The news papers reported yesterday that Toyota and Mazda
would spend about $1.6 billion to erect a new assembly plant near Huntsville. The choice of location was not described in detail but appears to involve:
*Generous tax abatements by the state of Alabama
*No history of strong labor unions in Alabama
*The recent practice of foreign firms locating assembly plants in a arc extending, roughly, from Charlotte toward New Orleans.

Does this mean that governors in the Midwest were not ready to offer substantial tax reductions to attract a new plant? Michigan adopted a substantial new tax reduction plan for firms that bring new jobs to the state last summer. Is there more to the story of the Toyota/Mazda decision?