Governor Terry Branstad and Democratic State Senator Jack Hatch are holding their second debate tonight in Burlington. The discussion will focus on economic issues. C-SPAN is televising the debate (channel 95 in the Des Moines area). I’ll be live-blogging after the jump. I expect to hear a lot of bogus statistics from Branstad about jobs he allegedly created. Reality: no economist or labor market analyst tracks the fake statistic the Branstad administration made up (“gross over the month job gains”). That’s just a fiction to allow Branstad to claim he’s on track to create 200,000 jobs. Also, median incomes in Iowa have not grown significantly.

Any comments about the debate or the governor’s race in general are welcome in this thread.  

KWQC, the Burlington Hawk Eye newspaper, and the Greater Burlington Partnership are co-sponsoring this debate. Panelists are KWQC reporter Danielle McCarthy and Dale Alison, managing editor of the Hawk Eye.

McCarthy asks Hatch what he could do to make Iowa’s jobs environment better. Unemployment is already lower than national average at 4.4 percent. Hatch says every state suffered higher unemployment during recession, and it’s good that unemployment is falling in every state, not just in Iowa. To create next generation of jobs, the governor needs to do something different, build economy from the community up (not the top down)–Hatch would create four regional economic development authorities in Iowa. Local authorities know where the jobs are and what communities need. State government can provide dollars more dispersed around the state. Those regional economic development authorities will identify the opportunities.

Branstad says Illinois has second-highest unemployment in nation, while Iowa’s unemployment is lower and falling. I’m proud that we’ve created over 150,000 jobs, gone from highest unemployment in years to record number of people employed. The fertilizer plant happened because people in Lee Co partnered in state government.

Hatch says it’s important to understand those numbers. The governor says 150,000 jobs created, but even a fifth grader knows you have to subtract what you’ve lost. Over 80,000 jobs lost. Net gain is 75 or 80,000 We know that governors don’t create small businesses–entrepreneurs do.

Dale Alison asks Branstad about 2010 campaign promises, creating jobs and increasing personal income by 25 percent. Brastad says four years ago unemployment in SE Iowa was highest in state. It’s down 40 percent in SE Iowa. Fertilizer plant will have 240 permanent jobs, 1900 construction jobs now. We’re working every day to bring good jobs to the state of Iowa. We work in partnership with local governments. Would be a big mistake to divide state into four regions. Wouldn’t have resources to take advantage of big opportunities. Talks about STEM education and other initiatives.

Hatch rebuttal: It’s clear that the top-down approach where Des Moines picks winners and losers is wrong approach to help recover from recession. Need local govts to be able to empower their own communities. Leverage local dollars w/state dollars. Wrong to say only Des Moines makes decisions. That’s wrong direction.

Moderator says next Q about tax incentives, particularly related to Orascom fertilizer plant. Dale Alison asks about negotiations to land a big deal. Some people weren’t happy that those happened in secret, included things such as water rights. Iowa Fertilizer has upped its demand for water–how is that good public policy for Iowa?

Branstad says Lee Co supervisors initiated deal, offered incentives. Net result is that Lee Co and Fort Madison school district will gain revenue. We wouldn’t get those revenues if the plant hadn’t located here. He talks about how fertilizer costs are major input cost for corn farmers, and having this plant here will help Iowa’s economy. Site Selection magazine said it was the second best deal in the country.

Hatch’s rebuttal says he supports fertilizer plants and jobs but Branstad negotiated a bad deal. Orascom deal works out to $700,000 in state money for every permanent job created. Vilsack admin gave tax incentives to Siemens for wind turbine blade manufacturers that worked out to $7,000 per job.

Branstad says without the incentives we wouldn’t have gotten the jobs. Debi Durham is a skilled negotiator (note from desmoinesdem: I really did laugh out loud)

Next question is to Hatch about his business using tax incentives. He talks more about Orascom deal being bad for Iowa, how Orascom is already changing terms of deal to make it worse. Hatch says Branstad’s assertions about his business are outrageous. Des Moines Register spent six weeks investigating them, he opened up his business records, and Register found that Hatch used tax credits correctly. KCRG fact-checked governor’s claims about Hatch use of tax credits and found them to be false.

Branstad challenges Hatch to release more years of his tax returns. He’s willing to release four more years of tax returns if Hatch will.

Hatch notes that he built affordable housing in areas that no other developers would to into. DMR editorial concluded that Hatch’s use of tax credits was appropriate, providing housing for low-income Iowans. Branstad is providing dollars for extremely profitable Egyptian corporation.

