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Politics

Florida is Growing Jobs, but Many Come as an Investment

December 14, 2012 - 6:00pm

Job numbers are growing, public debt is under control and Gov. Rick Scott is making sure the government -- his administration -- can claim the credit.

Since December 2010, unemployment in Florida has dropped faster than all other states, thanks to robust partnerships between government and businesses, according to the governor.

During the past year, Enterprise Florida and its economic development partners excelled in creating and retaining jobs for Florida families, Scott wrote in a news release.

He credits Enterprise Florida, the states economic development agency, for its part in helping job growth in the Sunshine State, steering tax credits and public investment opportunities to the right industries.

These outcomes are crucial to helping us recruit more businesses to the state and higher-wage jobs for Floridians, Gray Swoope, Enterprise Florida's CEO, said in the same release.

But while the state government talks up its close ties to business interests, critics point to the overall effectiveness of these programs, and if the taxpayers are really getting their moneys worth when public dollars begin flowing into select companies.

"The truth is, youve got to pay to play, said Chris Barry, spokesman for Florida TaxWatch, a nonprofit taxpayer accountability group based in Tallahassee. He told Florida Watchdog that economic development giveaways by state and local governments have become a part of the game.

Youve got to be very judicious in what youre giving out. A healthy dose of caution is very much in order, said Barry. But done right, wisely, and consistent with values of actual assets, locations, and talented work force, itll work.

He said Florida has been more disciplined than other states in regard to investing public money in private firms.

Nowadays, its an unfortunate necessity, but weve got a real great team in Florida. These kinds of deals have existed since before Scott, and theyll continue afterward, he added.

On the other hand, Dean Stansel, professor of economics at Florida Gulf Coast University, said politicians shouldnt even contemplate playing venture capitalist with taxpayer dollars.

By targeting selected industries or businesses, politicians assume that they know better what the economy needs than do individual entrepreneurs with their own money at risk, said Stansel. Unfortunately, politicians spending other peoples money are uniquely unqualified to play the role of venture capitalist, and they have a dismal track record at doing so.

He points to a 2010 analysis from Gulf Coast Business Review, which reviews eight biotech projects across Florida that have received nearly $1.6 billion in taxpayer subsidies going back to 2004.

Together, these firms employ about 1,143 workers. But that means the state spent about $1.4 million per job. Not exactly a bargain, said Stansel.

Stansel recognizes certain job growth may have occurred with the help of Enterprise Florida, but cautions it may not be as rosy as it seems.

Its easy to identify specific jobs that are created by economic development ventures, he told Florida Watchdog. Its much harder to identify the specific jobs that are not created because of the economic distortions created by those ventures and by the taxes needed to fund that corporate welfare.

Contact Ya Ossowski, Watchdog.orgs Florida Bureau Chief, at Yael@Watchdog.org

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