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Right Turn
Posted at 11:03 AM ET, 08/18/2011

Perry’s job model

Liberals and other critics of Texas Gov. Rick Perry have tried to undermine his record of job creation in Texas. However, as statistical gurus have pointed out, his record there is hard to quibble with. This compilation of data at Political Math is the most compelling. There are several takeaways: 1.) Jobs are “growing over twice as fast as the second-fastest state and three times as fast as the third”; 2.) It is likely that “people are moving to Texas looking for jobs rather than moving to Texas for a job they already have lined up. This would explain why Texas is adding jobs faster than any other state but still has a relatively high unemployment rate”; 3.) The “Texas median hourly wage is $15.14... almost exactly in the middle of the pack (28th out of 51 regions). Given that they’ve seen exceptional job growth (and these other states have not) this does not seem exceptionally low.” 4.) It is more than just oil revenue that is fueling the boom since we know that if we “take the energy sector completely out of the equation and Texas is still growing faster than any other state.” And: 5.) It’s not a matter of public-sector job growth since the “Texas public sector has shrunk by 26,000 jobs. In the last 12 months, Texas lost 31,300 federal employees, trimmed 3,800 state jobs, and increased local government jobs by 8,400 jobs.”

However, this less-than-compelling attack on Texas job creation obscures a more legitimate concern: Just what is Perry’s model for economic growth?

Tim Carney of the Washington Examiner makes the case that it is corporate cronyism run amok:

“I’m a pro-business governor — I don’t make any apologies about it,” Rick Perry told the crowds in Iowa this week. He’s right, but we can get more specific. Perry is pro-Merck, pro-Boeing, pro-Mesa Wind, pro-Texas Instruments, pro-Convergen, and pro-dozens of businesses that donate to his campaigns and hire his aides as lobbyists.
Perry promises to “get Americans back to work,” but his policies — from backroom drug company giveaways to green-energy subsidies — eerily mirror the unseemly big business-big government collusion that has characterized President Obama’s presidency. Judging by his record in Texas, Perrynomics might just be low-tax Obamanomics.

Is this accurate? Carney points to “the Texas Enterprise Fund, giving the governor, lieutenant governor and House speaker the power to hand out multimillion-dollar grants to businesses seeking to relocate to or expand within the state” and the “Texas Emerging Technology Fund, using taxpayer money to invest in high-tech companies.” Carney writes that reports that demonstrated “a strong correlation between Perry’s biggest campaign contributors and the money handled by these funds and Perry’s other public-private partnership.”

The Austin Statesman reported on some of these public-private deals. This one is noteworthy:

As part of a job-creation fund meant to spur innovation and research at universities and in the private sector, the state invested $4.5 million in Convergen LifeSciences Inc. to develop a cancer-fighting drug using nanotechnology. One of the company’s founders is David Nance, a Perry contributor and Austin biotech executive.
The founders had invested only $1,000 of their own money when they asked the state for $4.5 million, the Statesman reported in June . Convergen’s 2009 application touted Nance as a biotechnology leader without mentioning the bankruptcy of Introgen Therapeutics Inc., where he was a founder and CEO. Introgen failed in 2008 after the Food and Drug Administration denied its application to market a cancer therapy.
A regional review board initially turned down Convergen’s application for state money. Alan Kirchhoff, then Perry’s economic development chief, intervened on Nance’s behalf, and a statewide review board recommended approval.

There is a divide between being helpful to big business and promoting conservative market-based proposals. Taken to the national level this sort of public-private “cooperation” inevitably leads to giant bureaucracies, politicization of business decisions, and a playing field tipped heavily in favor of those big and rich enough to gain political access. The bailout mentality that sparked the rise of the Tea Party in its essence is founded on the cozy ties between big business and big government. It’s frankly not what most Tea Partyers think of as a “conservative” approach to governance.

The debate between pro-business and pro-free-market policies is an important one, and may come to the fore in the Republican primary. Yesterday Perry’s campaign chief strategist David Carney launched this attack against Mitt Romney: “I don’t think the country is looking for somebody to be a buyout specialist.” That’s the sort of thing you’d expect from a different Carney — Jay Carney, the president’s spokesman. (None of these Carneys are related so far as I know.) And it is an odd tactic for Perry in a Republican primary in which voters tend to support the idea that success and failure in the private sector are essential for growth and prosperity.

The downfall of the Republican majority in Congress in 2006 was the perception that conservatives had gone to Washington and become ensnared by lobbyists, donors and special interests who used the federal government and taxpayers’ money as a piggy bank. Republicans should examine candidates’ records and see not only if they have successfully created jobs but how they have done so, what the appropriate model is for the relationship between government and the private sector and whether that model is one we should adopt in Washington.

By  |  11:03 AM ET, 08/18/2011

Categories:  2012 campaign

 
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