Next Q to Branstad: Notes that out of state contractors have brought in workers from outside the area to build fertilizer plant. Branstad says lots of local people have gotten jobs, talks up apprenticeships and other programs to create jobs in construction industry. Branstad talks about jobs in other places, Fort Dodge, Sioux City, Osage, elsewhere.

Follow-up question: were there not enough skilled Iowans to take these jobs? Branstad says there were not enough, and that’s why we need better job training, apprenticeships in construction field.

Hatch says we’re talking about economic opportunity explosion in jobs over next few years, but we won’t do it if we put all our eggs in basket of large corporations and large projects. We’re going to focus on small business. Brings up Tom Vilsack’s SE Iowa vision for job creation. Those projects created opportunities.

Next Q from McCarthy on minimum wage: won’t a minimum wage increase hurt small business owners? Hatch says good question, but you’re assuming that all small businesses pay minimum wage. Right now more than 200,000 Iowans get less than $10.10 hourly wage. That’s barely above poverty level. NO Iowan should work 40 hours a week and not be above poverty level. It will life 216,000 Iowans up, getting some of them off public assistance. Small businesses do not pay cheap–many of them pay well, all over the state. They aren’t going to be afraid of $10.10 minimum wage. People get that money and can spend it in their communities.

Branstad says Senate Democrats killed minimum wage bill. As governor I reserve judgment until I see final bill. Dem-controlled Seante didn’t pass it. My focus is to bring good jobs to Iowans, living wage, we work at that every day. We work on workforce devel and economic development.

Hatch quotes Truman saying Republicans believe in minimum wage: as minimum as possible. He says they talked to Iowa House Rs and governor’s office, got clear signal that House would not pass bill, governor did not support bill. Senate Majority Leader decided not to pass it in political year. But reason it failed was lack of Republican support in House. They had votes to pass it in Senate.

Next question is from twitter: someone works full-time and wife does too yet they are living paycheck to paycheck. Branstad says that’s why they are working every day to create good jobs. Name-drops projects in various towns and cities. People need to have skills for those jobs. I’m working on this every day.

Hatch notes that Branstad claims he wants to replicate deals like Orascom, but he doesn’t have the money to do more deals like that. We need to understand that every middle-class Iowa family is getting taxed too much. We have proposed mid-class tax cut. We understand that if you live paycheck to paycheck, state has responsibility to invest in communities and small businesses.

Q to Hatch: Branstad keeps getting re-elected, but your ads focus on criticism. Is he saying Iowans don’t listen? Hatch says it is a scandal-ridden administration. Mentions closure of Iowa Workforce Development offices, juvenile home, political firings of state employees, hush money to keep them quiet, black list of people not to hire for state jobs, firing of top aides, speeding incident that led to firing of DCI agent. Governor trying to force Chris Godfrey to resign as Workers Comp commissioner. This isn’t leadership, this isn’t good management of state.

Branstad: Iowans know me, they know I go to every county every year, they know I have a press conference every week, I’ve released my tax returns, Iowans know these attacks are false, I have nothing to hide, I’m proud that I signed order to bar more secret settlements. I want honest, open, clean government Senate killed bill.

Hatch: Iowans don’t know what’s going on. Look at his ads attacking me–you’d think I’m under investigation. But his ads are false. I’ve done nothing wrong, I followed the rules. Des Moines Register and KCRG found his charges to be false. I ask Branstad to take a cue from Reagan: you stop lying about me and I’ll stop telling the truth about you.

Social media question: why did Branstad delay deposition in Godfrey trial if the charges are false? Branstad says we have nothing to hide, I’m busy during campaign. I will do deposition later. Everything in our ad has been documented. He killed bill that would have reduced fees for tax deals he benefits from. Again brings up Hatch tax returns.

Hatch asked about lawsuits against governor. Fact is I’m repeating lawsuits, investigations, even state auditor said governor mishandled investigation of secret settlements. It’s unacceptable for him to say he has nothing to hide, when that’s all he’s been doing–hiding.

Branstad says this is Iowa, not Illinois. Most Illinois governors end up in jail but Iowans brought me back because they trust me, I have a press conference every week, I am open. Again brings up bill that Iowa House passed but Senate blocked that would have opened up confidential state employee personnel files.

Hatch says these accusations are not something we’ve made up. Republican Governors Assoc and Branstad has spent millions attacking me on tv with stuff they made up. We did not kill bill that would have reduced fees. Des Moines Register story noted that the bill that died had no support, wasn’t taken up, but wouldn’t have affected Hatch’s developer fees anyway.

