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Rick Perry Slams California's Business Climate In Ads Airing Across State (VIDEO, UPDATE)

LISTEN: Rick Perry Slams California
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Executive Editor, The WorldPost

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Texas Gov. Rick Perry slams California's business climate in a new radio ad airing this week across the state.

He says in the ad that building a business in California is "next to impossible." And the solution he has for California businesses is clear: "come check out Texas."

Perry says businesses should flee the supposedly not-so-Golden State for the Lone Star State, where there are "low taxes, sensible regulations and [a] fair legal system" (including roadblocks to suing a business when someone is injured or killed). Listen to the ad here.

The ads will air in Los Angeles, San Francisco, Sacramento, the Inland Empire and San Diego. They are paid for by Texas One, "a public-private partnership that markets Texas nationally and internationally as a prime business destination."

This is not the first time Perry has sought to poach businesses from California.

He has made several scouting trips and has written letters to California companies, as have representatives from other states during California's budget crisis, CNN reports. Perry noted that the cost of doing business in California is 6.3 percent above the national average and Texas' is 4.6 percent below it, partially because the state has no state income tax and a low business tax cut.

California Gov. Jerry Brown has shot back. In an interview on Marketplace Morning Report last month, Brown criticized Texas for its relatively large percentage of people working at or below the minimum wage.

Brown also said that he expects California's $96.7-billion general fund to end next year with a surplus thanks to cuts and taxes in his new budget plan.

UPDATE: Gov. Brown, at a business event in Sacramento Tuesday (see video above), said that Gov. Perry's ad is "barely a fart."

"It's not a serious story, guys," he said. "It's not a burp. It's barely a fart."

"A $26,000 radio buy is the smallest entry into the media market of California," he said. "Everybody's coming [to California]. The Brits are here, trying to figure out how to cooperate and be a part of our media, Internet, digital. Look, when you've got something good, people want to be here."

HuffPost received the following response from Gov. Brown's Office of Business and Economic Development on Monday:

“I can understand why Rick Perry is interested in California. We were the national jobs leader for most of the last year with 257,000 new private sector jobs,” said Kish Rajan, director of the Governor’s Office of Business and Economic Development. "But business relocations only account for 0.03 percent of annual job losses in California. At that rate of growth, it would take 20 years to lose just 1 percent of our businesses to relocation. The reports show that no state has ever poached their way to long-term prosperity. Real job creation comes from California’s history as a national leader in start-ups and the expansion of homegrown businesses.”

Poaching doesn’t work. This is something so many governors have done before and with the same ineffective results. One of the only real studies that’s ever been done on this, by the Public Policy Institute of California (PPIC), called it insignificant. During the two years of the highest departures in the study, California lost just 0.05 percent of the state’s total establishments. At that rate, it would take 20 years for California to lose just one percent of its business establishments due to out-of-state relocation.

And if you take a look at the new report from Good Jobs First in Washington D.C., you’ll see how little it actually got our visiting governor. In the first seven years of Perry’s administration, Texas got an annual gain of 0.03 percent in jobs gained from relocation. Even if you double that rate, it would still be an extremely small impact. So basically the report says that Texas officials should spend 99.97 percent of their time and money on everything else but chasing other state’s jobs.

There have been several high-profile company expansions this year including:
1) Samsung, which opened a major research-and-develoment facility in San Jose
2) Sutter, which built a new health care facility in Roseville that will employ over 1000 people
3) Amazon, which announced three distribution centers across the state
4) Caterpillar, which recently opened a 400,000 square-foot distribution center in Kern County to support a resurgent construction market which has grown by 4.4 percent this year.

