boston.com Business your connection to The Boston Globe

Would presidency benefit Bay State?

It would seem to provide a home-field advantage, but economists say winning a race for the Oval Office is no guarantee of a financial grand slam for the victor's home state.

Not long ago, a tourist from Copenhagen had a question for Patrick Moscaritolo, head of the Greater Boston Convention & Visitors Bureau. The man didn't want to know how to get to the Freedom Trail or Quincy Market. He wanted directions to Louisburg Square on Beacon Hill so that he could take a look at John Kerry's house.

To Moscaritolo, whose business is promoting tourism, the incident was a tantalizing hint of what the future might look like if the Massachusetts senator is elected president. "It would raise the visibility of our city and state," said Moscaritolo, who predicts a Kerry presidency would be good for local tourism.

But economists from the states that have produced the last four presidents -- Texas, Arkansas, and California -- say their states derived no meaningful economic lift when native sons occupied the White House. "Having the president from your state is overrated," said Stephen Levy, director of the Center for Continuing Study of the California Economy in Palo Alto.

Levy and the others don't dispute that what goes on in Washington can make a difference to local economies. The federal government last year alone distributed $30 billion for highways, $75 billion for weapons systems, and $26 billion for medical research, areas that can generate local jobs, commerce, and taxes.

The problem is that presidents aren't typically involved in deciding where the money flows. Nor should they be, said Mark Zandi chief economist at Economy.com, a Pennsylvania forecasting firm. "Presidents can't be geographically partisan," said Zandi. "When you are the president, you represent the entire country."

Others suggest it would be unseemly for a president to concern himself with nitty-gritty decisions on individual spending projects. As James Howell, a local economic consultant, put it, "Presidents don't build gymnasiums."

To be sure, presidents can put in place policies that have important economic implications for certain states. For instance, if a President Kerry boosted spending on medical research, Massachusetts would be a prime beneficiary. The state gets $1.7 billion a year for health research from the federal government. The money is particularly critical to Boston. Both Massachusetts General Hospital and Brigham and Women's Hospital are regularly among the top 10 recipients of federal health grants in the nation.

In a similar vein, California's economy got a boost from the defense buildup ordered by President Reagan, a Californian. Under Reagan, prime defense contracts going to California -- for projects that included planes, satellites, and missiles -- rose from $14 billion to almost $30 billion between 1980 and 1985.

But when defense spending started to decline in the late 1980s -- the result of Reagan's success in winning the Cold War -- the California economy took a disproportionate hit. By the mid-1990s, defense contracts were down to $18 billion and more than 100,000 aerospace jobs had disappeared. The state also got punished toward the tail end of the Nixon administration when defense spending declined after the Vietnam War. The fact that Nixon was from California did not protect the local economy, Levy noted.

President George W. Bush's most important domestic achievement is probably the string of tax cuts he pushed through Congress in 2001 and 2003. The tax cuts benefited the whole country, including Texas. But because the tax cuts were tilted heavily toward the well-to-do, high-income states such as Massachusetts, New York, and California -- states unlikely to vote for Bush -- got a bigger pop from the tax cuts than did Texas. "I don't think President Bush has been much of a factor in our economy," said Ray Perryman, president of the Perryman Group, a consulting firm based in Waco, Texas.

Presidents may not build gymnasiums, but congressmen do. Powerful congressional delegations, much more so than presidents, have the ability to bring money back home from Washington. "The real pork barrel comes from the speakers of the House," said Howell.

When he was speaker of the House, Massachusetts Representative Tip O'Neill was famous for the clout he wielded on spending projects. O'Neill's greatest achievement may have been winning $8.5 billion in federal funding for the Big Dig. On the defense side, O'Neill helped secure money for major projects such as the Patriot Missile at Raytheon and research on defense electronics at MIT's Lincoln Laboratory.

Texas, another state with a history of influential congressional delegations, benefited from the largesse delivered by former Speaker of the House Sam Rayburn and former Senate Majority Leader Lyndon Johnson. According to some historians, Johnson even continued to deliver for Texas as vice president when he played a role in getting the National Aeronautics and Space Administration to locate its headquarters near Houston.

Senator Edward Kennedy may not be in a league with Johnson, but according to Howell, he has been a key patron of the Massachusetts economy -- more so than Kerry. Kennedy has done a lot for hospitals and universities. He is also credited with winning federal dollars for the $14.6 billion Big Dig, the $6 billion Boston Harbor cleanup, the $269 million John Joseph Moakley Courthouse on the South Boston waterfront, and the $80 million Boston University Photonics Center.

"He has been a major friend," said Howell of Kennedy. By contrast, it is hard to identify specific projects associated with his brother, former President John F. Kennedy, with the possible exception of the Kennedy Library, which cost $18.5 million to build.

On the tourist front, presidents may benefit their home states a bit, particularly if they come from smaller states. Consider the case of Bill Clinton and Arkansas. In Little Rock, work is being completed on the William J. Clinton Presidential Center and Park, a $165 million construction project, the largest in the city's history. The construction alone is expected to create 1,500 jobs. According to John Shelnutt, director of research at the Institute for Economic Advancement at the University of Arkansas at Little Rock, the library is an integral piece of a downtown revitalization scheme that has attracted millions of dollars in private development money to Little Rock.

In a bigger state, the impact of a presidential library is more like a drop in the ocean. The Ronald Reagan Library and Museum in California attracts about 170,000 people a year. That is a substantial number, but compared to a major California tourist site -- Disneyland draws more than 12 million visitors annually -- the library is small potatoes.

Kerry's impact on Massachusetts tourism could be similarly modest. Boston is not exactly an unknown tourist destination. The same is true for Nantucket, where Kerry has a summer home. Nantucket could conceivably be Kerry's main vacation home, much like the Bush ranch in Crawford, Texas.

"If Kerry brings more business to Nantucket, that would be fine with me," said Tracy Bakalar, executive director of the Nantucket Island Chamber of Commerce. On the other hand, Kerry and his wife, Teresa Heinz Kerry, also have homes in Pennsylvania and Idaho where they might choose to vacation.

Charles Stein is a Globe columnist. He can be reached at stein@globe.com.

SEARCH THE ARCHIVES
 
Today (free)
Yesterday (free)
Past 30 days
Last 12 months
 Advanced search / Historic Archives