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Right Turn
Posted at 01:45 PM ET, 08/23/2011

Club for Growth gives Perry mixed reviews

Club for Growth, one of the most outspoken pro-free market groups, is out with a white paper review of the record of Texas Gov. Rick Perry. While generally favorable, there is plenty for critics to point to.

The group, for example, praises him for having “shepherded large tax cuts through the legislature as Lieutenant Governor. He signed into law a large tax cut in 2006, and he pushed for changes in the Texas Constitution that would further restrain the government’s ability to charge higher taxes.” But then it dings him for three large “blemishes” on his record: 1) a 1987 vote while in the state legislature for “the largest state tax increase in American history – a $5.7 billion tax hike”; 2) his first budget in which he raised “millions of dollars in ‘revenue adjustments, surcharges, and fees,’ including new fees on nurses, crematoriums, home builders, and alcohol licenses for a grand total of at least $2.68 billion in new revenues over two years. It is true that increased fees are not the same as broad-based tax increases, but they are anti-growth and serve the same purpose of funding government”; and 3) a property tax overhaul that included an “anti-growth ‘gross receipts tax,’ or a tax on gross revenues of Texas companies, which at the same time eliminated the corporate income tax. The new taxes ‘nearly tripled the amount that Texas collected from businesses.’”

The Club for Growth gives him thumbs up on spending for “fiscally conservative tendencies and a commitment to reducing the size of government that are in tune with the conservative nature of a state like Texas.” Nevertheless, the group is very critical when it comes to some expensive spending schemes :

On the bad side, however, Perry has also aggressively used government spending to attract jobs to Texas. During his time in office, Perry has signed into law two major economic development initiatives, the Texas Enterprise Fund and the Texas Emerging Technology Fund. . . .
These gimmicky subsidies are a form of corporate welfare, and they’re similar in effect to the tax credits decried by Perry in his 2010 book. This suggests that Governor Perry is more pro-business than he is pro-free markets.
Writing in his book, “Fed Up!,” well after their passage, Perry was highly critical of President Obama’s stimulus bill, President Bush’s 2008 mini-stimulus, TARP, and the bailouts of the auto industry, AIG and Fannie Mae and Freddie Mac. But in the same breath, Perry indicated that he probably would have supported the massive expansion of government into the economy that occurred under President Bush because Bush’s vision for them was that “they should be temporary.”

Perry gets the highest marks on tort reform. “Pro-growth conservatives looking for a champion on the issue of tort reform will be hard pressed to find a candidate with a better record than Governor Perry. Perry has long been a strong supporter of tort reform, and has been a major factor in turning around the state’s reputation as a haven for tort abuse.”

But in general the Club for Growth evidences some significant skepticism about how much Perry really did in Texas and how equipped he will be to take on liberal opponents in D.C.:

The Texas tax and regulatory climate Governor Rick Perry inherited from Governor George W. Bush was already among the best in the nation. Further, during Perry’s entire long tenure as governor, the Texas Legislature has had conservative Republican majorities. So the bar for judging Perry’s performance should be set high.
It is quite clear that Perry did not move his state in reverse, or on the wrong course. In many instances, he merely maintained a positive status quo. In others, such as tort reform and regulations, he improved the Texas economic climate.
Still, his support for taxpayer-subsidized funds to lure jobs away from other states shows he has at times an interventionist streak rather than consistent free-market principles. His semi-apology for the big government interventions of President Bush suggests a similar inclination.
Should Rick Perry become President, he will inherent a far worse economic climate than he has in Texas, as well as a less hospitable Congress than he has in the Texas Legislature. It is quite likely that Perry would seek to move the country in a much more pro-growth direction. Almost any movement in the direction of the Texas approach would be welcomed. However, given some actions in his record, it is questionable whether Perry will maintain his steadfast fiscal approach when faced with a less favorably inclined legislature than he is accustomed to.

Well, it will be up to Perry’s opponents to show that their own records are superior to his and/or to question his wherewithal to deal with more vigorous liberal opposition than he found in Texas. That said, it is a bit surprising for the governor touted as such a hard-line conservative to receive such a mediocre review from a premier group of fiscal conservatives. Perhaps, he needs to do a better job making the case for his own record.

By  |  01:45 PM ET, 08/23/2011

Categories:  2012 campaign

 
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