Senate Select Committee on Economic Growth and Employment, Feb. 9

Geoffrey Lawrence


The first meeting of the Senate Select Committee on Economic Growth and Employment has just begun with Chairman Kihuen declaring that “The #1 job of this legislature is to create jobs.” That’s not a good sign to kick off a committee on economic development, given that governments don’t create jobs, they can only lay the foundations for an economic environment capable of creating jobs on its own. However, government “stimulus” policies can destroy jobs across the economy in order to channel resources into a highly concentrated and visible industry – like construction.

That’s what is at the heart of this committee’s purpose. The committee today will consider a proposal developed by the construction lobby to issue new public debt in order to finance massive new public construction projects across the state in a government make-work effort. Details are available at the “Building Jobs Coalition” website.

The construction lobby has packed today’s hearing with union members bused in from around the state to put pressure on lawmakers to burden the public with new debt for the benefit of this specific interest group.

Lobbyists throughout the legislative building are saying that there are already enough votes in the Assembly to approve legislation implementing the massive make-work “stimulus” project, and that supporters are only two votes short in the Senate. And that’s before the hearings and union-pressure machine began. Governor Sandoval has wisely indicated that he does not support the proposal.

If approved, this plan would be a scaled version of the failed federal ARRA stimulus package. The plan calls for the creation of 100,000 new construction, engineering and architecture jobs to be created across the state. However, the model does not appear to account for supply-side constraints. It also accounts for a “multiplier effect” resulting from new dollars circulating in the economy, but fails to account for the off-setting negative multiplier that will result from the higher taxes that would be required to service debt levels. It further ignores all distortions in the capital structure and associated opportunity costs that would result if the plan is implemented.

These, among other major analytical weaknesses, will ensure that this state-stimulus plan will fail to achieve its objectives just as the federal stimulus plan has done.

Geoffrey Lawrence

Geoffrey Lawrence

Director of Research

Geoffrey Lawrence is director of research at Nevada Policy.

Lawrence has broad experience as a financial executive in the public and private sectors and as a think tank analyst. Lawrence has been Chief Financial Officer of several growth-stage and publicly traded manufacturing companies and managed all financial reporting, internal control, and external compliance efforts with regulatory agencies including the U.S. Securities and Exchange Commission.  Lawrence has also served as the senior appointee to the Nevada State Controller’s Office, where he oversaw the state’s external financial reporting, covering nearly $10 billion in annual transactions. During each year of Lawrence’s tenure, the state received the Certificate of Achievement for Excellence in Financial Reporting Award from the Government Finance Officers’ Association.

From 2008 to 2014, Lawrence was director of research and legislative affairs at Nevada Policy and helped the institute develop its platform of ideas to advance and defend a free society.  Lawrence has also written for the Cato Institute and the Heritage Foundation, with particular expertise in state budgets and labor economics.  He was delighted at the opportunity to return to Nevada Policy in 2022 while concurrently serving as research director at the Reason Foundation.

Lawrence holds an M.A. in international economics from American University in Washington, D.C., an M.S. and a B.S. in accounting from Western Governors University, and a B.A. in international relations from the University of North Carolina at Pembroke.  He lives in Las Vegas with his beautiful wife, Jenna, and their two kids, Carson Hayek and Sage Aynne.