Go South, Old Manufacturer, Go South

Caterpillar may move slowly, but it is reacting to the reality of the business environment and not the way things might be if they were different:

An Illinois newspaper is reporting that giant Caterpillar will not build manufacturing facilities in the company’s home state – Cat is based in Peoria, Ill. – due to poor business conditions in the state.


TBJ has reported that Cat is looking at sites in Brunswick County on the North Carolina coast.

Oh, you don’t say? This must be news to our President. Does he not believe that Illinois epitomizes that which is best about our country?

In a letter sent to the Illinois town which was lobbying hard for the new plant, Caterpillar wrote:

‘Please understand that even if your community had the right logistics for this project, Caterpillar’s previously documented concerns about the business climate and overall fiscal health of the state of Illinois still would have made it unpractical for us to select your community for this project,’ the letter reads in part. ‘Caterpillar intends to continue calling for long-term changes in Illinois and to offer help to the state as it works toward real and fundamental reforms that will position communities like yours to compete for future projects.’

The best way to compete for future products? Don’t be bleeding out businesses and individuals with your state’s regulatory and taxation costs. A quick comparison between NC and IL will show that while the first state has a 6.9% corporate tax rate the latter state has a 9.5% corporate tax rate.

One could almost imagine that those numbers alone would make a difference. Then, if one goes on to compare the right-to-work state of NC with the right-to-strike state of IL, is it any wonder that the business is tracking south and east?

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