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Nike loses $1M grant for Arizona factory after recalling controversial sneaker

Arizona’s governor disagreed with the company’s decision to recall the controversial Fourth of July-themed shoe, slashed incentives for new factory in the state

Arizona Governor Doug Ducey, Nike's Betsey Ross Sneaker, and Colin Kaepernick (Credit: Getty Images and Nike)
Arizona Governor Doug Ducey, Nike's Betsey Ross Sneaker, and Colin Kaepernick (Credit: Getty Images and Nike)

A new Nike factory in Arizona has become a pawn in a footwear controversy that’s dividing local politicians.

After Nike heeded pitchman and former NFL quarterback Colin Kaepernick’s request to nix the new Air Max 1 USA sneaker, a Fourth of July-themed shoe, the company’s recently-approved $185 million factory in Goodyear, Arizona got dragged into the controversy, Reuters reported.

The state’s Republican governor Doug Ducey, who vehemently opposed Nike’s decision to backtrack on its shoe design, withdrew the $1 million grant the state had agreed to as part of the deal, according to the publication.

The shoe features the so-called “Betsy Ross” flag with 13 white stars that represent the original U.S. colonies, which Kaaeprenick said was offensive because it dated back to the American Revolution, when slavery was legal.

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“Words cannot express my disappointment at this terrible decision. I am embarrassed for Nike,” Ducey wrote on Twitter. “Nike has apparently decided that Betsy Ross is unworthy, and has bowed to the current onslaught of political correctness and historical revisionism.”

Later in the thread, he tweeted: “Nike has made its decision, and now we’re making ours. I’ve ordered the Arizona Commerce Authority to withdraw all financial incentive dollars under their discretion that the State was providing for the company to locate here.”

However, the mayor of Goodyear, Georgia Lord, who’s also Republican, quickly rebuked Ducey’s stance, assuring Nike that the city would “honor the commitment we made in our agreement,” which includes $2 million in waived fees and bonus cash for the 500 jobs the factory is slated to create.

The Democratic governor of nearby New Mexico, Michelle Lujan Grisham, seized on the disagreement to try to entice Nike to consider moving its factory: “Hey @Nike, let’s talk,” she tweeted. Her office reportedly reached out to the company as well.

In a statement to CBS News, Nike said “[we] remain committed to creating jobs in the U.S., including a significant investment in an additional manufacturing center which will create 500 new jobs.”

The dispute comes months after political opposition scuttled Amazon’s $5 billion headquarters that was initially destined for Long Island City in New York City. [Reuters] — Erin Hudson