Think about it, how much did different cities cooperated when trying to get Amazon's HQ2?
That said, you could at least narrow the problem by getting just the US, the EU, and China to cooperate. (But even that strikes me as a Sisyphean task. But what do I know?)
It would be rational for cities and states to lobby for the federal government to introduce legislation which makes the kind of tax breaks that corporations are angling for illegal.
Note: it is rational for them to simultaneously compete for corporate investment by offering individual tax breaks and lobby for such tax breaks to be made illegal at the federal level. This is rather hard to explain to many even otherwise intelligent people, but it's one of the most important lessons that game theory has to offer.
The EU was acting somewhat in this direction when it forced Ireland to collect taxes from corporations.
I know it's rational game theoretically. The question is would they ever do this? Likely not.
Why not? Because of the conflicting political ambitions involved on the part of key decision makers.
That's why my idea would be to create laws that make these deals null and void until they are put to a popular vote in the State or City or tax paying entity that will bear the burden of the costs.
I don't think it's hard to explain: it's the cities' equivalent to cartelization. It's no wonder why two competing firms would like to prevent each other from lowering prices, and they often lobby for laws to do that. The mechanism here is the same.
> I don't think it's hard to explain: it's the cities' equivalent to cartelization. It's no wonder why two competing firms would like to prevent each other from lowering prices, and they often lobby for laws to do that. The mechanism here is the same.
A city or a state isn't a "firm." It's not seeking the private profit of its owners: it's seeking the welfare of its citizens, which is part of seeking the welfare of all the citizens of a nation. When it comes to government, "cartelization" isn't a bad thing, because it keeps private interests from exploiting public divisions to harm the common good for private gain.
Cartels prevent "races to the bottom," but some of those are actually good for society (e.g. the race to the lowest price per unit of product-value). Other races to the bottom are bad for society (e.g. lowest standard of living per worker), and government cohesion can help prevent them by resisting the private interests that benefit.
Another problem in getting cities to cooperate against corporations seeking special deals, is that the "city" is actually "mayor or a few other bigshots", in that those are the people who would actually need to cooperate to get Congress or somebody else to stop this. But, this would deprive those same bigshots of the opportunity to sit in a room with the Amazon CEO (or whoever) and strike a deal. None of them want that. It's not the bigshots themselves who actually lose anything out of those deals, after all; their salaries and perks are untouched.
Think about it, how much did different cities cooperated when trying to get Amazon's HQ2?
That said, you could at least narrow the problem by getting just the US, the EU, and China to cooperate. (But even that strikes me as a Sisyphean task. But what do I know?)