Perry, a former Republican presidential aspirant up for reelection next year, spent about $24,000 to air radio spots around the state promoting Texas’s sunny business climate. “Building a business is tough, but I hear building a business in California is next to impossible,” Perry intoned. “Low taxes, sensible regulations, and a fair legal system are just the thing to get your business moving to Texas.” That modest ad buy returned 100 times as much in free publicity, thanks, in large part, to Governor Brown. “You take a little radio ad and all you guys run like lap dogs to report it. [The ad] is not a burp. It’s barely a fart,” Brown said, to the delight of newspaper editorial writers, television news anchors, and ten-year-old boys from San Diego to Humboldt.
A wind is blowing, all right. When the Texas governor flew back to Austin after a four-day visit to the Golden State, he had no list of commitments from companies looking to relocate tucked away in his jacket pocket. He didn’t need one: companies seem to be moving without Perry’s encouragement.
By now, the case against California’s economic climate is well known. At 9.8 percent, the state’s unemployment rate remains the third highest in the United States, a stubborn two percentage points above the national average (Texas’s 6.1 percent unemployment is nearly two percentage points lower). After November’s election, thanks to the passage of Proposition 30, California now boasts the highest personal-income and state sales taxes in the nation. California’s corporate income tax is the highest in the western United States. Even with Proposition 13, California’s property tax is the 15th-highest in the country. Decades of compounding rules and regulations—health and safety, environmental, labor and workplace—have made the Golden State the least hospitable place to do business in America, according to survey after survey. “Some time in the past, California became uncompetitive with other states because of their tax [and] regulatory policies in particular,” Perry told the San Jose Mercury News editorial board last week. “Twelve years ago, California wasn’t looking over its shoulder,” he said. “They’re not looking over their shoulder now—they’re looking at our backside.”