‘100 homes and farms were destroyed’: Donald Trump wiped out a town to build a new factory that never happened, now Biden is fixing his failure

In 2017, then-President Donald Trump announced with great fanfare that Foxconn, the Taiwanese electronics giant, would build a massive $10 billion factory in Wisconsin. The deal was touted as a game-changer that would bring 13,000 jobs to the state and revitalize American manufacturing. Trump called it the “eighth wonder of the world.”

Mount Pleasant bought up around 3,000 acres for the Foxconn project and borrowed around $350 million for building the infrastructure and buying lands. Fast forward to 2021, and the reality has proved quite different from the grandiose promises. The Foxconn factory site in Mount Pleasant, Wisconsin sits largely empty and the buildings that have been constructed are a far cry from the sprawling high-tech campus originally envisioned.

Instead of the promised Generation 10.5 LCD manufacturing facility churning out large panels for TV screens, what ended up getting built was a much smaller Gen 6 facility suited for making phone screens. The number of jobs created has also fallen woefully short. By the end of 2022, Foxconn employed only a few hundred people in Wisconsin, nowhere near the 13,000 promised.

Subsequently, Moody’s Investors Service downgraded Mount Pleasant’s credit rating, citing the village’s heavy debt burden and the uncertainty surrounding the Foxconn project.

So, what actually happened?

First, it seems Foxconn vastly overestimated the demand for large LCD panels when they made their initial plans. By the time construction began, the market had shifted, and building a massive LCD factory no longer made economic sense.

Second, there were issues with the contract itself. Wisconsin promised Foxconn a record-breaking $4 billion in subsidies, but the incentives were tied to capital investment and job creation benchmarks that Foxconn struggled to meet as plans changed. This led to a standoff over the subsidies. Many have also pointed to the chaotic nature of deal-making in the Trump era, arguing that the project was rushed and not properly vetted. The Trump administration wanted a big manufacturing win, while then-Governor Scott Walker wanted a game-changing economic development deal ahead of his re-election campaign. Some feel Foxconn took advantage of this to over-promise and secure an overly generous deal.

In 2021, under a new deal negotiated by Wisconsin Governor Tony Evers, Foxconn’s tax subsidies were slashed from $4 billion to a more modest $80 million. The deal effectively acknowledged that the project would be much smaller in scale than originally proposed. By  2023, Foxconn still hadn’t met its revised hiring targets and it remained unclear what the company’s long-term plans were for the Wisconsin site. The campus was oddly empty, with only a handful of cars in the parking lots. 

What do the residents say?

The residents of Mount Pleasant who were displaced by the Foxconn project have expressed a range of emotions – anger, frustration, heartbreak, and resignation. Many felt they were being forced out of their homes for a project that wasn’t fully thought through. Kim and James Mahoney, who had lived here, were one of the families affected. They argued that their homes were not “blighted,” as the village claimed, and that the use of eminent domain to benefit a private company was unconstitutional.

Some residents, like Sean McFarlane and his family, tried to fight back. They refused the village’s initial offer of $22,000 and hired an attorney to challenge the eminent domain proceedings. But in the end, facing the prospect of a lengthy and costly legal battle, they felt they had no choice but to settle elsewhere.

Now Biden is showing how it’s done

It seems that where Trump’s grand promises turned to dust, the Biden administration is hoping to build something more concrete. The announcement of Microsoft’s $3.3 billion data center project in Racine is a significant win for the region, especially considering it’s on the same site where Trump once touted Foxconn’s now-defunct plans.

There’s a certain poetic justice in Biden choosing this location to highlight his administration’s efforts to boost domestic manufacturing. Biden’s approach seems to be more grounded in reality. The legislation he’s signed into law – from the Infrastructure Investment and Jobs Act to the CHIPS and Science Act to the Inflation Reduction Act – all contain provisions designed to promote domestic manufacturing. Of course, it remains to be seen if Biden’s manufacturing push will truly pan out.