It's time for us to cut back on government and help the American people. -- Mitt Romney
Chief Executive Magazine annually surveys CEOs about the best and worst American states for doing business. America's CEOs consider: Texas, Florida, North Carolina, Tennessee and Indiana the Five Best for Business States (BfB); and Michigan, Massachusetts, Illinois, New York and California the Five Worst for Business States (WfB). The survey's rankings have been stable over long periods. Massachusetts, for example, has been known as a high tax, heavily-regulated state for at least the last forty years.
According to the survey, America's BfB have what America's CEOs want -- smaller government, low taxes and business-friendly regulations. The BfB clearly have lower taxes and smaller government with an average per capita state tax of $1,843, compared to the WfB at $2,520. So, let's examine whether smaller government is better for Americans.
CEOs, paradoxically, prefer to live and work in the high tax, heavily-regulated WfB. Of the Fortune 500 companies, 165 are headquartered in the WfB, while only about 100 are headquartered in the BfB. Among America's 50 fastest growing corporations, about twice as many have headquarters in the WfB, as in the BfB. Even CEO Romney selected Massachusetts (ranked 47th on the survey) for Bain Capital's headquarters, and it's where he's lived (on and off) for the last 30ish years.
The State Human Development Index ranks American states on well-being and opportunity for their residents (rank 1 is best). On this Index, the WfB are better places to live (average rank 13) compared to the BfB (average rank 36). Metrics such as: household income, life expectancy, infant mortality, and educational opportunity demonstrate that the BfB -- are worse for people.
WfB median household incomes are much higher ($57,000 in the WfB vs. $47,000 in the BfB). Further, people live longer and have lower infant mortality rates in the WfB, compared to the BfB. The WfB average rank (rank 1 is best) is 14 for life expectancy and 15 for infant mortality, while comparable BfB ranks are respectively 31 and 36. In highway fatalities, WfB are safer (average rank 8) compared to BfB (average rank 31).
In higher education, the WfB (as a percent of their college-age population) graduate 50 percent more students with advanced degrees than the BfB. Also, the WfB have 23 of our nation's top universities, compared to the BfB's four.
No wonder CEOs choose to live, and establish growth companies in, the so-called Worst for Business states.
Mitt Romney's shibboleth that shrinking government helps the American people -- isn't based on any rational analysis of costs and benefits. Government isn't a parasite destroying the American economy. Government is the provider of public goods (infrastructure, education, police, safety standards, etc.) that the private sector can't or won't provide. If citizens select lower taxes, smaller government and less regulation, they'll get: less infrastructure, fewer police, teachers and inspectors, resulting in worse outcomes.
This isn't a universal defense of every government employee or program. Nor am I claiming that bigger government is always better government. Government programs should be evaluated, and terminated (or restructured), if they aren't efficiently serving taxpayer needs.
Throughout my career (in the Bloomberg administration, at the World Economic Forum and its Davos conferences, and at McKinsey), I've had the honor of working with some of the world's leading CEOs, venture capitalists and entrepreneurs (such as, my co-judges for NYCBigApps).
I found these business leaders incredibly talented at what they did. However, business expertise conveyed no automatic insights on public policy.
My old boss, NYC Mayor Michael R. Bloomberg (who made a highly successful transition from private to public sector), emphasized that the public sector must make investments the private sector won't risk making. Consider President Obama's successful public sector rescue of the auto industry vs. the private sector approach, which would have left millions more unemployed.
Another smart public sector investment is Applied Sciences NYC (Mayor Bloomberg's plan to bring a major new engineering campus to NYC). The mayor's team did all the work to develop Applied Sciences NYC, but won't reap any tangible benefits -- the benefits are for future generations of New Yorkers. But that's what the public sector must do, to benefit the governed: make major, long-term investments in education, infrastructure, health and other public services.
CEO Romney's actions, in selecting Massachusetts as his base, suggest he understands the importance of government in making America a better place. But, Politician Romney's statements suggest otherwise.
Which Romney are we supposed to evaluate for president?
Disclosure: As the Bloomberg administration's head of policy and strategy for economic development, I was an architect of Applied Sciences NYC.
I invite you to follow me on twitter at: @Steven_Strauss or on Facebook at: https://www.facebook.com/Steven.Strauss.Updates.
About the Author: Steven Strauss was founding Managing Director of the Center for Economic Transformation at the New York City Economic Development Corporation (NYCEDC). He is an Advanced Leadership Fellow at Harvard University for 2012. He has a Ph.D. in Management from Yale University and over 20 years' private sector work experience. You can follow him on twitter at: @Steven_Strauss or on Facebook at: https://www.facebook.com/Steven.Strauss.Updates.
Follow Steven Strauss on Twitter: www.twitter.com/steven_strauss
"Five Reasons the Super Rich Need Big Government"
http://www.counterpunch.org/2012/07/16/five-reasons-the-super-rich-need-big-government/
How can that be good for anyone?
- all one has to do is stop the public unions from siphoning public funds!
CEOs like to live places like Boston and New York because those cities are still living off the glory of their better days. For the established wealthy, they're very nice places to live. However, give it another 50 years and I strongly suspect that most of the WfB states will look like Michigan where nobody wants to live, while the BfB states will be the new hubs
One should also realize that the flip side of being a WfB state is that it’s a great state for people who have to go to work for a living. As opposed to a Mitt Romney who collects dividends checks by the pool while he is “unemployed”? Of course you can do that in BfB states as well. There is nothing stopping you.
The problem with solutions arrived at by all of these "advanced" degree holders is they fail to think outside the box, therefore their solutions also fail to solve anything. We don't have a "jobs" problem in the US. We have an economic system problem. The promise of the 50's and 60's was that technology and science would replace what we currently know as a "job" by the turn of the century. IOW's, machines would be doing most of the "heavy lifting" that used to require multiple human intervention, thereby allowing the entire population more leisure time and/or more time to devote to using science and technology to solve bigger problems than simply survival. That promise has come to pass as far as the machines are concerned. Unfortunately, the job = survival mentality remains. Instead of rewarding citizens with survival/security for the value of the contributions they make to the country as a whole, our so called leaders continue to try to solve the survival issue with the job = money = survival system of the soon to be distant past. Let's first start by recognizing that the "job = money = survival" system of the past will not be returning. Ever. It's the "reward" system that needs to be replaced to provide a path to prosperity for US citizens. Not creating more jobs ...
Do you like highways and police protection and firefighters and insurance on your bank account and clean water and safe food, etc., etc.? That is all government.
http://www.governmentisgood.com
When you scream about wanting to be free of government, think about Somalia. That country's residents have had very little government to 'burden' them. What do Somali's say?
"I am from Somalia and to live without government is the most dangerous system."
Abdow, Vingaker, Sweden
"'I just want a government, any government will do,' one man told me."
http://news.bbc.co.uk/2/hi/4017147.stm
There is this myth that the American people have had some debate over the roll of government. . . and government lost.
In fact, there has been no recent, meaningful national debate about the proper of government. Instead, there was simply a corporate sponsored PR campaign to demonize government, and most people simply bought it like any other product on the shelves, and they now jump to the conclusion with no intervening logic. That government is bad is now very literally an article of faith -- a fervently held religious belief.
Worse, most journalists no longer question the conclusion, which means any politician is allowed to denigrate and criticize government without any need whatsoever to defend their criticism with logical argument or fully contextualized facts.
The only thing separating Americans from living in poverty and despair has been the historical brilliance of our government.
Great government made this nation great.
all of them and if you don't care for todays version not to worry.
the next rendition is making it's way through team romney as we post.