When the economy is down, businesses know that there are fewer people spending fewer dollars, so they provide incentives for their customers to buy from them instead of their competitors. This comes in the form of lower prices, increased services, or even deals like Nissan and Hyundai are promoting such as taking your car back without penalties if you can’t make your payments.
Businesses do this because they know they need to keep cash flowing in order to survive. In the same way, states need to compete for business presence if they want to have solid economies. States have various ways of doing this, such as providing subsidies, paying to train a new workforce, and renewable energy incentives programs. And studies show that none of these methods really work. States that implement these programs are among the worst in their deficits, business prosperity, and therefore individual prosperity.
There are other methods though, ones that are more in-line with free market thinking, and that actually work. These include the lowering or complete elimination of personal and corporate income taxes, and limited red-tape. If Arizona is to lure businesses here, those that create jobs and inject money in the economy, we must create an environment such as this. If you were starting a new business and had your choice of any state in the union, would you prefer higher taxes or lower taxes? More red-tape or less red-tape? More of government telling you how to run your business, or less? The answer to solving Arizona’s economic problems, such as rising unemployment, is abundantly clear.