WEST LAFEYETTE, Ind. – Mitch Daniels has been a transformational leader for Indiana.

For his eight years as governor, he charted a much different course for the Hoosier State than the one taken by Illinois.

On Monday, I sat down with the former governor, who now leads Purdue University, and asked him to discuss his time at Indiana’s helm.

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“I told my people early on in my administration that I wanted to build the best sandbox in America. I wanted to create an environment that encouraged the hiring of people and more investment in Indiana,” he said. “I asked them to consider what they can do better, faster – or stop doing – to ensure that the next job comes here and not Illinois or some other state.”

Daniels said focusing on improving the overall business climate has been the key to Indiana’s success.

Just consider:

  • Illinois remains down 157,000 jobs since the recession began in January, 2008. But Indiana has regained all the jobs lost during the recession and created an additional 6,200 jobs. And that’s despite Indiana’s job losses from the recession being more severe than Illinois’.
  • Since the bottom of the recession, Illinois has created 253,000 net new jobs while Indiana has created 235,700. And Indiana has a population only half that of Illinois.
  • Since January 2009, when Illinois Gov. Pat Quinn took office and Daniels entered his second term, Illinois has created 33,800 net new jobs and Indiana 139,400.

Daniels indicated Illinois and other states have become overly reliant on offering special incentives to select businesses.

Folks on the left call this practice “corporate welfare” and on the right they call it “crony capitalism.”

“When you give the checkbook of incentives to a politician, his incentive is to hand out the dough and cut the ribbon. If the jobs don’t show, it’s somebody else’s problem,” he said. “We don’t behave that way in Indiana and I wish fewer politicians across the country – Republicans and Democrats – would as well.”

Daniels added he had a firm policy against offering tax incentives to companies threatening to leave Indiana unless they received a taxpayer subsidy. And while the Hoosier State does give some incentive packages to companies considering moving there, Daniels said his administration was selective and frugal when making such offers.

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Illinois on the other had has given incentive packages to a variety of large corporations in hopes of keeping jobs from leaving the Land of Lincoln.

Daniels also focused on reducing taxes for businesses and individuals.

The income tax in Illinois is currently 5 percent, while Indiana’s is 3.4 percent and scheduled to drop to 3.23 percent in 2017. Illinois’ income tax is set to drop to 3.75 percent in 2015 and 3.25 in 2025, but that could change during the lame duck session.

Daniels pushed for property tax caps during his time in office.

“We now have one of the lowest property tax rates in the country. I can never resist pointing out that depending on where you live, Indianans pay one-third to one-fifth the average rate in Illinois.”

Indiana also is in the process of eliminating it inheritance tax.

“We want to keep that money in Indiana.” Daniels said. “Too often we see retirees moving to other states because they don’t want to see that money taxed.”

When these people move, it hurts the economy because their wealth is being invested elsewhere, he said.

“We came to hope Hoosiers would come to like being national leaders in business climate, fiscal integrity, in education change and in infrastructure building. Our hopes are they will continue to expect that from their leaders.”

As Illinois continues to lose jobs to Indiana, Daniels was uncharacteristically silent on what Illinoisans should do.

“I never offer advice to those living in other states on what they should do, those are things they have to work out,” he said.

Authored by Scott Reeder

Published with permission