Over the course of the last month, Wisconsin Gov. Scott Walker has been scrambling to do damage control in the wake of revelations about one of his signature economic programs. In the name of creating jobs, this trademark initiative of the potential Republican presidential candidate handed hundreds of millions of dollars in taxpayer money to businesses across the state. But Walker’s administration apparently neglected to check if these companies actually hired any new employees as a result. Wisconsinites have been understandably roiled — but this is not a problem that’s confined to their state. Across the country, “economic development” programs in states such as Texas, Florida, Michigan and New York are handing out public resources to private hands in the name of spurring “job creators.” Astoundingly, they often fail to uphold even the most minimal level of accountability and oversight over how this public money is used. The solution to this problem is simple: When corporations fail to deliver on job creation promises, they should be forced to pay back the money. Elected officials need to enforce rules that not only track whether private beneficiaries of subsidies and tax abatements follow through on their end of the deal, but allow the public to reclaim funds that have been misused.

Job scams

In 2011, under the direction of Walker, Wisconsin created a new economic development agency called the Wisconsin Economic Development Corporation (WEDC). Within its first year, it awarded $41.3 million in grants, $20.5 million in loansand $110.8 million in tax credits to private entities, all for the purpose of “nurtur[ing] … business growth and job creation.” Walker’s WEDC set job creation targets — but did little to ensure that they were met. Far short of the 250,000 jobs that he promised to create, Walker could only report 5,840 new jobs from the WEDC after its first two years, according to the Center for Media and Democracy. Wisconsin mandates that companies receiving public funds must disclose payroll records and other information proving they have met certain wage, healthcare and job-creation requirements. But according to the non-partisan Legislative Audit Bureau, that didn’t stop Walker from transferring public resources to private coffers with little more than a wink and a nod to ensure that the state’s residents actually got anything out of it.

When a business fails to live up to its obligations, the public should get their money back.

What is more, the amount of cash available for the WEDC to carelessly dispense has grown. By the end of 2013, the state had awarded over $970 million in tax credits, loans and grants, according to the watchdog group One Wisconsin Now. That same year, the Wisconsin State Journal found that “employees of the Wisconsin Economic Development Corp … made a number of questionable and unexplained purchases, including season tickets to UW-Madison football games and iTunes gift cards, and contracted for services without conducting open and competitive selection processes.” It will shock no one to learn that some of the leaders who have been top recipients of WEDC funds were major donors to Walker’s reelection campaign.

Wider problem