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Sorting out the truth in state politics

PolitiFact Florida: Gov. Rick Scott right that Florida economy soured under Charlie Crist but wrong to blame him

Former Gov. Charlie Crist has the Florida political world buzzing about a potential face-off with Republican Gov. Rick Scott in 2014.

Scott's response to the hypothetical showdown with the Republican-turned-independent-turned-Democrat has been simple: Avoid direct comment but point out how Florida hemorrhaged jobs under Crist's watch.

"The four years before I became governor, the state had lost 825,000 jobs. Unemployment had gone from 3.5 percent to 11.1 percent. We incurred another $5.2 billion, I think, worth of debt," Scott said last week at a news conference.

We thought his talking points about Florida's economy under Crist merited a fact-check. It probably won't be the last time Scott takes a dig at his predecessor.

PolitiFact has addressed similar jobs claims about governors in many states. We often find the numbers are right but the blame is exaggerated. The impact of a governor on a state's economic health is usually pretty small, experts say.

Scott's math on the number of jobs Florida lost during Crist's tenure is correct if you compare the month before his inauguration (December 2006) with his last month in office (December 2010). Florida's workforce contracted from 8,043,000 non-farm workers to 7,217,500 — a loss of 825,500 jobs, according to Bureau of Labor Statistics figures.

The state lost half of its construction jobs during that period, shrinking from 668,600 to 336,400.

Scott has touted the state's declining unemployment rate under his tenure as a sign of economic improvement. (But a rapidly declining rate is not always worth bragging about, because it has been the sign of a shrinking workforce as a result of discouraged workers giving up on finding jobs in the state.)

There's no denying Florida's employment situation went from robust to bleak under Crist. In December 2006, the state's unemployment rate was 3.5 percent. In December 2010, the rate was 11.1 percent.

The state's unemployment rate has inched down in the months since Scott took office. The most recent rate was 8.5 percent in October.

Mark Vitner, Wells Fargo senior economist, said assessing who is responsible when things go bad — or when they improve — is a difficult task. The more pertinent question, he said, is: "What policy action did you try to take to try to mitigate the economic recession or engender an economic recovery?"

"Whether it was luck or whatever, during his tenure Florida's economy sank into the worst recession since the Great Depression," he said.

Chris Lafakis, a senior economist at Moody's Analytics who studies Florida, said Crist is not responsible for the state's economic decline because "the seeds of destruction" had already been sown by the time he took office.

Home sales and prices had already peaked in 2005 and 2006. Behind the scenes lurked a number of major issues: mortgage lending to borrowers who couldn't afford to repay their loans and Wall Street bankers buying those loans and selling them to investors.

"I don't remember hearing about states in 2004 taking a stand against home building," said Sean Snaith, director of the Institute for Economic Competitiveness at the University of Central Florida. "It was bringing in revenue. There was a lot of benefits that the boom side of the housing market created. There were significant costs when we went into bust."

Added Lafakis: "That had very, very little to do with Charlie Crist."

The onset of the housing crisis, coupled with the state's dependence on a constant flow of new residents, meant Florida suffered more than other states, he said.

The wealth of out-of-state retirees "was eviscerated" during the recession, he said, making them less able to retire in Florida. And working-age people faced either reduced job opportunities in major metro areas like Tampa and Orlando or could not sell their homes and relocate here, Lafakis said.

"Would it have been different with someone else in office?" Lafakis said. "The wheels were already in motion. He (Crist) suffered from the worst timing that you could pick."

And unlike the federal government, the state government cannot run deficits in an effort to stimulate the economy because of balanced budget requirements. States basically "have to ride it out," Snaith said.

Scott is right about the grim jobless figures: The state's employment picture worsened almost as soon as Crist became governor and did not let up.

But Scott misses the mark for implying the state's recession was the result of a poor handling by Crist. Florida's economy tanked largely as a result of the housing market crisis, a tornado of issues over which Crist had little to no control.

We rate Scott's statement Half True.

The statement

Under Charlie Crist, Florida lost 825,000 jobs and the unemployment rate increased from 3.5 percent to 11.1 percent.

Gov. Rick Scott, Tuesday in a news conference

The ruling

PolitiFact ruling: Half True
Scott is right about the grim jobless figures but misses the mark for implying the state's recession was the result of a poor handling by Crist. We rate Scott's statement Half True.

PolitiFact Florida: Gov. Rick Scott right that Florida economy soured under Charlie Crist but wrong to blame him 12/18/12 [Last modified: Tuesday, December 18, 2012 10:24pm]
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