Hoeven: North Dakota Is Prosperous Because Of Government Spending

Governor John Hoeven has an op/ed in the Bismarck Tribune today defending North Dakota’s out-of-control higher education spending in the face of criticism launched by Dr. Richard Vedder and the North Dakota Policy Council. In the op/ed Hoeven attribute’s North Dakota’s recent prosperity not to a booming oil industry or the stable and strong coal industry or even the bumper crops the state’s ag industry has enjoyed over the last several years but rather on the massive amount of spending on higher education and “economic development” in this state.
An excerpt:

Richard Vedder’s recent letter criticizing our support for higher education in North Dakota is more than a little ironic. As the nation struggles through a severe national recession, most North Dakotans continue to work and raise their standard of living. They do so, in large measure, because of our state’s aggressive economic development efforts in recent years, many of which link our universities with the private sector.

Hoeven goes on to claim that we’ve cut taxes in North Dakota, but in reality these “tax cuts” are little more than an accounting trick. The governor and the legislator have engaged in more state-level spending at the local level in the hope that this spending would allow local taxing entities to roll back their property taxes. Of course, a lot of North Dakotans ended up paying more in property taxes anyway as local taxing entities jacked up home valuations. So even as property tax rates have perhaps stopped growing, because home valuations have skyrocketed (by government estimates, naturally) North Dakotans are paying more.
That’s hardly tax relief.
As for “aggressive economic development efforts in recent years,” let’s look around at some of those economic development projects. Right here in my home town companies lured here by this much-hyped “economic development” spending have been dropping like flies. Sykes. Z-tel. Websmart. And now rumor is that travel reservation booking call center MLT may be leaving town as well. In other places in the state companies like Alien Technology in Fargo, Imation in Wahpeton and Bobcat in Bismarck have closed down operations or moved operations despite tens of millions of dollars in investment from the taxpayers.
And higher education spending? That’s hardly been a boon for the state. North Dakota taxpayers spend more subsidizing the education of students who don’t even live in the state, and aren’t likely to stay once they get their degrees, than they spend on educating actual North Dakotans. And given the rampant abuses of funding in the higher education system (see: the NDSU President’s mansion scandal), it’s clear that we’re spending too much money on higher education.
One has to wonder what version of reality Governor Hoeven is living in where the gigantic increases state spending he’s presided over have had a greater impact on our economy than oil, coal and prosperous farming years.
Perhaps the same version of reality President Barack Obama, who remains convinced that his “stimulus” spending is, in fact, creating jobs, is living in.