Brown attributes Toyota’s Texas move to the dynamism of capitalism


In his first public remarks on the shift of 3,000 Toyota Motor Corp. jobs from California to Texas, Gov. Jerry Brown chalked up the loss on Friday to “the creative destruction of capitalism.”

“I put the emphasis on creative,” Brown told reporters after an appearance at a business breakfast in downtown Los Angeles. “Change is inevitable.”

Toyota’s announcement on Monday that it would shut down its sprawling Torrance headquarters was seen as a political blow to the Democratic governor in the midst of his campaign for a fourth term.


It led one of his Republican challengers, former investment banker Neel Kashkari, to mock Brown for making fun of Texas Gov. Rick Perry’s effort to lure companies from California. Kashkari called Toyota’s departure the latest consequence of Brown’s “continued failure to support California job creators,” saying it was devastating to the livelihoods of middle-class workers.

Brown brushed aside such criticism, saying it appeared there was nothing he could have done to stop Toyota from consolidating operations in Texas, a move that company executives said had nothing to do with the business climate in California.

“There’s a fellow named Schumpeter who talked about the creative destruction of capitalism,” Brown said, alluding to the late Austrian American economist Joseph Schumpeter, who wrote of the incessant evolution of the economy’s structure amid changes in consumer goods, production methods and markets.

“If you’re totally static, you’re a dead economy,” Brown said. “Things are always moving.”

California’s $2-trillion economy, Brown said, reflects an abundance of resources in the nation’s most populous state.

“We do have Tesla,” he said. “We have an electric bus company from China. Certainly we would like more. But not every state can do everything. That’s why we have 50 states.”

Brown marveled at the sight of people looking at their iPhones as they were crossing the street on his way to the breakfast.

“Five years ago, that didn’t happen,” he said. “We didn’t have Apple when I ran for governor the first time. We certainly didn’t have Google.”

Brown, 76, who was first elected governor in 1974, struck similar themes in his remarks to several hundred people at the L.A. Area Chamber of Commerce breakfast to kick off World Trade Week. He called California “a very yeasty, very dynamic kind of place” with robust venture capital investment in technological innovations.

“It’s incredible how fast change occurs,” he said, “and what a challenge it is to keep up with it.”

He suggested the crowd remember California’s 19th century Gold Rush and the 1769 occupation of San Diego and Monterey by the Spanish Conquistadors.

“I like to look back as we look forward, combine innovation and change and imagination with remembrance and tradition and a sense of history,” he said.