From the Toronto Star:
More money for GM despite layoffs, McGuinty says:
Premier Dalton McGuinty says Ontario will give General Motors more
money for new projects, despite thousands of layoffs announced by the
automaker.GM wants the Ontario and federal governments to
contribute about $140 million towards a new engine plant in St.
Catharines, Ont., and a new research centre in Oshawa.GM has
received about $250 million in provincial money, and recently announced
layoffs of 1,400 workers in Windsor and about 900 in Oshawa.But
McGuinty says Ontario is still competing with U.S. states to land new
automotive projects and must be prepared to pony up some cash.
Why do governments still think that they can win this game?
Worthwhile Canadian Initiative 
What game is it you think they are playing?
Because the game is not to save jobs but to get re-elected.
The game is “Prisoner’s Dilemma”. If the governments of all prospective plant locations refuse to provide a financial incentive to the corporation looking for a bribe to locate their plant, they will benefit on average. If any capitulate they will lose on average.