FREAK Shots: Is Google the Gift That Keeps Taking?

To get Google to open a major routing center in Lenoir, N.C., and bring with it 200 jobs and about $172 million in local investments, the state and local governments offered the company $200 million worth of incentives, reports The Lenoir News-Topic, including sales-tax-free electrical power and computer purchases.

When the deal was signed in 2007, some members of the community grumbled that Lenoir “gave away the farm.” Apparently, however, the giveouts continue — at least by one local restaurant, which, a blog reader tells us, got this sign from Google as a thank-you for delivering free pizza to them every Tuesday.

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Addendum: A Google representative claims the company pays for its food every time it orders from a restaurant and gives the above sign to local restaurants it patronizes frequently, not as a thank-you for free food.

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  1. Paul says:

    So a pizza place gives Google free pizza every week. I’m sure they have a motivation, whether it’s because Google employs friends and family of the owner, because Google drives business there the other 4 days, for the advertising, or something else. This is Freakonomics, I’m sure you can come up with other reasons why the pizza place would do this.

    Google and its employees, in return, give them a framed thank-you in return. How terrible.

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  2. blc says:

    I presume you meant $172 million, not $172.

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  3. Zach says:

    I don’t get it. Why does the pizza place give Google free pizza?

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  4. Gabjoh says:

    That’s not $172,000, but $172? Wow…

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  5. Rory Wohl says:

    I hope that’s $172 million in local investments not just $172.

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  6. jonathan says:

    Municipalities economic development staff always “give away the farm” to any large business, particularly in a recession. I am a little suprised that they only gave $200 Million for 200 jobs.

    The ironic part is that small business, which employ the overwhelming majority of people, never get any incintive to expand.

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  7. Kathy A. says:

    jonathan has it exactly right. I’ve long complained to my city that giving these large incentives to big business is foolish. The incentives cost more than the jobs created, and in every case the large business has left for greener pastures as soon as the incentives run out.

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  8. assumo says:

    The sign seems a lot like a picture of a celebrity that you might see at an old diner. It’s interesting that the “google” brand is infinitely more recognizable than any person within the organization. Getting a google ad for a thank you gift seems a little impersonal, but it was probably the best the company could do to boost the local joint’s reputation.

    As far as incentives go, if a business has any chance at longevity, say 20 years, the marginal cost of the incentives is not that great. Outside of the employees earning money to spend in town, the city gets property tax and a future draw for related businesses. When you’re as solid as google, you get to choose where you locate. The sweeter the incentives, the more some other factors may be overlooked.

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