Governors as Heroic Champions of the Economy

Ed Gillespie. Photo credit: Associated Press

Writing in the Richmond Times-Dispatch today, Bart Hinkle takes Republican gubernatorial candidate Ed Gillespie to task for asserting that he’s going to shape a “dynamic economy that creates jobs” in contrast to the anemic economy under the tutelage of Democrat Terry McAuliffe. As Hinkle correctly observes, a governor’s actions have a limited impact on a state’s economy. Gillespie’s claims are as empty as those of McAuliffe, who takes credit for having overseen the creation of thousands of jobs during his administration.

When the federal government accounts for 30 percent of the state’s GDP, there is nothing that a governor of any partisan or ideological stripe can accomplish in three or four years to offset cuts to the defense, intelligence and homeland security sectors. As for the corporate-investment deals announced by the Virginia Economic Development Partnership, to which every Virginia governor since time immemorial has attached himself, rare has been the instance in which a governor’s involvement proved decisive.

What governors can do is promote public policy that creates a more favorable business climate. Gillespie has some good ideas on that score — modernize the outdated tax code, repeal outdated regulations, and foster entrepreneurship and small business formation. But let’s be realistic. A case can be made that reforming the tax code could give a modest boost to Virginia economic growth, but Virginia’s tax code is business friendly already and any gains would be incremental. As for the repealing-outdated-regulations trope, every governor campaigns against red tape. But very few have the stomach for tackling the regulations backed by powerful constituencies that truly do stifle job creation, such as occupational licensing and the Certificate of Public Need.

As McAuliffe has said repeatedly, and as I have emphasized on this blog, tens of thousands of jobs are going unfilled in Virginia because companies cannot find employees with the skills to fill them. The job of equipping Virginians with  the requisite skills falls to the public sector, both K-12 schools and higher education. If a governor truly wants to be known as a “jobs” governor, he will it make his No. 1 priority to make government get better at its core mission of educating and training its citizens.

Government can do other important things, such as enabling the evolution of the built environment toward more cost-efficient human settlement patterns and creating a transportation system to serve it. To my mind, this would entail a market-driven shift to an Uber-flavored “smart growth” future. As in so many areas, the biggest obstacle is outdated regulations, particularly zoning codes. I blogged about that topic for years, but I despair that it is too esoteric for most of the voting population to understand, which means that it’s too esoteric for elected officials to care about.

In any case, overhauling K-12, higher ed, transportation and land use cannot be accomplished in a single gubernatorial term. It is the project of a generation, which means it requires a broad social consensus. We need to abandon the idea of governors (or presidents) as heroic champions who can single-handedly revive ailing economies. They can’t. They need to concentrate on what they can do.

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7 responses to “Governors as Heroic Champions of the Economy”

  1. “The biggest obstacle is outdated regulations, particularly zoning codes . . . I despair that it is too esoteric for most of the voting population to understand.”

    Perhaps “most” don’t get it, but enough do that the word gets around. And how else can public policy be influenced but by starting with a select group of influential people first — particularly those who write about the policy you want to influence?

    I wish there were a better way to highlight the pervasive influence of building and zoning codes on how we live and work. They are at the heart of so much local government bureaucracy run amok. They drive sprawl, and consequently transportation, energy and education infrastructure. Yet they are administered by some of the least-enlightened, most CYA-oriented people I have ever met.

  2. LarrytheG Avatar

    What should Gillespie be telling the people of economically distressed parts of Virginia that he will do to help them?

    Would he tell them the truth?

    What should he tell the parents of kids in failing schools?

    will he guarantee them enrollment in a choice school or instead make fatuous claims about the wonderfulness of choices schools for those than can afford to attend with state “help”?

    what will Gillespie promise to do about non-college workforce training?

  3. Until we go back to serious education and discipline in the classrooms, you can forget it.

  4. TooManyTaxes Avatar

    Having been a “regulatory attorney” for 40 years, I can appreciate the need for government regulations. Even in a free market, there are some bad guys who will cheat and lie to make money. And some companies have market power.

    But many regulations exist to protect someone from competition or remain in effect when the market or technology has changed. Also, some regulations direct subsidies to some business operators.

    Turning to land use regulations. Many tend to be quite flexible giving a developer or building owner considerable latitude to make economically sound decisions with their property. The problem comes when someone wants to push costs on his neighbors or change the character of a neighborhood.

  5. djrippert Avatar

    Virginia’s one term governor is a lame duck the day he or she is inaugurated. Heroic champions of the economy? More like footstools of the Imperial Clown Show.

  6. Steve Haner Avatar
    Steve Haner

    Agreed campaign boilerplate is just that. But as a general rule, no Big Thing happens around the Capitol unless the governor either proposes it or embraces it as a signature issue, and most governors count themselves successful if they can get one or two done in their single term. Don’t sell short what a strong governor with a good idea could accomplish for the state’s economy. Godwin and the community colleges, Baliles and McDonnell on transportation, Allen on parole and welfare reform. A governor could end up a footstool, but it is possible to be ringmaster.

  7. LarrytheG Avatar

    I think transportation got fixed under McAuliffe. McDonnell did revamp the gas tax but then he created the US 460 mess but HB2/Smart Scale (2014) has totally changed the transportation game in Virginia.

    and you forgot Gilmore – TMT’s favorite, not mine, I think the property tax rebate idea is an abomination a ticking fiscal time bomb that barfed all over the budget.

    and I’m no fan of Allen’s accomplishments…. we basically doubled our prison population and primarily for “possession” type drug offenses..popular politically but questionable as a strategy for drugs and exploding prison costs to say nothing about what happens after you release these folks and expect them to go get jobs with their felony convictions. No they could not get welfare but their wives and kids did.

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