Who gets what from the Governor?

Bloomberg has a story (“Perry’s Friends in Texas Discover Donations Dovetail With State Contracts“) that looks at how Perry donors have been rewarded. These stories have been rattling around for a while and they are certainly not going away now.

While Perry has criticized the federal government’s stimulus program, the irony is that Perry run a kind of on-going stimulus program that attempts to create jobs by giving state dollars to a wide array of businesses. One of the questions I raised in a previous post about this involves the degree to which we violate free market principles (George Will has also raised the issue). It may be “pro business” to give money to companies to encourage them to create jobs. It is not classic free enterprise to have business turning to government rather than investors for money.

An important aspect of this issue that we have avoided in Texas politics is who hands out this money. Under Rick Perry we have kept a lot of these funds under the direct or indirect control of the governor’s office. The problem is that there are two possible reasons for Perry’s donors getting money:

  1. It’s natural that business owners who share the Governor’s vision of the Texas economy would give money to his campaign.
  2. They gave Perry money to help get state money.

It would be impossible for Perry to demonstrate that he did not favor donors. How do you prove a negative? Similarly, it would be almost impossible for critics to prove that Perry was engaged in “pay to play.” (Unless someone was dumb enough to write down an agreement to trade a donation for a state contract.) So, Texans will remain suspicious of the amount of money going to our governors’ political allies.

These programs need reform. We have added a great deal of power to the governor’s office over the last decade without pausing to install a few safeguards. There is no reason for so many of these funds to be so closely tied to the office of a single political office and Texas runs the risk of creating a privatized patronage system where donors get state grants (rather than government jobs) in return for supporting their party.

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