In today’s AAS Laylan Copelin has a great article, Is state jobs program luring employers?, which sheds light on Lt. Gov. David Dewhursts plan that gives money to businesses to hire unemployed Texans. The idea is for the state to give businesses, that wasn’t planning on hiring new employees, a $2,000 incentive to hire new employees. But in many cases it’s just allowing business to, in essence, scam the tax payers out of $2,000 for hiring employees they would have hired, with or without, the incentive. And Dewhurst, in an election year, is going around the state trumpeting this as a success.
Lt. Gov. David Dewhurst is crisscrossing the state to promote his plan that pays employers with state tax dollars to hire unemployed Texans.
He touts it as a way for the state to save money by getting people off unemployment and jump-starting a Texas economy that many fear could be in a long, slow recovery.
“We’ve got to grow this locomotive called the Texas economy,” Dewhurst said in February as he kicked off the $15 million program. He already is talking about extending the nascent program during next year’s legislative session, and the Texas Workforce Commission is trying to persuade federal officials to give it $50 million in stimulus money to triple the program’s size.
The program pays employers $2,000 for each unemployed person they hire and retain for at least four months. As of Friday, 682 Texans had been hired by 421 employers statewide. In many instances, however, employers say the state is paying them to do what they would be doing anyway: filling crucial vacancies, expanding only when business conditions warrant or, in the case of high-turnover industries such as call centers, filling their constant roster of openings.
“No one has said that to me,” said Dewhurst, who has made a half-dozen appearances with employers around the state promoting the program. “They’ve all said they wouldn’t have hired the employees without the program.”
“If they are going to hire a person anyway,” Dewhurst said, “I don’t think their application (for the money) fits.”
Well now you’ve been told. It’s doubtful he’ll do anything to stop this though. But businesses sure like the free money.
Robert Funk, who manages two call centers for Aegis Communications in Irving, appeared with Dewhurst at a recent Dallas event promoting the program. He said he expects to hire 2,000 employees this year.
The jobs won’t be new. His business isn’t expanding. The call centers are hiring in an industry in which annual turnover runs 100 to 150 percent, Funk said.
The program, however, is changing whom Funk hires. In the past, he said, he typically hired younger workers who were switching jobs. By hiring the unemployed, Funk said, he is getting an older — and he hopes a more reliable — work force.
“I like that we get some money back for hiring folks,” Funk said. [Emphasis added].
Wow!! Can you imagine the outrage from the right if that was a needy person being quoted as saying something like that? It appears free tax payer money to businesses, for doing something they were going to do anyway, and not inline with what the money was meant for, is OK with Dewhurst. This is another case of a so-called conservative looking the other way when businesses scam tax payer money. Apparently this is how this kind of incentive program usually works.
Bernard Weinstein, an economist at the Cox School of Business at Southern Methodist University, agrees.
“In the great scheme of things, it doesn’t make much difference,” he said.
Weinstein, who has studied similar subsidy programs in other states, said he doesn’t have much faith in them. “Government usually ends up subsidizing what companies would do anyway,” he said.
As the article goes on to quote more right wing Republicans, from them even, it seems the final outcome is murky at best. While the program may end up, possibly, providing some benefit when it’s all said and done, no one is sure.
What should make everyone take note is not that this program was tried, or that it is not living up to what it was billed as. But the reaction of Dewhurst when challenged on it’s effectiveness. It’s his callous disregard for the possible wasting of taxpayer money when it comes to business incentives – he just doesn’t care. But several years back, he threatened to hold up the expansion of the the Children’s Health Insurance Program (CHIP) because of the what he perceived to be a potential for fraud.
Lt. Gov. David Dewhurst contended that keeping the six-month reapplication period was needed in order to avoid fraud, and that qualified families are responsible enough to meet all paperwork requirements.
For Dewhurst when it’s a needy person trying to get health care for their child, fraud is bad. In the case of a businesses getting tax payer money it doesn’t deserve, meh, it’s only money.
Luckily there is a great alternative on the ballot in November, Linda Chavez-Thompson.