Hutchison: Perry can't take credit for the economy
Wed September 16, 2009 11:47 pm

From the Hutchison daily e-mail:

Hutchison also has taken issue with Perry taking credit for Texas’ ability to weather the economic storm that has depleted other states’ coffers.

Hutchison admitted that Texas is doing better than other states in the slow economy.

“The reason we are doing better is that we are a right-to-work state, and we don’t have a state income tax, and Gov. Perry had nothing to do with that,” Hutchison said when asked why voters should change leadership in Austin if Texas is doing better than other states.

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I’m on Perry’s side this time. He clearly has made economic growth a central focus of his governorship. Do we want the Toyota plant in Texas? You bet. The Caterpillar plant? Of course. A lot of the luster came off the Enterprise Fund and the Emerging Technology Fund as a result of Perry’s wheeling and dealing with A&M, and some of the recipient companies may not be able to reach their job targets, but on the whole there is more plus than minus here.

In taking on Perry on the issue of the state’s fiscal health, I think Hutchison is running into a brick wall. How do you make the case when the numbers are on Perry’s side? Who thought this was a winning argument? It doesn’t matter that the policies that have Texas in a relatively good fiscal position did not start with Rick Perry. They go back fifty years, to the era of the conservative Democrats, whose mantra was a “good ‘bidness’ climate.” The good business climate meant low taxes, minimal services, and favorable regulation for business. Nothing has changed. State budget writers have always been cautious about spending money, allocating well over 90% of the available revenue to education, health care, and law enforcement. It starts with the Legislative Budget Board, whose budget is always “bare bones.” But Perry has involved himself in keeping budgets lean as well, by having executive agencies reduce their spending requests.

It’s possible that some of Perry’s policies may come back to haunt him. The property tax cut of 2006 has created a structural deficit in the budget. The 2011 legislative session will have to deal with this. His opposition to raising the gasoline tax (and insistence on toll roads) have delayed road construction that could be years ahead of where we are now. His refusal to take the unemployment insurance funds will raise taxes on Texas businesses and make it more difficult for them to create new jobs. None of this changes the fact that today, as the Republican primary looms, the state’s finances are better than almost every other state’s.

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