U.S. High Court Tackles Corporate Tax Breaks

Forbes reports:

There's an economic war being waged among U.S. states. They're fiercely trying to undercut each other in the game of promising big companies tax breaks if they set up shop or expand within their borders. Armies of lobbyists have jumped in to help powerful firms get a piece of the corporate welfare. And as a result, billions are being siphoned from state coffers.

A gloomy picture indeed, but is it illegal? The Supreme Court may soon decide. A group of Ohio taxpayers and small-business owners led by Charlotte Cuno sued DaimlerChrysler (nyse: DCX - news - people ), the state of Ohio and the city of Toledo over the $280 million in tax breaks that officials lavished on the carmaker when it agreed to sink $1.2 billion into its Toledo Jeep factory.

This picking of winners by state and local government is at odds with the conception that the law and government is supposed to treat people equally.