Governor Perry’s decision to fund the opening of a new Charles Schwab office in El Paso (and another in Austin) is a classic example of what is wrong with the governor’s economic development funds. Charles Schwab is a national firm that needs no subsidy from the state to succeed. The issue with these grants ought to be whether the firm getting state funds needs the money to be successful. In the case of Schwab, the answer is clearly no.

The money is going to a local office that represents but a pittance of the business that Schwab does. Why does Schwab require a subsidy? The governor’s office says that Schwab is also expanding in Austin. The test in these cases ought to be whether the beneficiary of the grant needs the money to be successful. To put it another way, would Schwab be expanding in Austin and El Paso without an Enterprise Fund grant? Or is this another case of Perry doing favors for his friends?