Perry’s personal stimulus program

Rick Perry took a break from railing against federal spending to announce putting $4.5 million from the Emerging Technology Fund into a company (Convergen LifeSciences Inc.) headed by David Nance.  As the Austin-American Statesman pointed out, this had been an issue in the 2010 gubernatorial campaign because Nance was a Perry contributor.

This subsidy is especially troubling for those of us at state universities who recently received word that we would have to identify an additional 2.5% in savings (on top of the 5% we were told about last summer) from the current budget year (we’ve been told to expect a 10-20% reduction in next year’s budget). These latest cuts are especially difficult since the state’s leaders waited until the spring semester was already set and few places remain to make cut without eliminating course offerings for students. Difficult cuts will also have to be made in prisons and other state agencies. Most of the faculty and state employees I’ve talked with accept that these cuts are needed in tough economic times. Still, we wish that the state’s leaders had not waited so late to let us know.

What makes the Governor’s announcement ironic is that he continues to run his own stimulus program out of his office while attacking federal stimulus programs. I have already written about how Perry’s office has used the Emerging Technology Fund, Texas Film Commission, and other programs to subsidize everything from the Super Bowl to video game production. Now that we’re seeing state employees laid off and college classes cancelled, the jobs allegedly created by these subsidies to already profitable endeavors looks even more questionable.

Government officials often talk about “economic development” without considering the degree to which these programs violate  free market principles or whether or not they create as many jobs as we hope. How much do we want government involved in running Texas businesses and what should we do to keep these millions becoming the newest form of patronage?

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