When asked what conversations he has had with legislators since he vetoed a bill that would have given tax credits to companies that make sofas, chairs and other furniture in Mississippi, Gov. Haley Barbour said, “I think the people recognize the truth and validity of the veto message.”
In the last several weeks, Barbour has vetoed two bills to come across his desk dealing with economic development.
The first, dealing with eminent domain, was eventually sustained by the Mississippi Senate by a narrow margin.
The second, dealing with tax credits for furniture makers, is unlikely to be overridden, particularly since any attempt would have to begin in the Senate where Barbour has much more support than the House.
Despite these latest events, Barbour, in an interview with the Mississippi Business Journal, said he believes the Legislature has good intentions and that together will make good economic decisions for the state.
“If I’m not publicly out front about legislation, then I don’t generally substitute my judgment for the Legislature’s judgment,” Barbour said. “I’ve signed many a bill in here that I probably wouldn’t have voted for if I had been a legislator, but in this case I have been very straight forward from the beginning. We don’t have any extra money.”
Barbour pointed to the fact that the state has cut spending by $200 million, and was due to cut another $100-plus million, until federal stimulus dollars were received by the state.
“We’re going to be making cuts next year and the following year,” he said. “And, I have been very plain to everybody. We don’t have the extra money to do these kinds of things.”
Mississippi, which has had furniture manufacturing plants since 1947, has almost 20,000 workers in the industry. However, it has been hit particularly hard by the recent recession. The state lost 24.7 percent of its furniture jobs between 2000 and 2007 as some companies moved portions of their operations overseas and others closed because of tough economic conditions.
Despite that, Barbour believes there is a better way to help the furniture industry, but he is mindful that there are a lot of industries hurting in Mississippi, saying that bailing out all is not financially feasible.
“We’ve got a lot of industries that come to us and say, ‘Please help us so we don’t have to lay off people; so we don’t go out of business,’” Barbour said. “I thought is was not fair, good policy or affordable for us to do this just for the furniture manufacturers.”
However, there have been other instances when the state has intervened to help companies in tough times.
“Usually when we give companies a tax advantage, it is because they are bringing in new jobs or protecting jobs,” Barbour said. ”Yet in this particular legislation, there is no requirement for the companies to keep the jobs.”
In previous years, Barbour and the state have helped Cooper Tire in Tupelo and Baxter Labs in Cleveland with tax incentives.
“But in doing so, they agreed that if we did that for them, they would keep these jobs.”
In the case of eminent domain, Barbour says job creation and job development are for the public benefit and that sometimes there is a need to “use the power of the state appropriately to try to help it along.”
He also points out these situations are not unique to Mississippi.
“When we recruit a Toyota or a PACCAR or Severstal, it’s a competition,” Barbour said. “And in everyone of those situations, we are competing against Tennessee or Arkansas or Alabama.
“When people stepped back and thought about the big picture of using of the public policy, we’re not going to vote against tax preferences; we’re not going to vote against putting in water or sewer; we’re not against any of these uses of public power for the use of job creation.”
Having said that, though, Barbour was careful to point out that much care should be taken with any eminent domain case.
“What we have to make sure of is that the power of eminent domain is used very strictly, very prudently and totally appropriately,” Barbour said. “The good news is you can do that without eliminating eminent domain in terms of job creation.”
In both the case of the bill dealing with eminent domain and the bill dealing with tax incentives, the governor stopped short of saying the Legislature was overzealous, but he does believe they could have been more prudent.
“I think (the Legislature) was very well intentioned,” Barbour said. “I just think there was a better way to deal with both bills. And, sometimes you learn there are a lot of good ideas that you simply can’t afford.
“We can’t do every good thing; we can’t have every good program, and it’s because we aren’t willing to subject the taxpayers to that much taxation. It would not be good policy in the end.”
With one veto win under his belt and another win likely on the horizon, Barbour’s vision of good policy is what will win out for Mississippi.
Contact MBJ managing editor Ross Reily at email@example.com.