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Before You Go

10 U.S. States With The Lowest Taxes
10. New Mexico(01 of10)
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Taxes paid by residents as pct. of income: 8.4 percentTotal state and local taxes collected: $16.9 billionPct. of total taxes paid by residents: 59 percentPct. of total taxes paid by non-residents: 41 percentThe state and local tax burden on New Mexico residents is the tenth lowest in the country. The state has a slightly below-average business climate, with a corporate tax rate ranging from 4.8% to 7.6%. Gasoline taxes are quite low, but excise taxes on alcohol and cigarettes are above average. The state tax on beer is one of the highest in the country. A high percentage of state and local revenues come from non-residents. This is usually the case with most states with a low tax burden on its residents. Per capita, state residents pay just $2,027, the sixth-lowest amount in the country.Read more at 24/7 Wall St.
9. Louisiana(02 of10)
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Taxes paid by residents as pct. of income: 8.2 percentTotal state and local taxes collected: $44.2 billionPct. of total taxes paid by residents: 54 percentPct. of total taxes paid by non-residents: 46 percentDespite having the fifth highest average state and local sales tax rate, residents of Louisiana have a relatively low tax burden. A leading reason for this is the simple fact that, on average, residents pay one of the smallest amounts of total state and local taxes in the country. According to the Tax Foundation, property taxes in the state are $565.23 per capita, the fifth lowest amount among states. Louisiana also collects $1.78 in federal spending for every dollar spent on federal taxes -- the fourth highest ratio. This rate of federal spending helps offset the need for higher state revenue from taxes.Read more at 24/7 Wall St.
8. South Carolina(03 of10)
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Taxes paid by residents as pct. of income: 8.1 percentTotal state and local taxes collected: $35.4 billionPct. of total taxes paid by residents: 66 percentPct. of total taxes paid by non-residents: 34 percentResidents of South Carolina pay the second smallest total amount in state and local taxes per person in the country, behind only Mississippi. The average person in the state pays $2,742 in taxes. Excise taxes are extremely low: the state has the fifth lowest gasoline tax in the country and the ninth lowest cigarette tax. The state also has relatively low property taxes at both the state and local level.Read more at 24/7 Wall St.
7. New Hampshire(04 of10)
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Taxes paid by residents as pct. of income: 8 percentTotal state and local taxes collected: $9.6 billionPct. of total taxes paid by residents: 56.4 percentPct. of total taxes paid by non-residents: 43.6 percentNew Hampshire "has no special revenue source from non-residents, but the citizens' approval of limited government spending has kept the tax burden low," according to the Tax Foundation, The state has a flat 5% income tax rate that only applies to dividend and interest income, but, effectively, no tax on wages, and as a result most residents don't have to pay it. The state is also one of only five states that has no sales tax. This causes many people from outside of the state to travel to New Hampshire to purchase goods that are heavily taxed in their own states. Not all taxes in New Hampshire are low, however. The state has the third highest property tax rate in the country.Read more at 24/7 Wall St.
6. Texas(05 of10)
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Taxes paid by residents as pct. of income: 7.9 percentTotal state and local taxes collected: $196.5 billionPct. of total taxes paid by residents: 63.4 percentPct. of total taxes paid by non-residents: 36.6 percentThe population of Texas is 30% larger than New York, but collects more than 60% less in tax revenue than the Empire State. The tax burden on residents is the sixth lowest in the country, at just 7.9% of average income per resident. The biggest reason for this is that the state is one of just six in the country to levy no personal income tax. Texas also has the 11th lowest sales tax, at 7.39%, and average or below average rates on gasoline, cigarettes and alcohol.Read more at 24/7 Wall St.
5. Wyoming(06 of10)
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Taxes paid by residents as pct. of income: 7.8 percentTotal state and local taxes collected: $9.3 billionPct. of total taxes paid by residents: 29.9 percentPct. of total taxes paid by non-residents: 70.1 percentBesides Alaska, Wyoming has the greatest percentage of its state revenue paid for by non-residents. This is because of taxes on oil and coal that bring money in from out-of-state oil and mineral companies. These taxes account for such a large percentage of Wyoming's revenue that the state does without a corporate income tax. The state also has no individual income taxes. Wyoming has an average state and local sales tax rate of 5.38%, one of the lowest in the country.Read more at 24/7 Wall St.
4. Tennessee(07 of10)
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Taxes paid by residents as pct. of income: 7.6 percentTotal state and local taxes collected: $48 billionPct. of total taxes paid by residents: 63.7 percentPct. of total taxes paid by non-residents: 36.3 percentTennessee has the eleventh lowest per capita income in the country. Residents of the state pay just $1,851 in taxes, the second lowest amount in the U.S. The state's business climate is average, but other taxes are relatively low. The sales tax of 7% is one of the highest in the country, but food purchases are only taxed 5.5%. Dividend and interest income is taxed in the state at a rate of 6%, but there is no other personal income tax levied. Tennessee collects no state-level property tax, one of just a few to do so.Read more at 24/7 Wall St.
3. South Dakota(08 of10)
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Taxes paid by residents as pct. of income: 7.6 percentTotal state and local taxes collected: $5.2 billionPct. of total taxes paid by residents: 56 percentPct. of total taxes paid by non-residents: 44 percentSince 1977, South Dakota's tax burden has dropped from 9.1% to 7.6%, causing the state to change from the 15th least burdened state to the third least burdened. The state has no corporate or individual income tax. It is easier for South Dakota to keep a low tax burden than many other states, however. According to the most recent data available from the Tax Foundation, South Dakota receives $1.53 back for every dollar collected in federal taxes, lessening the state's dependence on state and local revenue.Read more at 24/7 Wall St.
2. Nevada(09 of10)
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Taxes paid by residents as pct. of income: 7.5 percentTotal state and local taxes collected: $20 billionPct. of total taxes paid by residents: 52.5 percentPct. of total taxes paid by non-residents: 47.5 percentNevada has the second-lowest tax burden in the country, with residents paying just 7.5% of their income on state and local taxes. Nearly half of all state tax revenue comes from non-residents. According to the Tax Association's State Business Tax Climate Index, Nevada has one of the most favorable environments for business, as it is one of the four states to levy no corporate tax at all. A significant amount of the state's revenue comes from "sin taxes" on gambling, alcohol, and tobacco, most of which comes from tourists. Sales tax is above the national average, and the tax on gasoline is one of the highest in the country. Counties are also allowed to levy additional gas taxes on top of the state.Read more at 24/7 Wall St.
1. Alaska(10 of10)
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Taxes paid by residents as pct. of income: 6.3 percentTotal state and local taxes collected: $18.8 billionPct. of total taxes paid by residents: 20.5 percentPct. of total taxes paid by non-residents: 79.5 percentAlaskans have the lowest tax burden of any state in the country, paying just 6.3% of their income in state and local taxes. This is over one full percentage point lower than the state with the second smallest tax burden. According to the Tax Foundation, "Before the Trans-Alaska pipeline was finished in 1977, taxpayers in Alaska bore the second-highest tax burden in the country. By 1980, with oil tax revenue pouring in, Alaska repealed its personal income tax and started sending out checks instead. The tax burden plummeted, and now Alaskans are the least taxed." The state also levies no personal income tax or sales tax.Read more at 24/7 Wall St.
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