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August 16, 2011

New York Times: Pretty Much Perry Just Got Lucky With Job Creation Or Something

Obama: Bad luck.

Perry: Just good luck.

Is Texas lucky, or has the state benefited from exceptional leadership? As Gov. Rick Perry campaigned Monday in Iowa for the Republican presidential nomination — with the economy dominating the national political landscape — the answer to that question is central to his candidacy.


But some economists as well as Perry skeptics suggest that Mr. Perry stumbled into the Texas miracle. They say that the governor has essentially put Texas on autopilot for 11 years, and it was the state’s oil and gas boom — not his political leadership — that kept the state afloat. They also doubt that the Texas model, regardless of Mr. Perry’s role in shaping it, could be effectively applied to the nation’s far more complex economic problems.

“Because the Texas economy has been prosperous during his tenure as governor, he has not had to make the draconian choices that one would have to make in the White House,” said Bryan W. Brown, chairman of the Rice University economics department and a critic of Mr. Perry’s economic record.

Datum: Perry didn't face the economic crisis Obama created for himself.

And if Mr. Perry were to win the nomination, he would face critics, among them Democrats, who have long complained that the state’s economic health came at a steep price: a long-term hollowing out of its prospects because of deep cuts to education spending, low rates of investment in research and development,and a disparity in the job market that confines many blacks and Hispanics to minimum-wage jobs without health insurance.

Um... isn't the black unemployment rate under Obama like 20%?

Datum: Texas has lots of jobs now, but somehow this will translate to a "long-term" reduction in jobs "prospects" because of a lack of "investment." Meanwhile, by implication, Obama's America has lost millions of jobs but we're ready for that "investment" driven comeback any day now.

Okay, so, so far, we have 1, racism, and 2, it's just luck and stuff.

Not very strong, at least so far.

Incidentally, Rick Perry just emailed me to call Obama a "sinister Count Chocula looking motherfucker."

Oh, and by the way, how are those investments in green jobs workin' out, Chockey?

Is it all you hoped it could be, and still more?

Update: The Economist partly rebuts many of the liberal attempts to spin away the "Texas Miracle," concluding the glib dismissals are off-base.

I would suggest that in the rush to debunk Mr Perry, Democrats are being a little hasty. The Perry campaign is giving the startling statistic that since June 2009, 40% of the net new jobs created in America have been in Texas—a state with less than 10% of the nation's people. The Dallas Fed, earlier this month, reckoned that Texas created 261,700 jobs between June 2009 and June 2011, compared to 524,000 in the nation as a whole. Given the tremendous need for jobs in this country—and grinding unemployment is a horrible thing, not a minor inconvenience—it's a little disheartening to think that people are rushing to dismiss what has happened in Texas just because it's Texas and because Mr Perry, with his accent and his swagger, is the state's governor. So let's put politics aside. Pretend that Mr Perry doesn't exist, and that there's been a dummy stuffed with straw sitting in his office this whole time. What would have happened in Texas?

As Mr Krugman and others have noted, oil prices have helped buoy the economy.... According to Karr Ingram, an economist with the Texas Petroleum Institute, the Texas oil and gas industry added more than 28,600 jobs since June 2010, or about 13% of the state's net jobs in that span. It would also be fair to say that the oil and gas industry has impacts on Texas that are not captured in the traditional indicators. For example, Texas's longtime energy leadership has helped spur its interest in wind power, an industry where it now leads the nation. It may be counterintuitive, but there's a sense among state politicians that if Texas has the institutional expertise to do energy, that should extend to renewables, too. In any case, we can see that oil and gas are important to Texas job creation, but hardly the whole story.

One more stupid claim Krugman makes is that Texas benefited from "regulation."

What regulation? This -- that when the rest of the country was following the Frank Plan for giving mortgages to those who didn't deserve them, Texas bucked the trend, and their banks continued with tight mortgage requirements.

So, um, Texas didn't follow the federal liberal stupidity on mortgage issuance and as a result did not have a catastrophe in the housing market, and this proves he's stupid or benefited from "regulation."

Bear in mind, the Frank agenda consisted of using leverage and political threat to force banks to loosen requirements -- i.e., the mortgage disaster was due to "regulation" -- government intervention in normal business practices not to increase stability and reduce risk, but to increase risk, to achieve a social-policy result-- not due to too little of it. Banks, left to their own devices, had long required sizable downpayments and proof of income, for obvious reasons.

So, fail again.

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posted by Ace at 06:55 PM

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