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Jan. 29, 2013: Gov. Rick Perry delivers the state of the state address.

SAN FRANCISCO -- Declaring that his conservative state had knocked California off its perch as the nation's business leader, Texas Gov. Rick Perry on Monday bragged that the Golden State is now "looking at our backside."

A year after his failed presidential bid, Perry returned to the West Coast on Friday for visits to San Francisco, Silicon Valley and Los Angeles in an attempt to lure businesses to Texas following a statewide ad campaign last week. It's part of a push by low-tax states to entice California millionaires hit by recent tax hikes that have the state's wealthiest stomaching the highest income tax rate in the nation.

In a wide-ranging interview with this newspaper, the Republican politician fired return shots at California Gov. Jerry Brown, said his state capital of Austin is poised to become the "next Silicon Valley" and characterized California as a great state that has lost its way.

"Some time in the past, California became uncompetitive with other states because of their tax (and) regulatory policies in particular," said Perry, wearing a red tie, dress shirt, slacks and sneakers in a downtown San Francisco hotel room.

Perry did not disclose the names of the businesses he was meeting with and will not hold public events, but he was more than eager to pump up what he described as the Lone Star State's best qualities for business: low taxes, few regulations and lenient labor laws, which he said California lacks.


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"Twelve years ago, California wasn't looking over its shoulder," he said. "They're not looking over their shoulder now -- they're looking at our backside."

At 6.1 percent, Texas has a lower unemployment rate than California's 9.8 percent jobless rate, and several California companies such as Apple (AAPL), Facebook, eBay (EBAY), Visa and Chevron have chosen recently to expand or relocate offices to Texas, largely for economic reasons. But the Golden State is still leading the way in many other key areas.

Compared to Texas, California has a 3-to-2 edge in the number of companies, a higher percentage of residents with college degrees, a 21 percent higher median household income, a smaller portion of residents in poverty and median home values that are three times higher.

Perhaps most important, the Bay Area had $2.5 billion in venture capital funding in the fourth quarter of last year -- 12 times as much as the entire state of Texas.

"Silicon Valley has that quiet confidence. It's knowing you're No. 1 so you don't have to brag about it," said Carl Guardino, CEO of the Silicon Valley Leadership Group. "It doesn't take going out and trying to lure the scrappy startups or established enterprises to come here. They do that on their own."

After Perry last week launched 30-second radio ads in California in which he characterized the Golden State as a nearly impossible place to do business, Brown dismissed the campaign as "barely a fart," since the airtime was worth only $24,000.

"It was colorful," Perry said. "It was awesome. He got a lot of coverage. He helped the effort."

Perry also lambasted Brown's signature effort -- November's Proposition 30 tax increase, which helped balance California's battered general-fund budget -- and said Californians would come to regret passing the measure when they have less money left over.

The Texas governor emphasized that he liked California and its history -- he vacations here and visited during his run for the GOP nomination for president, he said -- but that the state was headed in the wrong direction because of what he described as a pro-tax, anti-corporate culture that has made the state's business climate "abysmal."

Brown's spokesman, Gil Duran, noted in an email Monday that "last year, Texas Instruments invested $2 million in an electronic design lab at UC Berkeley. Dell -- another Texas company -- expanded its operations in Silicon Valley. Samsung is building a cutting-edge research and development facility in San Jose, not San Antonio."

Duran added: "We hope Gov. Perry enjoys his visit to the Golden State."

Contact Mike Rosenberg at 408-920-5705. Follow him at twitter.com/RosenbergMerc.