Last year, in a massive, high-profile, bidding war, the corporate behemoth that is Amazon announced that it would be opening a second headquarters, and would be accepting applications for this opportunity. 

Altogether, 238 cities/states applied for the opportunity. For months, Amazon made it seem that it would be seriously considering all proposals, before ultimately settling on two massive urban centers in New York City and outside Washington D.C. in Northern Virginia. While 24 different applications came from Massachusetts, only one came from Mississippi, and records don’t seem to provide the name of the city that applied. This process reveals the lacking capacity of Mississippi to draw in major business programs.

Now this process was inherently flawed, as it encouraged states to dole out state-sponsored bribes in the form of tax incentive programs and to favor one company over others. However, it also reveals the structural challenges Mississippi faces in attempts to be competitive against other states when it comes to the modern market incentives to draw in and sustain businesses. 

We have previously written about the need to reduce crime to positively influence population growth in the Jackson area. But that’s not all. There are also legislative and regulatory policies hindering business growth in the state, and changes that could be made to prepare for the future.

As city and state leaders further consider the future, they ought to reflect on how best to build an environment which positively promotes business development and entrepreneurship on the local level. 

To meet this end, Jackson, Ridgeland, Madison, Flowood, and Pearl need to consider branding themselves not just as individual cities competing for business and citizens, but as the Greater Jackson Area along with the capital city. 

This type of community partnership has proven quite effective elsewhere across the country, especially in the Dallas-Ft. Worth area, and the Research Triangle that is Raleigh-Durham-Chapel Hill in North Carolina. In these cases, cities have been able to combine their individual strengths such as education centers, available land, working-age populations, and more in order to make a more coherent pitch for both new businesses and new residents.

These strong regional coalitions have undoubtedly contributed to these cities becoming some of the fastest growing in the nation. One needs only to look into the history of the Raleigh-Durham-Chapel Hill Research Triangle to understand how a regional area can turn itself around. In the early 1950’s, the per capita income of the area was one of the lowest in the entire Southeast. Yet today, the Research Triangle cities are consistently listed as one of the best places to live in the country, and each day they attract about 80 new residents to the area.

A few key lessons emerge from the development of the Research Triangle. It was not a top down initiative driven by government. The Research Triangle was endorsed and publicly supported by leadership but was driven forward through private solutions which allowed the organization to operate with the efficiency of a non-governmental entity. The privately funded Research Triangle Institute targeted the emerging technological developments and sought to make itself a flexible institution, capable of changing with a shifting economy.

These lessons ought to be internalized by local leaders and applied to our future growth. First, government can’t dictate and direct the economy and see consistent success. We need to encourage private growth and investment, and take the government hands off the wheel. Second, only in the promotion of market freedom can we ease the regulatory burden and encourage creative entrepreneurs to steer the economy in Jackson and the greater metro area.

Recent studies reveal the unfavorable environment for starting a business in Mississippi. Business Insider ranked us the 35th best place to start a business. In a more recent report, another website ranked us the 38th best place. You can search for others that have similar results. What is clear is that we’re at least stagnating, but are potentially getting worse by comparison to other states. In these studies, while we were consistently ranked well for our cost of living, we ranked rather low in regards to our access to an educated employee base, and the actual cost of starting a business.

Another important factor in both of these studies is an evaluation of the overall entrepreneurial environment. This status depends on how many people are starting businesses and the survivability of a business. This is another factor which Mississippi and individual cities can directly impact. 

Policies that protect entrenched interests stifle economic competition and limit the ability for new business owners to break into the market. This stifling effect can be accomplished through a variety of regulatory and legislative approaches. Burdensome occupational licensing, business fees, and restrictionist policies all play a part.

Regulators often claim the need to protect citizens in establishing these rules, but really they are protecting entrenched business interests across the state. While we ought to create policy that is favorable to business, it shouldn’t favor established businesses over those attempting to break into the market. Competition is good, it incentivizes further development and elite performance. 

When a competitive business market is present, the best companies thrive, and the consumer is presented with the best options and quality of experience.

In order to help ease this burden, we need a mechanism to repeal outdated or unnecessary regulations. A few years ago we established an occupational licensing board to review new regulations, but there is still no metric in place to effectively and efficiently dismiss overly burdensome, previously established, regulations. To this end, we ought to create a non-governmental review board with the authority to roll back excessive regulations.

