ANALYSIS: Job creation job No. 1 in Missouri, but how?

Sunday, December 12, 2010 | 5:44 p.m. CST

JEFFERSON CITY — Creating jobs. Everyone at the Missouri Capitol says they want to do it. But how, exactly, would they do so?

With the Jan. 5 start of the legislative session fast approaching, it's becoming apparent that Democratic Gov. Jay Nixon and the Republican leaders of the Missouri House and Senate may have different ideas for accomplishing what they all insist is their No. 1 goal.

For Nixon, creating jobs generally has meant providing state aid to specific businesses so that they can expand their facilities in Missouri and hire additional employees. He wants to revamp Missouri's wide-ranging system of tax credits — eliminating some programs, merging others and giving his Department of Economic Development greater flexibility to tailor incentives to particular projects, even offering cash up front in some cases.

For Republican legislative leaders, creating jobs means providing a general pro-business environment that encourages companies to expand in Missouri and hire employees. They want to reduce taxes for businesses both big and small, limit union powers and rewrite Missouri laws on discrimination, whistleblower and injured worker claims to shield businesses from potential legal costs.

Certainly, Republicans also have embraced tax breaks for specific businesses, and Nixon also wants to make Missouri a generally attractive place to do business. But they appear to be coming at the task from somewhat different perspectives.

In the past eight months, Nixon has held two dozen media events at businesses around the state to announce state aid for expansions and to participate in ceremonial groundbreakings and ribbon cuttings. The cumulative totals of Nixon's announcements: more than $95 million of state incentives that he projects will lead to 3,541 new jobs.

Nothing, it seems, is too small for Nixon to show up. On Nov. 29, for example, Nixon took the state plane to Macon and St. Joseph to announce that fishing equipment manufacturer Ardent Outdoors would be adding eight employees, Van Am Tool an additional 12 employees and Sunshine Electronic Display an additional 25 jobs as a result of plant expansions getting state aid.

Nixon used a sports analogy to describe his economic development efforts, comparing each seemingly small job announcement to a football team gradually moving the ball downfield with short running plays.

"A lot of this job is three yards and a cloud of dust right now — it's producing, it's creating jobs one, 10, 20, 100 at a time, upping the number of students we've got in community colleges and four-year schools, getting workers trained," Nixon said.

The governor praised a recent report from his Tax Credit Review Commission, which suggested Missouri should replace several separate business incentives with a new, unified program giving his administration a rich menu of options when preparing an incentive package that can be targeted to specific businesses.

House speaker designee Rep. Steven Tilley, R-Perryville, said lawmakers would review the report with due diligence, but his preliminary assessment was cool, at best.

"They've used false data and incorrect conclusions to come up with the recommendations," Tilley said.

Nixon was likewise unenthusiastic about two of the job-creation ideas being considered by Republican legislative leaders — a cap on the amount of franchise tax paid by businesses and a 50 percent deduction for business income applied to corporate or individual state income taxes. With a budget shortfall estimated by his administration between $500 million and $700 million for next fiscal year, the state can ill afford to forgo too much more revenue, he said.

"We'll certainly be willing to look at anything that folks have, but these budgets aren't made any easier by moving that line that way," Nixon said.

The governor was more firm in his opposition to one of the favorite proposals of Sen. Rob Mayer, R-Dexter, the likely next Senate president pro tem. Mayer wants to make Missouri a "right to work" state in which union dues could not be a condition of employment. He contends manufacturers are reluctant to locate or expand in Missouri because of the current potential for union shops.

Nixon, who has received large political contributions from unions, noted Missouri voters rejected a "right to work" ballot measure in 1978.

"In 32 years since Missouri voters spoke on this, I've not really seen a significant amount of objective data to indicate that changing that law would help us create jobs here in Missouri," Nixon said.

With the governor and lawmakers starting from different assumptions, compromise may be a necessary reality. But they can at least agree on similar rhetoric as they try to address a Missouri unemployment rate that has remained above 9 percent for more than a year and a half.

"Missourians have told us they want a better, more favorable business climate to create more jobs here in Missouri," Mayer said.

Added Tilley: "Clearly the most pressing issue is putting people back to work."

Said Nixon: "We will continue to talk about jobs and economic development."


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Jeremy Calton December 12, 2010 | 9:08 p.m.

Why must we even attempt to pretend such things could possibly ever follow any kind of logical economic principles or exist to serve the public interest?

Any "solution" will involve sweetheart deals for the legislators' biggest lobbyists or their specific industries. It's not a mystery how politics work: find (or create), report, and exploit fear and uncertainty for profit and power.

(Report Comment)
Nelson Richter December 13, 2010 | 7:42 a.m.

The next proposal from the majority will be to give businesses the right to employ 16 year olds giving them a waiver from school! Profits, profits, profits and rewards to lobbyists are the only things that these "legislators" care about; the future for Missourians is bleak!

(Report Comment)
Ellis Smith December 13, 2010 | 8:29 a.m.

An important consideration to keep in mind is that no program or programs, even if successful, are apt to show rapid results. Over time a successful program might be very helpful, but these matters require time. Of course that's an anathema to politicians, who all want "instant" results.

Another important consideration is the need to match supply with demand. People are usually hired to do a specific job. "Jobs" is a non-specific term.

"No one has yet found a way to repeal the Law of
Supply and Demand." - Ronald Reagan (1972)

(Report Comment)
frank christian December 13, 2010 | 10:53 a.m.

"A lot of this job is three yards and a cloud of dust"

I've always wondered about this analogy, in football or anywhere else. Do "three yards and a cloud of dust" three times and then you have to punt,don't you?

(Report Comment)

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