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Don't Expect 'Populist Backlash' in Palmetto State Don't Expect 'Populist Backlash' in Palmetto State

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Don't Expect 'Populist Backlash' in Palmetto State


Republican presidential candidate, former Massachusetts Gov. Mitt Romney, campaigns at The Hall at Senate’s End, in Columbia, S.C., Wednesday, Jan. 11, 2012. (AP Photo/Charles Dharapak)  (AP Photo/Charles Dharapak)

South Carolina is a long way from Iowa and New Hampshire. The Palmetto State has boiled peanuts to Iowa’s deep-fried butter, and January rain to New Hampshire’s blizzards. It also has nearly double the unemployment rate of the first two states to weigh in on the GOP presidential race.

In fact, South Carolina primary voters will cast their ballots for Republican hopefuls on Saturday in a state with one of the 10 highest unemployment rates in the nation.


The South Carolina unemployment rate – which reached a staggering 11.8 percent in 2009 – dipped to 9.9 percent in November, 1.3 percent above the national rate. Both Iowa and New Hampshire’s unemployment were in the 5 percent range in November, the most recent month for which state-level data is available.

So it’s no surprise that GOP hopefuls are focusing on the economy in the Palmetto State, where primaries have historically been driven by social issues.

“People tend to assume social issues are going to be high on the agenda here – and South Carolina does deservedly have a reputation as a socially conservative state,” said William Hauk Jr., an economics professor at the University of South Carolina’s Moore School of Business. But, he added, the candidates’ focus this year has been on “jobs, jobs, jobs.”


One of those candidates, Mitt Romney, has faced attacks from fellow GOP candidates over his time as CEO of private-equity firm Bain Capital. Texas Gov. Rick Perry accused Romney of practicing “vulture capitalism” at Bain, looting companies and eliminating jobs. Romney has also been criticized for seeming out of touch with average Americans, particularly after offering a $10,000 bet with Perry over a disagreement during a debate.

But that doesn’t necessarily spell disaster for the former Massachusetts governor.

“One would think that [in] a state with a relatively depressed economy, you might think Mitt Romney might not do as well as some other candidates,” Hauk said.

But although South Carolina may seem ripe for a “populist backlash,” there is also a longtime tendency to go for the perceived winner of the GOP nomination, Hauk added. That’s the person who can best defeat the current administration – a position currently occupied by Romney, who emerged from both the Iowa caucus and the New Hampshire primary victorious.


Another factor in the former Massachusetts governor’s favor is that aside from personal attacks on his business background, no Republican candidate has successfully sold himself as the savior of South Carolina's economy.

“I think all of them are saying the same thing,” said South Carolina Chamber of Commerce President and CEO Otis Rawl.  

South Carolina’s economists and business leaders are optimistic the economy will turn around this year. The state is already seeing strength in its housing market, which largely skirted the bust that led to the recession. Joey Von Nessen, a research economist at the Moore School, expects job growth to double to about 2 percent this year.

South Carolina’s economy was slammed by two national recessions. The state's fortunes were once driven by a booming textile industry, but increased import competition, changes in technology, and a statewide economic diversification caused manufacturing to decline in the 1970s. By the turn of the century, the state’s economy had shifted toward service and trade.

Then the recession of the early 2000s hit. South Carolina lost 24,574 jobs between March and November 2001. It was battered once again in the 2007-2009 recession. “South Carolina has experienced a double-whammy,” Bruce Yandle, an economics professor at George Mason University, wrote in a December report. 

Economists are looking to a rebirth of manufacturing to get the state back on its feet. South Carolina Commerce Secretary Bobby Hitt describes it as a “manufacturing renaissance.”

Auto companies will also help. The state has a strong cluster of auto manufacturers, including German auto maker BMW, which announced last week it would expand its South Carolina plant.  

But for now, some residents are just looking to get through the next four days.

“We’re optimistic about 2012 in spite of the elections, in spite of being bombarded by all this negativity,” said Frank Knapp, Jr., president and CEO of the South Carolina Small Business Chamber of Commerce, referring to campaign ads. “That’s going to be over here this Saturday and we can get back to being normal and having the rest of the world not pay attention to us.”

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