Rejection Of Federal Dollars Leads To Highest Job Growth In The Nation

I know statistics can be manipulated to show just about anything.  But this really is a pretty amazing coincidence.

Buried deep in an article about polling data supporting a GOP takeover of the House, Rasmussen gets into details that may surprise pundits as to how citizens feel about their state getting federal handouts with strings attached.  You see, a politician’s success used to be measured by the pork brought home.  It seems, however, that Texans have a different opinion on the matter.

“… a plurality of Texas voters backed Texas Gov. Rick Perry’s recent decision to turn down federal dollars a program because federal strings were attached to it.”

We’ll assume that because the Texas governor “decided” to turn down the federal dollars that the U.S. government didn’t send the money anyway, forcing the state to spend money that it didn’t want to.  Which means that Texas’ decision to reject the stimulus money that had strings attached to it was granted.

If that’s the case, then this is very interesting.  The rejection of the money doesn’t seem to have hurt the state that much.  In fact …

More than half of the net new jobs in the U.S. during the past 12 months were created in the Lone Star State.

What I don’t understand is how some liberal economists in academia, in the media and in government can look at data like this, which unequivocally shows that economic activity in Texas is much better than in states where governors and senators beg for money for federal money, thinking that more stimulus money is all that’s needed to resuscitate their economy.

Clearly there seems to be no correlation, and perhaps even an inverse correlation, between federal largesse with strings attached and economic activity.  In other words, it’s not availability of money that is causing the economic bottleneck.  Access to the federal trough appears to be an indicator of weak economic activity.

Realize that correlation does not necessarily mean causation.  It could be that Texas was able to reject the federal money because the state’s economy was relatively strong.  The states that were weak, like California, accepted the federal money because they felt they had to.  In this case, Texas’ rejection of the federal dollars was merely a confirming indicator of the state’s strong economy. But if that’s the case, then you have to wonder why was Texas in so much better shape that they could reject the money while California had to go begging.

— uo

Published in: on October 18, 2010 at 9:14 am  Leave a Comment  

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