(Texas Gov. Rick Perry went to Illinois to entice businesses to move to Texas.)
As he proved in the 2012 Presidential debates, Rick Perry has a hard time following a thought to its logical conclusion. He could remember the first two federal departments he wanted to kill but not the third. He can warn his “fellow Texans” about the fiscal and moral damage that would be caused by the federal intrusion of increased Medicaid funding but ignore the $100 billion in federal funding over a decade that Texas might lose as a consequence. His two-day junket this week to Chicago to lure corporate headquarters away from the Land of Lincoln is long on promises but short on the consequences of past corporate enticements.
With the backing of Texas taxpayer money, conveniently supplied by the Texas Legislature, Rick Perry is hollerin’ Sooey Pig to the Hog Butcher of the World in order to see which little piggies come running. He was, after all, yell leader for the Texas Aggies when in college—that’s a male cheerleader to you, proving his college education did prepare him for his current role. An ad in Crain’s Chicago Business, headlined, “Get Out While There’s Still Time,” contained an open letter from Perry, which read, “If you’re a business owner in Illinois, I want to express my admiration for your ability to survive in an environment that…is designed for failure.”
|His two-day junket this week to Chicago to lure corporate headquarters away from the Land of Lincoln is long on promises but short on the consequences of past corporate enticements.|
What’s he got in his bag of tricks? The promise of low taxes for corporations, no state taxes on personal income, subsidies for large corporate relocations—even if it brings in oversized competition for home-grown industries—and little or no regulation. Why, you can locate a fertilizer mixer in the middle of town, and no one will make you do much more than self-report every now and then.
The promises may be music to certain corporate chieftains looking for a quick fix for the next five or 10 years, hoping to duck an explosive state pension system and high personal income taxes. In These Times predicted that Perry (and Gov. Scott Walker of Wisconsin before him) wouldn’t lure anyone to pull up stakes but would enable local industries to squeeze a few more tax breaks out of state and local governments in Illinois.
The consequences of throwing around these shiny bangles are like the morning after you find yourself dressed only in beads after losing your shirt at Mardi Gras. As Good Jobs First, a national information source on government and corporate accountability, points out in its “Primer” for journalists covering Perry’s trip to Illinois, taxpayer money spent by Perry in the first seven years of the Texas Enterprise Fund produced a tiny 0.03 percent increase in jobs from corporate migrations. Most of the Texas job growth has been in lower-wage sectors, mostly in the service economy to serve the surging population growth coming both from a relatively high birth rate and immigration from other countries, predominantly Mexico. Many more people migrated to Texas following high-wage job promises than the number of high-wage jobs produced. Local job seekers found themselves facing sudden stiff competition from across the nation. Those waiters in hip new Austin eateries included PhDs from California and Kansas, as well as those that were home-grown.
Many of the high tech firms locating in and around Austin may appreciate the incentives but most cite the synergy of co-location with other such enterprises, the level of education of the potential employee base, the large local markets, and the research capacity of the faculty and students of the University of Texas. Here again, Perry disregards the end-game. Those very low taxes he touts are also sucking dry the University of Texas and other public colleges and universities that helped generate the tech boom in the first place.
There are other factors problematic about these swashbuckling campaigns. Good Jobs First points out that a large number of these corporations also provided sizable campaign contributions for Perry’s gubernatorial and presidential campaigns. It must have been understood as a show of gratitude or part of the price of admission—crony capitalism at work.
Perry can’t even get cancer research right. He runs a fund set up for that purpose by the legislature, which has become a trough at which friends, supporters and pseudo-researchers have dined; it’s being investigated.
|Taxpayer money spent by Perry in the first seven years of the Texas Enterprise Fund produced a tiny 0.03 percent increase in jobs from corporate migrations.|
So let’s say he draws a few corporations to Texas. The boards of those corporations fly in for board meetings, eat some barbecue and enchiladas and fly away. They probably like the fact that they’ve moved from the state with the fourth-highest hourly minimum wage to a state tied with Mississippi for the highest percentage of workers earning the absolute minimum rate.
The top executives move into gated communities, attend fundraisers with former football stars and Matthew McConaughy, send their kids to private schools, and oppose increases in property taxes for public schools. Maybe they don’t care about how their employees live or their employees’ employees.
Texas’ impressive rankings among states do not stop with the amount it spends on business tax incentives. Texas is also first in executions, first in the percentage of the people lacking health insurance, and first in five major categories of air pollution.
Unlike the cherished UT Longhorns, who have fallen to the middle of the football pack, Texas holds onto its top ranking for the percentage of people 25 and older who do not have a high school diploma, for the number of non-elderly women not covered by health insurance, for the percentage of women not receiving prenatal care. Texas also boasts the lowest spending per capita on mental health.
These, too, are part of Perry’s Texas Miracle.
Just as Rick Perry’s once proud mane is growing thin, so are his arguments for Texas prosperity. Even some of his old Republican colleagues are having a hard time getting in line to lose $100 billion in Medicaid funding just so Perry can embellish his apparently undying Tea Party-inspired presidential aspirations.
As he asks the immortal question, “Will it play in Peoria?” his act is having a more difficult time entertaining even the Lone Star State.
Geoff Rips, a former editor of the Texas Observer, is a Special Correspondent for The Washington Spectator.
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