The more I ponder Gov. Rick Perry’s costly partisan job-piracy raids, the more contradictory and wasteful they seem. If preying upon states with supposedly bad “business climates” is his mission, he might want to rethink his travel itinerary. (His office says there will be more trips.)
In case you missed them, last week we issued a report and a blog exploring the public taxpayer dollars and the private corporate dollars behind the state-sponsored non-profit group paying for Texas Gov. Rick Perry’s job-piracy trips—and big-budget TV and radio advertising campaign—to six states, all led by governors of the opposite political party. He himself framed them as “a good red state blue state conversation.”
So far, Gov. Perry’s response to our findings about the taxpayer money has been evasive: his spokesperson has simply repeated the misleading disclaimer “no state money,” even though we exposed the fact that there are oodles of local Texas taxpayer dollars flowing to the entity that funds his trips and advertising.
His discredited disclaimer aside, as we review his six trips, they look even more wasteful. Take his Missouri trip in August, for example: Perry used $100,000 in radio ads and a high-profile speech to support the cause of Missouri lowering its corporate income tax. Specifically, he urged an audience of Missouri legislators and business leaders to override a veto by Gov. Jay Nixon of a corporate tax-cut bill. But if Perry believes that lower taxes help a state attract jobs (he relentlessly cites the fact that Texas has no income tax), shouldn’t he have urged Missourians to hike their corporate taxes? Wouldn’t lower Missouri taxes make it harder for him to pirate jobs to Texas?
Regular Clawback readers know that we don’t accept Perry’s premise that tax breaks are effective in site location; they rarely can matter because they are too small a cost factor; see more here. But holding Perry to his own rhetoric contradicts his Show Me State venture.
Contradictions aside, Gov. Perry’s trips are officially about policy one-upmanship, about preying upon states that are allegedly vulnerable because they have inferior “business climates.” There are several states that supposedly have poor business climates that the Governor seems to be ignoring: the Tax Foundation, among other conservative groups, ranks some poorly (though there are good reasons to be highly skeptical of their methodologies, see our study here).
Such rankings beg the question: why isn’t Gov. Perry also pirating states like New Jersey and Iowa? The Tax Foundation rates New Jersey #49 on its State Business Tax Climate Index (and three other conservative groups all rate New Jersey between #43 and #49, a lower average score than any of the six states he has pirated). The Garden State is a target-rich environment packed with high-paid jobs.
The Tax Foundation also rates Iowa low, at #42. Perry has traveled to Iowa, presumably because it has the first presidential caucus. Is that why he hasn’t criticized its business climate? Or is it because the Hawkeye State (like New Jersey) has a governor of the same political party? How about Wisconsin, rated the 43rd worst business climate by the Tax Foundation?
Another rational tack would be geography: we know from studies done in other states that adjoining states are often prominent sources of in-migrating companies. That would suggest Perry should stage trips to New Mexico, Louisiana and Oklahoma. As well, Florida shows up high on an in-bound list from the Austin Chamber of Commerce.
As my writings over two decades make clear: I don’t wish job piracy upon any state; it is objectively an ineffective strategy that can waste huge sums of taxpayer dollars. But if coaxing more jobs to Texas is his true goal, then all of these states are logical targets for Gov. Perry. Unless, of course, his choices are simply partisan, to avoid offending governors of his own political party.
We’ll be watching to see where Gov. Perry goes next.