Brian Sandoval: Hot or not?

hot or not?
Gov. Brian Sandoval's Facebook profile photo

Brian Sandoval won the governor’s office in 2010, when Republicans were in the throes of Tea Party passion. As he leaves office, his party has surrendered to Trump and Trumpism.

Whether through sense, or temperament, or both, Sandoval became neither a Tea Party darling nor a Trump sycophant, instead building a brand as what has become that rarest of Republicans, a centrist.

Sandoval was the first Republican governor in the U.S. to expand Medicaid under the Affordable Care Act. He established a tax on business to fund education. Policymakers, education administrators, executives, and other types of people who might be introduced as “thought leaders” at a TED Talk, are nearly universally enamored with Sandoval and his governorship.

So he’s pretty hot.

Except when he’s not.

When Sandoval took office in January 2011, the Great Recession had already hit Nevada harder than any other state, and his predecessor, the bungling Jim Gibbons, had responded by cutting government spending.

Sandoval’s response was … the same. The new governor and the 2011 Legislature cut social services and reduced pay for K-12 teachers and higher education faculty and staff. State workers were furloughed. Some were laid off. Sandoval sold the plan as “shared sacrifice,” but businesses were given a tax cut.

Sandoval and lawmakers deprived vulnerable Nevadans of public services and lowered people’s pay, effectively taking money out of the economy, to protect business from higher taxes while balancing the budget. His constituents crushed under the most devastating economic collapse since the Great Depression, Sandoval opted to channel Herbert Hoover.

Following Sandoval’s first legislative session, one business lobbyist boasted “My big guys will be paying the same, and all my little guys will be paying nothing.”

Well, Nevada is constitutionally required to balance its budget. And Nevada businesses were hurting too.

But not all of them.

While Nevada was playing the austerity card, the gold mining industry, which sometimes performs counter-cyclically to the larger economy, was flirting with record profits. When Sandoval became governor in January 2011,  the price of gold was more than $1,330. Later that year, it spiked at more than $1,800, and rarely dipped below $1,700 for most of the next two years. (In 2018 the price has hovered between $1,200 and $1,300.)

Higher mining taxes alone may not have allowed the state to forestall all the budget cuts Sandoval and lawmakers made in 2011. But Sandoval, though willing to slash public services and educators’ pay, refused to even consider higher mining taxes.

When pressed about raising mining taxes during an interview on Jon Ralston’s former TV show, Sandoval defended the industry, not with statistics or evidence, but by repeatedly saying “I believe” mining pays its fair share. Sandoval may have been reflecting an old Northern Nevada instinct to automatically apologize for mining. But resorting to belief instead of facts was also a literal expression of faith in the proposition that government’s highest priority is helping business.

Or as Sandoval explained in his first state of the state address, “Unemployment, foreclosures, bankruptcy – the cure is not more government spending, but helping businesses create jobs.” Gibbons couldn’t have said it better himself.

Sandoval’s “belief” in the virtue of promoting the private sector, even if at the public’s expense, is, for him, just common sense, so taken for granted he doesn’t even recognize that it is an ideology.

The exception of course was his commerce tax on business in 2015, by which time the national economic recovery had finally started to make its way to Nevada. While small, the tax at least helped to begin restore education funding (although the income that was lost due to earlier cuts will never be restored).

The true shiny objects of Sandoval’s governorship, however, were special sessions of the Legislature, called not to fix education or address material hardship suffered by working Nevadans struggling with low pay and deteriorating working conditions, but to grant hundreds of millions of dollars to big business, specifically Tesla and the National Football League.

Sandoval and his admirers point to those deals and the overall expansion of public assistance for private companies — the centerpiece of Sandoval’s economic policy — as the cause of Nevada’s economic recovery from the Great Recession.

The broader national economic rebound, on which Sandoval’s policies have had zero influence, is far more responsible for Nevada’s recovery. Such as it is. Nevada’s recovery is recognized nationally as a notoriously low-wage affair.

In this indexed chart, the red line represents Nevada’s overall economy, while the blue line represents median household income, from 2010 through 2017, which is to say roughly coinciding with Sandoval’s tenure as governor.

not hot
Federal Reserve Economic Data

Nevada’s economy has grown since 2010. It would have no matter who was governor. In 2010, there was nowhere to go but up.

But income growth is negligible by comparison. Whatever the fruits of Nevada’s recovery, they’ve been poorly distributed.

Sandoval has demonstrated he has very strong feelings about how the benefits of economic growth should be distributed: He’s quite sure it’s none of his damned business.

When Democrats in 2017 tried to raise Nevada’s minimum wage, Sandoval’s office objected that raising the wage was unnecessary because his “workforce development” programs would equip everyone for all the great jobs being created in the “New Nevada.” It was an optimistic argument. It also reflected a deep denial — the number of jobs created in tech or manufacturing or other “New Nevada” industries is dwarfed by the hundreds of thousands of Nevadans in low-pay service sector jobs. That isn’t going to change anytime soon.

Arguing higher wages would hurt business, Sandoval vetoed the minimum wage bill. He used the same concern for the welfare of business to justify his veto of legislation requiring many private sector employers to provide their employees with earned sick leave.

Couple those vetoes with the billions of dollars the state has granted in tax breaks and subsidies to businesses small, large, and extra-large during Sandoval’s administration, and Sandoval’s ideology is obvious: State government must help business, but not workers. Sandoval at heart is a trickle-down guy, with a workforce training flavor spike.

So why bother to analyze Sandoval’s economic record now, as he’s headed out the door? Partly just for posterity, and as a counterpoint to less critical retrospectives currently being published. But also as a cautionary tale. You see, for all those policymakers who think Sandoval is hot, currently the most prominent fan of Sandoval’s economic policies is the man who is about to replace him.

Hugh Jackson
Editor | Hugh Jackson was editor of the Las Vegas Business Press, senior editor at the Las Vegas CityLife weekly newspaper, daily political commentator on the Las Vegas NBC affiliate, and author of the Las Vegas Gleaner political blog. Prior to moving to Las Vegas, he was a reporter and editor at the Casper (Wyoming) Star-Tribune.


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