After Shoe Controversy: Arizona Rescinds Tax Incentive For Nike Factory

Jul 3, 2019
Originally published on July 3, 2019 7:30 am
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NOEL KING, HOST:

Nike designed a shoe that had a Revolutionary War-era flag with 13 stars. That shoe was supposed to be released for the Fourth of July. But then there were protests from Colin Kaepernick, the quarterback who became an activist, and others. They say that flag is a throwback. It comes from a time when slavery was legal in this country. So Nike pulled the shoe, and then came the right-wing pundits.

(SOUNDBITE OF MONTAGE)

JESSE WATTERS: I think they're trying to destroy the flag.

UNIDENTIFIED PERSON #1: They are so politically correct.

WATTERS: It's now anti-Americanism.

UNIDENTIFIED PERSON #2: What is with this constant harping with the left?

WATTERS: And now Nike and Kaepernick are literally ripping the fabric of the country, the flag, apart.

KING: But then something beyond just talk. Arizona's governor, Republican Doug Ducey, said he will withdraw tax incentives that Arizona had offered Nike to build a $185 million factory there. Reporter Maria Polletta has been following the story at the Arizona Republic.

Hi, Maria.

MARIA POLLETTA: Hello. Thanks for having me.

KING: So - just quickly - why is the governor upset?

POLLETTA: So as everyone alluded to in the clips that you just played, the governor feels that Nike is bowing to political correctness. He feels like the company is engaging in historical revisionism and that they're not really standing their ground on an issue that he doesn't see as valid.

KING: So he says he's going to withdraw this tax break that he was giving to Nike to build a plant to create jobs. What was the agreement between Arizona and Nike?

POLLETTA: Well, there are two parts of this agreement. The one that the governor canceled or wanted to withdraw was a grant that was going to be up to a million dollars from the state's commerce authority. There's also a separate deal with the city of Goodyear, which is the city where the plant was going to locate, that has about $2 million in incentives. The governor has no control over those incentives.

KING: OK. So I guess withdrawing that tax incentive, it sounds like it might not be a big deal for a multibillion-dollar company like Nike if the governor is not controlling the Goodyear incentives, right?

POLLETTA: That's correct. We'll have to see what happens. We, of course, were trying to get specifics from Nike all day yesterday in terms of their plans. We had Goodyear officials telling us, you know, all still, (laughter), full steam ahead, that they weren't expecting anything to change. Nike issued a statement saying that it was committed to still establishing a manufacturing plant with 500-plus jobs, but it did say committed to doing so in the U.S. It did not specify Arizona. It did not specify Goodyear.

So we're waiting to see what happens and if that continues and whether, you know, as you said, this one million-dollar incentive is enough to make a difference just in terms of Nike feeling that state officials aren't open to working with them or partnering with them anymore.

KING: That's interesting. But the Goodyear incentives for now are staying. As you've been talking to people in Arizona, have they talked at all about the prospect that the governor is, you know, stopping jobs from coming to the state? That's a very big deal, 500 jobs.

POLLETTA: Absolutely. This has caught a lot of attention because Governor Ducey has really painted himself as a jobs governor. He's constantly making fun of California, mocking them for, you know, interfering too much in business dealings. So some people are really feeling that the governor is being a bit hypocritical here. After having been a vocal proponent of local control, they feel like he's meddling in Goodyear's affairs. He feels like they're punishing Nike - excuse me - that he's punishing Nike for exercising its right to make its own business decisions and ultimately punishing some Arizonans, who are going to be affected and jobless if this plant doesn't happen.

KING: Maria Polletta of the Arizona Republic joining us via Skype.

Maria, thanks so much.

POLLETTA: Thank you. Transcript provided by NPR, Copyright NPR.