Currently 55 percent of our economy is controlled by the public sector. This is not sustainable for growth. The role of government in the economy is to protect property and enforce contracts, not to fuel the economy both directly and indirectly through its largesse and its allocation of contracts and resources.

In Mississippi, our leaders love to claim success in regards to our low tax rates. However, the more burdensome taxes are still present, but just better hidden, and they hit businesses especially hard. 

We tax land, buildings, inventory, and equipment at higher rates than all surrounding states. All these factors play a direct role in business decisions. As noted in Promoting Prosperity in Mississippi, the state is one of only ten that taxes business inventory. Even with an existing partial rebate, this tax punishes inventory levels and encourages states to set up shop in nearby Alabama and Tennessee, neither of whom have an inventory tax.

Furthermore, we are one of only nine states in the entire nation that tax intangible property such as stocks and bonds. This tax directly discourages any large company from basing itself in the state, because it heavily burdens companies that own their own stock (as most large publicly traded companies do).

On top of this, Mississippi maintains property taxes far above the national average. According to the authors of Promoting Prosperity in Mississippi, if the state were to set its commercial and industry taxes to the national average, then business activity could increase by up to 20%, new plant establishments could grow by up to 8%, and employment growth could increase to 2.44% per year.

Much of Jackson has been designated as an opportunity zone for the next ten years by the Tax Cuts and Jobs Act of 2017, and federal incentives have been put in place to fuel business growth and investment. By encouraging businesses to take advantage of these incentives and lightening the present tax burden on industry, we can promote new companies to invest and existing companies to expand.

For many of the regional partnerships around the country, education is a great asset (perhaps especially true in the case of the North Carolina Research Triangle). The strength of Mississippi’s community college programssets this region apart for its ability to create a workforce that is well-balanced for the next generation of jobs. Continuous education will surely be necessary as technological advancements mandate a flexible workforce. 

The region should make this factor a staple as it pitches itself for the next generation of businesses which are guaranteed to be more digital, and more technologically inclined, along with the high caliber private universities in the area. 

As we look to the future, we need to seek to free ourselves of economic reliance on the payroll of government. The pathway to success is consistently proven to be paved by private industry. 

As we attempt to make the Jackson area, and Mississippi as a whole, more attractive to businesses, we must recognize our current barriers to market growth, especially those burdens which were imposed by government with the aim of protecting existing industry rather than seeking to foster the type of economic competition which would ultimately expand it. And we must emphasize our assets, such as our community college programs and low cost of living, and then allow the market to do the rest.

This week, Mississippi Center for Public Policy will be looking into the underlying reasons as to why Jackson is struggling, exploring the legislative and regulatory climate which encourages migration and business stagnation both within our capital city, and across the state.

As a candidate for insurance commissioner in 2007, then-State Sen. Mike Chaney floated the idea of making the position he was running for appointed.

He went on to win election that year and is the odds-on favorite to win a fourth term in a couple months. The legislature never considered making this position appointed. And likely never will. Because we love electing people. Even if we don’t really know what the office does, who is running, or what other states are doing.

Today, Mississippi is one of 11 states that elect insurance commissioners. That’s not the only anomaly. 

The agriculture commissioner is elected in 12 states, mostly in the Southeast. Mississippi has three public service commissioners, divided among the northern, central, and southern regions of the state. We are one of 11 states that elects public service commissioners. That’s better than our other regionally elected office – transportation commissioner. We are the only state that still elects transportation commissioners. 

We find a little more election popularity among other statewide offices. The auditor is elected in 24 states, so close to half. The secretary of state is elected in 35 states and the treasurer is elected in 36 states, so we can at least claim to be with the majority of other states for those two positions. 

And every judge on the supreme court and the court of appeals is elected. Not to mention many of the county and municipal posts that could easily be appointed. 

Could we ever see an elected position become appointed?

The lack of interest in appointing a position like the insurance commissioner probably answers that question. But we have seen minor change here and there. 

We use to elect the state superintendent of education. And four years ago, the legislature switched to appointed school superintendents for every school district. At the time, we were one of the last three states to make the move. 

Odds are we won’t be seeing much change. People like electing officials even if the office is simply a regulatory post where the focus should be on the most qualified individual, not the one who is best at receiving the most votes. 

