North Carolina’s Senate Finance Committee is hastily arranging hearings on the state’s use of tax incentives to lure businesses, as public outrage mounts over disclosures that Google was granted as much as a quarter billion dollars in secret tax breaks for a plant expected to employ approximately 200 workers. There’s no word yet on whether any Google officials will be asked to testify.

Meanwhile, the controversy in the state reached a fever pitch this weekend, as anti-Google rhetoric filled local papers. In today’s Charlotte Observer, columnist Tommy Tomlinson writes:

Google is being modest. For proof, just Google the phrase “unbelievably one-sided deal.” You’ll get links to the Kyoto environmental accords and a few terrible basketball trades. But what should really top the list, where unbelievably one-sided deals are concerned, is the monumental unarmed robbery that Google is putting on Caldwell County and the city of Lenoir …

Businesses have all the leverage. I understand politicians have to cut sweet deals. But sometimes the deal is so sweet it’ll rot your teeth. And you can bet that Google won’t be paying for the dental work.

Also in the Observer is another column, titled “Pop Goes Google’s Mystique,” by John McBride:

Bullying, like evil, is in the eye of the beholder. Government officials are used to giving orders, not taking them. Maybe some got hacked off when Google pulled rank. But check out this e-mail snippet from Google executive Rhett Weiss to Commerce Secretary Jim Fain: “This legislation has remained cursed with unfortunate and petty dickering from the legislative drafting side.”

Petty dickering? Well, yes. That’s the way our government by the people and for the people works. Not that Google seems to care. It demanded government officials sign nondisclosure agreements. Worse, many of them did … I’m not sure we have the right to get mad at Googlers for playing rough – just because they claim to be different than everybody else. Now we know they’re not.

In an editorial on Saturday, titled “Google’s Greed, Our Gullibility,” the Wilmington Morning Star writes:

North Carolina taxpayers could give $260 million to Google over 30 years – more than twice as much as first revealed. We’d pay more than $1 million apiece for 210 jobs, many of them offering middling pay at best. They’d be at a facility somewhat comparable to a power company substation: a bunch of equipment tended by a relatively few humans.

This super-secret giveaway “negotiated” by local officials and the Easley administration basically means that an international corporation that made $1 billion-plus in the last quarter of 2006 will never pay more than a fraction of its share of state and local taxes … Playing the role of gullible yokels to Google’s slick arm twisters, local officials did exactly what they were told – and kept it secret for months. Meanwhile, Google was bullying state officials, who also caved, though marginally less cravenly. We still may not know the full extent of this secret giveaway. Prudent parents may want to lock up their daughters.

Ouch.

In a column in today’s Greensboro News-Record, Ed Cone wonders why Google would put its sterling public image at risk to squeeze what for it is a relatively modest amount of money out of a state:

Google’s reputation is one of the keys to its financial success. People trust the company, which uses “Don’t be evil” as its unofficial corporate motto, to safeguard their privacy and provide accurate, unbiased information as they search the Web and use its other online services. If Google comes to be seen as just another soulless moneymaking machine, it might lose some of its competitive advantage.

And that’s what makes the California company’s behavior as it negotiated its Tar Heel deal so hard to understand. Google strong-armed the public partners with which it worked on the incentive package, in ways that would be unseemly even for a company that doesn’t publish a lengthy Code of Conduct that says things like, “Being a Googler means holding yourself to the highest possible standard of ethical business conduct. … When it comes to ethical conduct, we believe in erring on the side of caution.” Except, apparently, when an annualized amount equal to two-tenths of 1 percent of its profits for the trailing 12 months is on the line.

Others are defending the deal. In a letter appearing today in the Raleigh News Observer, James Fain, secretary of the state’s Department of Commerce, writes:

If Google does not locate in Lenoir, the county will have lost the opportunity for up to 210 new jobs at an estimated average wage of $48,000 and investment of $600 million. Without that investment in facilities, the county will not enjoy the economic impact of major construction activity, including the many construction jobs generated during the building phase. Grocery stores, barbers, laundries and other retailers would not enjoy the purchases of the new employees. And if Google does not locate in North Carolina, it will certainly pay no property taxes here …

We are pleased that Google will join the Caldwell County community, where its presence will make a positive economic and psychological impact. The company’s decision is affirming to a community which has suffered huge job losses and attendant despair. And that decision will not cost the state any money that it had before Google arrived.

The Googlegate controversy is unlikely to abate any time soon. Troubling new details of the secret deal-making continue to emerge. Today’s Charlotte Observer features a long article describing how public officials leaned on some local residents to sell their homes to make way for the Google plant. The mayor of the town of Lenoir, Davis Barlow, and the county commissioner, Tim Sanders, were among the officials who, according to the paper, went “door-to-door on behalf of the Internet giant Google. In some cases, officials returned to homes four or five times. Barlow and Sanders effectively used the personal touch, avoiding a drawn-out public debate that Google was secretly telling them would scuttle the deal. That personal touch enabled some residents to feel comfortable in selling their property.”

Among the people pushed to sell their homes was an elderly couple, Eugene and Violet Anderson. The mayor and other officials, under pressure from Google to secure the land quickly, told the couple that:

They wanted the Andersons’ property for a secret economic development project. And they delivered an unsettling message. They told the Andersons, both 86, that they didn’t have to sell but would risk being among the last holdouts in the changing neighborhood.

“I figured they’d take it if I didn’t sell it,” said Eugene Anderson, a retired upholsterer who was born in the neighborhood. “So, I made it easy on myself.”

An image is a fragile thing, as Ed Cone points out. In North Carolina, Google’s has been shattered.

UPDATE: Paul Teague, of the Caldwell County News-Topic, provides a good summary of the course of the Google negotiations: part 1 and part 2.

UPDATE: Under pressure from Google to finalize the deal quickly, local politicians never even bothered to complete an analysis of the economic impact of the tax incentives, reports the Associated Press.