A Poor Excuse for Public Discourse

Questions and Answers about Job Creation in Presidential Debate Were Ludicrous

SOURCE: AP/Chris Carlson

Republican presidential candidates, from left, former House Speaker Newt Gingrich, Rep. Michele Bachmann, (R-MN), former Massachusetts Gov. Mitt Romney, Texas Gov. Rick Perry, and Rep. Ron Paul (R-TX) stand together before a Republican presidential candidate debate at the Reagan Library on September 7, 2011, in Simi Valley, California.

By Scott Lilly | September 8, 2011

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Ludicrous! No I am not talking about the rapper. I am talking about the eight politicians who wasted two hours of my time last night arguing over which one had created the most jobs. Even more ludicrous was the national press corps that seemed to think it was a reasonable dialogue.

About 25 years ago I wrote a paper called “The Bi-Coastal Economy.” It pointed out that all of the economic growth that the Reagan White House was bragging about had actually taken place in just 13 states, including California and most of the Eastern Seaboard. The other 37 states which made up the nation’s heartland hadn’t grown for five years. It wasn’t that the governors of states like New York, Massachusetts, Maryland, or California were so much smarter than their brethren in the Dakotas, Ohio, or Texas. It was the fact that the Federal Reserve was trying to drive down inflation by placing a strangle hold on the money supply and driving up the value of the dollar.

That was fine for the banks and the service economy, but devastating for goods producers such as farmers, manufacturers in the Rust Belt, and energy producers in the oil patch. Today we have a Federal Reserve struggling to prevent deflation combined with a concentration of global economic growth overseas that has pushed energy and agricultural commodity prices through the roof.

This is where Texas Gov. Rick Perry’s claims about job creation become ludicrous. The dollar has plummeted against all major currencies and the price of West Texas Intermediate Crude has jumped from $29 a barrel when Perry was sworn in as governor in December of 2000 to $110 this past April. With wheat soaring from a little more than $2 a bushel to more than $7 during the same period and cattle prices up by about 70 percent one wonders why there are still more than a million Texans who are unemployed.

Governors can impact their state’s economic future. They can improve their state’s infrastructure with investments in transportation, water, and sewage treatment. They can strengthen the skills of the workforce with better schools, community colleges, and universities. But as most governors are painfully aware such investments may take the better part of a generation to show real results and almost never bear fruit during the tenure of a governor that initiates them.

What is puzzling about Texas is how little advantage it has taken of the unique opportunities it has had to make such investments. Nearly every state works at exporting their tax burden. Florida takes a hefty bite out of winter vacationers with a stiff tax on hotel rooms. Nevada does very nicely by splitting the losses of out of state gamblers with the state’s casinos.

Texas, with nearly a quarter of the nation’s proven oil reserves, collects a cool 7.5 percent on the market value of natural gas production and 4.6 percent on oil. That means that every time a furnace switches on in Ohio, Michigan, or Minnesota, Texans are able to pay part of the annual salary for a teacher, fireman, or highway patrol officer.

That is why there is little excuse for Texas to rank behind Arkansas, Alabama, and 42 other states in per pupil education expenditures. According to a report released last December by the National Center for Education Statistics, the probability that a high school freshman in Texas will graduate has gone down during Gov. Perry’s tenure while it has gone up for the rest of the country. Texas now has the lowest percentage of citizens over age 25 with a high school degree and the Center for the Advancement of Literacy and Learning at Texas A & M reports that “19 percent of adult Texans can’t read a newspaper.”

For some governors it is a good thing that the results of their efforts are not likely to become apparent during their tenure in office.

Scott Lilly is a Senior Fellow at the Center for American Progress Action Fund.