In this edition of Unlicensed, we talk about Tuesday's runoff, who won, who lost, and where we go from here.

And will Bill Waller endorse the Republican nominee or the Democratic candidate that he is seemingly more closely aligned with? Or will he just stay on the sidelines?

Lt. Gov. Tate Reeves defeated former Supreme Court Justice Bill Waller 54-46 in yesterday’s runoff for the Republican nomination for governor. 

Reeves advances to the general election where he will meet Democrat Attorney General Jim Hood. 

Republicans also chose their attorney general nominee. State Treasurer Lynn Fitch defeated attorney Andy Taggart 52-48. Fitch will face Democrat Jennifer Collins in November as Republicans look to finally capture the one statewide office they don’t hold. 

Republicans in the northern district chose a nominee for transportation commissioner. John Caldwell defeated Geoffrey Yoste 57-43. Caldwell will meet Democrat Joe Grist in the general election. 

And Jackson Councilman De’Keither Stamps will be the Democratic nominee for Public Service Commissioner in the central district. Stamps will face Republican Brent Bailey in November. Bailey was the Republican nominee four years ago as well, losing to Democrat Cecil Brown. 

For the legislature, five Republican incumbents and two Democratic incumbents lost their bids for re-election. As of 8:30 a.m. Wednesday morning, two races – Senate District 3 and Senate District 50 – have yet to be called. 

Races in italics have yet to be called.

Lt. Gov. Tate Reeves defeated former Supreme Court Justice Bill Waller in the runoff for the Republican nomination for governor. Reeves advances to face Democrat Attorney General Jim Hood in the November general election. 

Reeves maintained a steady lead throughout the night as results began to trickle in. The race was called shortly before 9 p.m. 

As county totals began to appear, the board looked eerily similar to three weeks ago. A huge chunk of votes for Waller in Hinds, Madison, and Rankin counties, while Reeves performed well virtually everywhere else in the state.

Waller made some new inroads, particularly Northeast Mississippi, but it wasn't nearly enough to slow down Reeves in Republican primary strongholds outside the metro area. 

Map: Counties won by each candidate

This includes the population centers that are furthest north and south in the state. 

Once again, Reeves was simply dominant in the lower six counties, most notably, the three Coast counties. Reeves won 66 percent of the vote in Harrison county, 69 percent in Hancock county, and 71 percent in Jackson county. South Mississippi again was able to provide the numbers needed to counteract Waller's strength in the metro area.

And Reeves notched a victory in Desoto county. It was carried by State Rep. Robert Foster, who represents a House district in Desoto county, three weeks ago. Foster proceeded to endorse Waller, but Reeves still won 54 percent of the vote in the county. 

Also, as of 9:30 p.m., state Treasurer Lynn Fitch was maintaining a small lead over attorney Andy Taggart in the race for the Republican nomination for attorney general. With 90 percent in, Fitch was leading 51.5- 48.5 though the race has yet to be called. 

Stay tuned. We will have more election coverage on Wednesday.

In this edition of Unlicensed, we talk about the Reeves/ Waller debate, Tuesday's runoff, and the direction of the Republican Party. 

Has anything changed during the runoff? Can either Bill Waller or Andy Taggart close the gap in their races?

Voters in both the Republican and Democratic Party will head back to the polls on Tuesday for primary runoffs. 

This will include two statewide races on the Republican side, led by the gubernatorial runoff between Lt. Gov. Tate Reeves and former Supreme Court Justice Bill Waller. Reeves led the pack, picking up almost 49 percent of the vote. Fifty-percent plus one was needed to avoid a runoff. 

Waller finished second with 33 percent of the vote. The third place finisher, State Rep. Robert Foster, endorsed Waller last week. Reeves picked up his own endorsement from an unlikely ally, State Sen. Chris McDaniel.

McDaniel, who nearly toppled Sen. Thad Cochran in 2014, and Reeves have long been at odds despite sharing many similarities when it comes to policy. This has resulted in McDaniel being largely relegated to the backbench in the Senate though he has been a more reliable liberty vote than virtually every other member of the chamber. But for 2019, the two came together. 

“No one has more reason to be displeased with Tate Reeves than I do,” McDaniel said. “But this is not about personalities, it’s about policies… I’m willing to put aside our past because I trust that (Reeves) will govern as a conservative.”

