Hello John,
Governor Doug Ducey fielded wide-ranging questions on a variety of topics in the latest Washington Examiner magazine cover story. Economic recovery, keeping taxes low and shrinking government – the Governor touched on these and other important issues.
Check out excerpts from the story below and read the full article HERE.
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A Free-Market Oasis In The Desert
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Brad Polumbo
Washington Examiner
April 21, 2022
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Arizona’s Economic Recovery
Washington Examiner: Economic analysis has shown that Arizona is one of 10 states that has now recovered all the jobs lost since the pandemic downturn. What do you credit for that turnaround and success?
Governor Ducey: Well, first, I want to say we were booming before the pandemic. In my first year, I came into office, and we had a billion-dollar deficit and a sluggish economy. So, the first thing we did was make difficult decisions and tighten our belts. And we actually shrank the size of our government in terms of spending, which very rarely happens at any level in government.
We focused on economic development. I ran on kick-starting an economy. I came from the private sector, Cold Stone Creamery was my business. So, from 2015 until 2020, our economy was growing. We were bringing successful economic development wins to Arizona.
I said in my second State of the State [speech] that I’d be remiss if I didn’t thank Arizona’s partner in growing our economy — and that was then-California Gov. Jerry Brown. We just have seen an exodus of people and producers from the state of California that have been coming into our state.
[We were also] getting wins, like [big investments in Arizona from] Lucid Motors, Intel, Taiwan Semiconductor, Nikola, TuSimple, etc. Those types of businesses … time after time, chose Arizona.
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Shrinking Government
Examiner: Can you talk about the steps you’ve taken to shrink the government itself?
Governor Ducey: So, that’s part of what I ran on. I had built a business, [next] I wanted to shrink a government and grow an economy.
I think the government, almost everywhere you look, is bloated and unaccountable. So, we’ve worked very hard to get our arms around this government to make sure that we’ve got a mission in place for each of our agencies, metrics that they can measure themselves against, and transparency around the money.
I didn’t, of course, want to fire anyone, especially [without] cause. But, through our diligence during the campaign, we learned that 24% of the state’s workforce was eligible for retirement in that first four years. So, just by putting a hiring freeze [in place], through attrition, we were able to shrink the size of [the state] government. [We did that while] we added people to the Department of Public Safety and added people to Children’s Services and the social safety net.
Where we actually made up for too many people working inside government is through technology, and by reducing the size of the bureaucracy and the administrative state.
The good news is that there are 400,000 additional jobs since we started in 2015. So, anybody that’s left the government and actually wants to find a higher-paying job can do that in the private sector. So, our government is smaller, more effective, and more efficient.
But the [population] is larger, and the economy is even larger still. So, [we have] lots of opportunities for folks. They’re not trapped in a job, and finally, they have some leverage on wages. That’s because the economy is growing, and it’s such a competitive environment.
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Keeping Taxes Low
Washington Examiner: Last year, you signed into law the biggest income tax cut in Arizona history. Do you think that has factored into your economic success? And would you have done that regardless of the pandemic?
Governor Ducey: Well, we’ve lowered or simplified taxes every year I’ve been in office. I ran on a platform of getting the income tax as close to zero as possible. Yet my first year, as I said, we had a $1 billion deficit in a sluggish economy. So, I knew that to get the income tax cut that I wanted, we were going to have to have a growing economy, a balanced budget, and a plan. And it would take two terms. So, as we got to this point, coming into 2020, we had the largest [budget] surplus in state history. We already had a billion-dollar balance in our rainy day fund. And with that much additional funds in our general fund, while putting record investment into K-12 education and our social safety net, I thought that our taxpayers deserved a break. We were able to get a $2 billion tax cut.And in addition to that, in that same session, we paid off $2 billion of debt. So, our state is fiscally healthy, very sound, and growing.
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