from here, they have to. But all the money we scrimped on their education goes somewhere else. We could steal your best up and coming young professors, and keep our kids. But as long as Janklow had a big mouth some thought you had us beat.

  4. Chris S. 2011.07.27

    Sibby: Bernie Hunhoff's positions are classic Democratic populism, not "libertarian." If you agree with the policy but recoil at agreeing with a Democrat, that's fine, but it doesn't make the policy "libertarian."

    Also, it's the "Democratic" party, not the "Democrat Party," but whatever. Still, when so many people are concerned about "English Only" policies in the USA, then using English correctly ought to start at home.

  5. Steve Sibson 2011.07.27


    True Republican conservatives and true "Democratic" populists have a common foundation...the little guy. The leaderships of both parties are for the big guy...power, money, and centralization and concentration of both. We need to get beyond the theatre. And for the record, I appreciate the relationship I have with Bernie and many Democrats I work with in Pierre.

  6. Chris S. 2011.07.27

    Point taken, Steve S. Thanks. :)

  7. Charlie Johnson 2011.07.27

    Just consider the source of disgust---GDD. The same GDD who tore apart education and medicaid. Very least corporations are left standing at the end of the day. The same can not be said for students, elderly, and disabled. Shame on GDD.

  8. Roger Elgersma 2011.07.27

    If Daugaard thinks less for business hampers business, does he also think less for education would hamper education and kids.

    [CAH: Touché, Roger!]

  9. Guy 2011.07.28

    Corey, who cares what the Governor thinks? This referendum has FINALLY unveiled the mask, bringing the issue of government responsibility to the fore front. This issue is forcing people to wake up and see who works for the citizens and who works for the corporations.

  10. Guy 2011.07.28

    ...and so...the more Governor Daugaard speaks, the MORE HE REVEALS who he really works for.

  11. Steve Sibson 2011.07.28


    Google "crony capitalism" Obamacare AARP and learn who else does not work for the citizens or its members.

  12. Douglas Wiken 2011.07.28

    What are Daugaard's comments on the Congressional Republicans diddling and fiddling playing games with the debt limit and destroying consumer and corporate confidence in the US economy?

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