The Michigan Strategic Fund (MSF) board, appointed by Democrat Gov. Gretchen Whitmer, approved $715 million in grants and tax exemptions on Wednesday for a battery manufacturer with deep ties to the Chinese Communist Party (CCP).
The SMF board, chaired by Quentin Messer and comprised of 11 members appointed by Whitmer, reportedly approved the Renaissance Zone tax exemption request and handed $175 million in state grants to a China-based company named Gotion Inc, and its billionaire chairman, who has deep ties to the CCP, in order to build a $2.4 billion electric vehicle battery parts facility in the outer part of Big Rapids.
In total, as the Detroit News reported, the $715 million in grants and tax exemptions include:
The property tax exemption granted by the board for the Michigan Economic Development Corp. will save the company $540 million over a 30-year period, according to estimates. The approval comes after three local government boards last week unanimously approved the Renaissance Zone request for the project that’s expected to create 2,350 jobs over the next decade [Emphasis added].
The $175 million in grant funding is made possible through new programs the state Legislature created at the end of 2021 to spur economic development in the state.
The MSF board specifically approved a $50 million Strategic Site Readiness Program grant and a $125 million Critical Industry Program grant. The money for those grants will come from the state’s Strategic Outreach and Attraction Reserve (SOAR) Fund. The Michigan Legislature last week approved a $1 billion spending plan with $846 million going to the SOAR Fund [Emphasis added].
Ultimately, the state-run economic development agency would scheme to “attract” jobs to Michigan by way of a cash grab of hundreds of millions of dollars and a land grab of 523 acres for a company effectively operating as an arm of the CCP.
In fact, Messer told the Detroit News that the MSF was actively pursuing the business of the Chinese-linked company. In September, the Whitmer administration refused to disclose how much taxpayer money had been offered to lure Gotion to Michigan.
While Gotion will use the funds to build an electric vehicle battery manufacturing plant in Big Rapids, the company’s United States subsidiary was incorporated in California in 2014. But Gotion was actually founded in 2006 in Hefei, China, and was China’s first power battery company to enter the capital market. In China, the company appears to go by Guoxuan.
The company is headed by Li Zhen, a Chinese billionaire with deep ties to the CCP. Zhen is the second-largest shareholder of Gotion, behind only Volkswagen, according to Electrive, and is considered the company’s “de facto controller.” He was a member of the 13th, 14th, and 15th National People’s Conference Hefei Committee, a local affiliate of the Chinese People’s Political Consultative Conference (CPPCC).
According to the Diplomat, “the CPPCC today is a key part of China’s ‘united front’ work, which is designed to liaise with non-Communist Party members — and ultimately see them work with the CCP to advance its interests.” Mao Tse Tung infamously called the United Front one of his “three magic weapons,” along with the Communist Party and Red Army, in quelling pro-democracy republican forces in the Chinese Civil War.
Given all of this, Zhen’s position within the CPPCC means he was either a direct member of the CCP or a member of a satellite party with the mission of supporting the “United Front” and Communist policies in his region of China.
Whitmer, who is in a tough reelection battle this year, has already been criticized by Tudor Dixon, the state’s Republican nominee for governor, for allowing taxpayer funds to lure a Chinese battery parts company to the Great Lake State in hopes that it would create jobs.
After the grants and tax exemptions were announced for the company, Dixon told Breitbart News, “Just like Gretchen Whitmer’s sham parents’ council filled with donors and liberal activists, this is another echo chamber of Whitmer-appointed allies who will do anything she orders, including supporting foreign entities with deep ties to the Chinese Communist Party.”
“The bottom line on this deal is that Gretchen Whitmer is using Michigan taxpayers’ hard-earned money to line the pockets of a communist-party-tied Chinese Billionaire and prop up his new business venture while choking our own home-grown businesses to death with regulations,” Dixon added. “Real Michigan businesses need a partner-investor in Lansing. Not a career politician/lawyer cutting bad deals with their Chinese competition.”