Desperately trying to find a legitimate Republican Presidential candidate, many in the media have latched on to Governor Rick Perry and his alleged “Texas Miracle.” This purported miracle revolves around the fact that since 2009, 37% of all new jobs in the US were created in Texas. Conservatives seize on this number to claim that job growth in Texas has resulted from various right wing policies, such as tort reform, a lack of an income tax, and weak regulations.
The conservative myth about a Texas miracle suffers from a number of flaws. For example, there are a number of blue states, such as Massachusetts and New York, that have lower unemployment rates than Texas. Also, the low tax low regulation approach in Texas has serious drawbacks. As Harold Meyerson at the Washington Post explained in a recent post, Texas:
has the fourth-highest poverty rate of any state. It tied with Mississippi last year for the highest percentage of workers in minimum-wage jobs. It ranks first in adults without high school diplomas. Twenty-six percent of Texans have no health insurance — the highest percentage of medically uninsured residents of any state. It leads the nation in the percentage of children who lack medical insurance. Texas has an inordinate number of employers who provide no insurance to their workers, partly because insurance rates are high, thanks to an absence of regulations.
And, perhaps most significantly, the conservative myth about Texas ignores the critical role that progressive economic and regulatory policies had in generating the job growth that Rick Perry takes credit for. In particular, the job growth in Texas can be largely attributed to four progressive policies:
1.Stringent Real Estate Mortgage Regulations – Texas was not as hard hit by the Bush Recession as other states in large part because stringent regulations on cash-out refinancing and other risky real estate lending helped prevent the type of collapse of the real estate market that occurred throughout most of the rest of the country.
2. Government Jobs – Contrary to Gov. Perry’s small government rhetoric, Texas has seen a substantial increase in government jobs. In fact, from December 2007 to June 2011, private sector employment in Texas has declined 0.6%, while public sector employment has increased 6.4%. Between 2007 and 2010, Texas lost 178,000 private sector jobs, but gained 125,000 public sector jobs.
3. Federal Stimulus – Gov. Perry is a vocal critic of federal stimulus spending, even starting a “No Government Bailouts” petition. At the same time, Perry requested $6.4 billion in federal stimulus money to cover 97% of Texas’ budget deficit in fiscal year 2010. This stimulus money enabled Perry to avoid the kind of job-killing budget cut backs that so many other states engaged in.
4. Immigration - While today’s conservatives rail against immigration, the large amount of immigration to Texas has played a key role in the job growth that Gov. Perry brags about.
In short, progressive policies on regulation, government spending, and immigration have played a key role in spurring the one positive feature about Texas’ economy – high job growth. If Gov. Perry were an honest broker, he would be praising those progressive policies and be using his campaign to try to protect consumers in the real estate mortgage market, use government spending to create jobs, and support an immigration system that enables more people to become naturalized citizens here in the US. Unfortunately, Gov. Perry is not an honest broker and, therefore, he instead has flirted with the idea of Texas seceding from the US, and has written a book declaring Social Security and many other government programs unconstitutional. Plainly, Rick Perry has taken the wrong lesson from his years as Governor of Texas.