Republicans will also be selecting their nominee for attorney general. Treasurer Lynn Fitch led the field with 44 percent of the vote. Attorney Andy Taggart finished second, outpacing State Rep. Mark Baker by about 4,500 votes. Baker proceeded to endorse Taggart after the first round. 

Republicans in the Northern District will select a nominee for Transportation Commissioner. Voters will choose between John Caldwell, who received about 31 percent of the vote in the first round and Geoffrey Yoste who received 26 percent. 

Democrats in the Central District will choose between Jackson City Councilman De’Keither Stamps and Dorothy Benford for Public Service Commissioner. Stamps received about 40 percent of the vote; Benford 33 percent. 

Along with statewide and regional runoffs, voters in districts throughout the state will also be selecting the Republican or Democratic nominees in a number of House and Senate races. 

House and Senate runoffs

There were no clear winners of Wednesday’s Republican gubernatorial debate, but both candidates were able to clearly differentiate their policy positions.

Lt. Gov. Tate Reeves and former state Supreme Court justice Bill Waller battled over such topics as Medicaid expansion, infrastructure, the economy and teacher pay. 

The most pointed difference of the night was when both were asked what it meant to be a true conservative.

Reeves said being a conservative to him meant limited government, low taxes and more freedom. 

Waller said that his plans were true conservative plans because they were the pillars of economic development and that a true conservative wouldn’t allow 31 rural hospitals to close and choose not to fill teacher vacancies. 

Reeves said that he’s opposed to expanding Medicaid (which he called and has called Obamacare) because it’d mean 300,000 more Mississippians would be dependent on government. 

He also cited information about Louisiana’s disastrous Medicaid expansion, where the number of new signups was vastly underestimated and three in five Louisianans have moved from private to public insurance.

Waller agreed with the 300,000 new Medicaid participant figure from Reeves and countered that information he’d seen from a Brookings Institution study that expanding Medicaid would help Mississippi’s 31 rural hospitals financially. He also said expanding Medicaid would have a billion dollar impact on the state’s economy.

A 2016 study by the Congressional Budget Office throws cold water on that viewpoint, saying that Medicaid expansion would not “substantially alter” the solvency of hospitals nationwide.

On infrastructure, Waller said his plan was a conservative, one-for-one tax swap, eliminating the state’s four percent income tax bracket in exchange for an increase in the state’s gasoline tax. He criticized Reeves about using lottery funds for infrastructure, saying that you can’t build roads on fluctuating revenues.

Reeves countered that a gasoline tax hike would add up to $240 million and that doing a swap would be a net $80 million per year tax hike on working Mississippi families.

Both candidates agreed that a teacher pay hike was needed and both want to increase the average salary to the southeastern average. 

The Reeves/ Waller and Fitch/ Taggart battles aren’t the only runoffs for Republican nominations on August 27. There are a number of runoffs in legislative races, many including incumbents who are hoping to be back for another term.

Here is a look at the runoffs for incumbents:

Senate District 1: Sen. Chris Massey of Nesbit received the most votes with 45 percent. He will face Hernando alderman Michael McLendon, who finished second with 30 percent, in the runoff.

House District 88: Rep. Gary Staples of Laurel finished second, winning 34 percent of the vote. Ramona Blackledge, the longtime Tax Assessor/ Collector in Jones County, led the field with 47 percent. 

House District 95: Rep. Patricia Willis of Diamondhead received 31 percent of the vote. Jay McKnight, a small businessman, led with 38 percent.

House District 105: Rep. Roun McNeal of Leakesville finished second with 37 percent of the vote. He trailed Dale Goodin, a longtime public school teacher and administrator, who received 42 percent of the vote.

House District 106: Rep. John Corley of Lumberton received 31 percent of the vote. Jansen Owen of Poplarville, an attorney, led the pack with 41 percent. 

House District 114: Rep. Jeffrey Guice received the most votes at 43 percent. Kenneth Fountain, the Chairman of the Jackson County School District Board, finished second with 35 percent.

Three Republican incumbents have already been defeated in the House: Reps. Greg Snowden, who is also the Speaker Pro Temp, Jeff Smith, who is the Ways & Means chairman, and William Shirley.  

Additional legislative runoffs in the Republican primary for open seats: