Texas Remains a Strong Economic Model, Perry Says

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AUSTIN – Texas will remain a safe bet for business and investment because of the policies the state has put in place since a catastrophic downturn in oil prices in the mid-1980s, former Gov. Rick Perry told The Bond Buyer's Texas Public Finance Conference Wednesday.

"Don't bet against Texas," Perry said in his speech to close the event, which examined the role of falling energy prices on Texas debt issuers.

"I think we have a track record of the last 14 or 15 years that should give you a very good feeling that Texas is a place you want to do business, where people want to live here and raise a family," Perry said.

Perry said the "Texas Model" developed during his 14 years in office is still emulated and is based on more than just abundant energy resources.

"I'm bullish on Texas because of the diversity of our economy," he said. "Texas will continue to lead because of the policies we have put in place."

While private industry has prospered, Perry said that government leaders continue to operate under the restraints of austerity.

"The philosophy is deep in these agencies now," he said.

Perry recalled the economic devastation that hit Texas in the 1980s with severe damage to the banking and housing industries.

"I know what a turndown's all about," he said. "When oil went from $30 to $8, we were broke for a long time. And that's not where we find ourselves today."

To cope with the 1986 collapse of the oil market, Texas had to impose "the largest tax increase in free world," Perry recalled.

Perry, Texas' longest serving governor at 14 years, left office in January 2015 with a farewell address to the state legislature, where he began his career as a Democratic state representative. He switched parties in 1989.

"I came here in 1985 as a 34-year old state rep and meant to stay a few years and do my public service and go back to Haskell County," Perry said Wednesday. "Don't think that life doesn't have some interesting twists for you."

As lieutenant governor, Perry took over the term of his predecessor George W. Bush in 2000 when Bush mounted his successful campaign for president.

Perry also ran for president twice, but both attempts ended in failure. In the 2016 campaign Perry was the first Republican candidate to drop out of the crowded field after a poor showing in the first debate.

"I could be traipsing around New Hampshire now," Perry joked. "What's that old adage? If you want to hear God laugh, tell him your plans."

Perry returned to the campaign trail on behalf of Texas Sen. Ted Cruz ahead of the Iowa caucuses, which Cruz won ahead of Donald Trump.

Perry's own campaign was hampered by a felony indictment in Austin for his attempts to force the resignation of Travis County District Attorney Rosemary Lehmberg after her conviction on charges of driving while intoxicated. During the 2013 legislative session, Perry openly threatened to line-item veto $7.5 million of state funding for the Travis County Public Integrity Unit unless Lehmberg resigned. When she refused to do so, Perry vetoed the funding.

In August, 2014, Perry was indicted and is awaiting trial on a charge of abuse of official capacity.

During his tenure, Perry was an effective recruiter for businesses seeking to relocate to Texas. He played a key role in landing Space-X's launch facility on the southern tip of Texas, bringing Toyota's United States headquarters to Plano and attracting a Caterpillar assembly plant, among others.

As a champion of highway expansion, Perry led the greatest expansion of highway debt in the state's history. The state's public finance authority sold $2 billion in bonds for unemployment benefits.

"People are still moving here because we have that very diverse economy," Perry said, "When you have that many people move into your state, you better have the infrastructure in place.

In 2003, Perry signed legislation that created the Texas Enterprise Fund, which has since given $435 million in grants to businesses. The New York Times reported that many of the companies receiving grants, or their chief executives, had made contributions to Perry's campaigns or to the Republican Governors Association.

Through most of his tenure, Perry a massive project known as the Trans-Texas Corridor to carry high speed traffic and provide rail and utility lines from the Mexican border all the way to Oklahoma. After widespread opposition from landowners in the path of the project, the Texas Transportation Commission declared the project dead.

"I still have skid marks on my back from the Trans Texas Corridor," Perry said Wednesday.

However, some segments, such as State Highway 130 that bypasses Austin in parallel with Interstate 35, did come through.

Although he's no longer at the helm, Perry expressed confidence in the leaders who came up through the ranks during his tenure, including his successor, Greg Abbott.

"The only thing that could change the course would be for Texas to elect a lot of big spenders in 2018," Perry said.  "I think I can tell you that's not going to happen."

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