Alison asks Branstad about property tax reform working against smaller, low-growth communities. If taxes are being lowered for upper values, some other people will have to pay more to make up for it. How can you assure ordinary Iowans that they won’t have to shoulder bigger burden?

Branstad says property taxes have been problem for 30 years. He talks about agreement between Senate Democrats and his office, claims it will provide tax relief to businesses small and large. He claims it will help rural and slow-growth communities. State will replace lost local property tax revenues.

Hatch says commercial-industrial property tax bill did nothing for residential property taxpayers. Branstad’s priority was lowering corporate taxes, not residential. If not for Senate Democrats, that provision that helps small businesses would never have seen light of day. Bill did not help middle-class or small property owners–boon was for big out of state commercial property tax owners.

Branstad says bill passed with bipartisan support and was long overdue. This will make a difference, will be most significant property tax cut in Iowa history. I cut the size of government so that we could afford to do this as well as education reform.

Next Q to Hatch about his middle-class income tax cut, which would cost state $300 million per year. Is that the best use of money when we have other needs? Hatch says helping middle-class is best use of money. They need that help. We are sixth highest state for dual-income families but we are low-wage state. We value productivity in this state and children. We should be giving higher tax credits for children, stronger middle-class cut for people who need it most, not these corporations. Branstad’s focus is big business. You can tell me about your values, but show me your budget and I’ll tell you your values.

Branstad says ending federal deductibility will hurt some low-income people too (note from desmoinesdem: not really. Wealthy get most of the benefits from being able to deduct federal tax payments from taxable state income). Our property tax bill wasn’t just for big business, real Iowans who own commercial property got real relief.

Hatch says being a leader means you set priorities. Governor says he wanted tax cut for people who own commercial property. My priorities will always be with the middle class.

Next Q is about infrastructure, gas tax. Branstad, you’re a pay as you go guy, but DOT says we don’t have funds to maintain our roads and bridges. Names some projects that aren’t being completed. Lawmakers said there was support for gas tax if you had supported it, but didn’t want to risk passing it if Branstad would veto.

Branstad says his DOT director is working on new system for funding roads. Praises his DOT director and says we are doing lots of road-building. I will work with him and bipartisan group of legislators on new system. I will lead, with majority of both caucuses supporting.

Hatch says you can’t lead without a proposal. I’ve had a proposal for the last two years. 10 cents gas tax increase (2 cents a year for 5 years). We are second-worst state for bridge repair in country. We need revenue to address this. Jackson Co is reducing weight limits on some bridges, which hurts farmers and restricts emergency vehicles from using some bridges. No leadership from Branstad.

Hatch goes first with closing statement. Thanks sponsors and panelists. Acknowledges his wife, running mate Monica Vernon, and his daughter. Being governor means we have to lead state to economic explosion. I want to return to Tom Vilsack approach of diversifying economy, not just focusing on ag and picking winners and loser from Des Moines. Regional boards of econ development, and Monica Vernon would take lead on this issue. Local business leaders know what they need, and we would rely on their advice. We need bottom-up approach, not top-down.

Branstad also thanks sponsors, audience members. Proud to be in Burlington, first territorial capital of Iowa, his mother was from here. He loves this state, grew up on a farm, he works hard every day, goes to every county every year, we work to bring good jobs to Iowa. We’re not done yet. We are focused on college affordability and reducing student debt. We want internet everywhere in Iowa. I would appreciate your vote of confidence. I love Iowa and am proud to serve you and ask for your vote.

End of debate.

I would have liked to see a little more follow-up on some of these questions. Branstad kept giving non-responses, saying he loves Iowa and Iowans know accusations are false, rather than dealing with the substance. It’s also been well-established that Orascom had many reasons to build in Iowa and did not need such a sweetheart deal from the state to build here.

I thought Hatch did well to drive home that the focus of Branstad’s efforts (economic development and tax policy) has been big businesses, not average Iowans. Unfortunately, Branstad was able to get him to spend too much time explaining why the Branstad campaign ads are false. Journalists should have pressed Branstad to explain why he is still running ads that have been shown to be false by independent fact-checkers.

Branstad was able to glide quickly past the fact that he hasn’t kept his 2010 campaign promises on job creation and income growth. I think Hatch needs to pound that message home. Branstad uses fake numbers to make it look like he’s created more than 150,000 jobs. Net job creation is far lower than that. Personal income growth is negligible.

It is smart for Branstad to keep changing the subject to how he loves Iowa and visits every county every year, because you can’t really argue that. The problem is how he expresses his love for Iowa and the priorities he sets.