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Tag Archives: Economic Growth

A case study in rightwing mendacity

29 Tuesday Oct 2013

Posted by Michael Bersin in Uncategorized

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Economic Growth, Forbes Magazine, Kansas, missouri, Rex Sinquefield, Sam Brownback, tax cuts, Tax policy

When I recently wrote about the Missouri GOP’s stubborn attempt to render unto Rex Sinquefield what – by virtue of his checkbook – is Rex Sinquefield’s, namely one more dreary iteration of their efforts to reduce or eliminate taxes for the wealthy, I also noted that a similar experiment seemed to be tanking in Kansas – even to such an extent that the popularity of Kansas GOP Governor Sam Brownbeck was in the pits.

Imagine, then, my amazement, when I learned via an opinion piece in The Kansas City Star that there are folks that think Kansas is in exemplary shape. None other than Missouri’s ever-generous billionaire, Rex Sinquefield, seems to have informed readers of Forbes Magazine that “a close look at the data backs up the economic projections of Brownback’s visionary leadership.”

So who’s right? Me? Or Rex Snquefield? The Star‘s contributing author, I’m happy to say, backs up my contentions about the state of Kansas, pointing out that, contrary to Sinquefield’s claims, the state’s economy is “tracking most of the rest of the nation” with “no discernable jolt upward.”

What interests me, though, is the way that Mr. Sinquefield, borrowing a tactic from so many movers and shakers on the right, takes a kernel of truth and by either twisting it or ignoring other equally relevant facts, begins to run a premature victory lap  – with a view to taking a similar lope around the track in Missouri once his pets in the legislature enact his long-sought after rich-man’s tax cut. Not for nothing was his Forbes article titled “How Kansas Governor Brownback Schooled Missouri On Tax Cuts, And Showed The Region How To Grow.”

Mr. Sinquefield asserts that “lower income tax rates have in fact stimulated the economy by reducing the price both of work and conducting business in the state.” Half true. The cost of work – what people get paid – did decrease. A Center for Tax Policy report cites “Bureau of Labor statistics that showed Kansas was one of 20 states where inflation-adjusted average weekly earnings of private employees decreased between May 2012 and last May.” This fact fits well with other reports that document conistent increases during Brownback’s tenure in the number of Kansans living in poverty.

What’s not so true is the part about lower income tax rates stimulating the economy. While some business organizations have upped Kansas “business-friendly” type of rating, based mostly on government policies rather than results, recent economic reports aren’t so glowing:

… another report shows Kansas lagging most states in economic growth from February to May and predicted it will trail in the next six months.

“Most states improved over the past quarter; only Alaska, Kansas, Nevada, Wisconsin, and Wyoming experienced declines,” said the State Economic Monitor report by the Tax Policy Center, which provides independent analyses of tax issues.

The report cited an economic growth measure produced by the Federal Reserve Bank of Philadelphia that combines non-farm employment, average manufacturing hours worked, the state’s unemployment rate and real wages.

The Philadelphia Fed also produces an index that measures future economic activity for six months, and again Kansas was among the bottom states.

If  you’re interested in going into Mr. Sinquefield’s claims in greater detail, you might be enlightened by what he fails to tell us, for instance, about the unemployment rate in Kansas. He reports correctly that Kansas unemployment fell from 7% in 2011 when Brownback took office to 5.8%, a decline of 1.2 percentage points. Not so spectacular, however, when you consider that during the same period, Missouri’s unemployment rate fell 2.1 percentage points. Apart from the fact that the Kansas jobless rate is actually currently 5.9%, what Sinquefield also fails to tell us is that the Kansas number reflects an increase in unemployment, from 5.5% in January. This loss of jobs occurred during a time that saw national unemployment numbers decreasing from 7.9% to 7.3%.

I don’t know about you, but when I took a closer look at Mr. Sinquefield’s claims and did a little research, I still wasn’t too impressed with Kansas’ economic growth record over the past couple of years. I will admit, though, that if I were naively reading Sinquefield’s Forbes encomium to Governor Brownback, I might think that he was on to something. Which takes us back to those polls that show Brownback tanking in Kansas. One lesson that one can draw from Mr. Brownback’s fall from popular grace is that folks learn from experience. Another lesson, though, seeks to account for the 30-some percent who still approve of his performance – and goes to show that if you jigger the numbers skillfully enough, you actually can fool some of the people all of the time.

The GOP spin machine refocuses on the economy in the wake of President Obama

26 Friday Jul 2013

Posted by Michael Bersin in Uncategorized

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Barack Obama, Economic Growth, economic policy, Medicaid cuts, Medicare cuts, missouri, Roy Blunt, Social Security cuts, Tim Jones, Warrensburg speech

Yesterday in Warrensburg President Obama tried to raise once again the issue of economic growth and its corollaries such as infrastructure investment, education and energy. The response from Missouri’s GOP politicians can only have been inspired by the fact that they’re secretly trying out their stand-up comedy routines before getting together and hitting open-mike night at some comedy club:

Back in Washington, Sen. Roy Blunt, R-Mo., said on the Senate floor that he was glad the president is visiting Missouri. “But these speeches sound an awful lot like the 2012 campaign speeches. I think we need to move beyond that. We need to not just pivot to the economy, but we need to stick with the economy.”

And:

“Our nation would be in a better place if, instead of spending all his time giving speeches filled with unrealized rhetoric about a better America, President Obama would actually work with Republicans to address the enormous problems facing our nation,” Missouri House Speaker Tim Jones, R-Eureka, said in a statement.

Somebody needs to remind Senator Blunt about the priorities of his GOP congressional colleagues. Although perhaps he’s aware of some big economic impact that adheres to outlawing all abortions at 20 weeks; votes to ban gender-based abortion (which is not a problem in the U.S.); 38 (I believe that’s the current count) purely symbolic votes in the House to defund Obamacare, numerous set-to’s over shutting the down the government over such a routine matter as raising the debt limit to cover the nations already incurred obligations (all spending approved by congress, by the way); this summer’s unending hearings over poorly manufactured and managed non-scandals, etc. and etc. (And, by the way, don’t forget, all this useless activity costs us money.)

As for Speaker Jones, he actually has the right of it. Of course, God himself couldn’t “work with” Republicans. After all, as we have learned over the course of the past few years, working with Republicans to achieve almost any goal means meekly bowing your head and meeting their every demand, and, God forbid, never, ever criticizing them for acting like thugs – all while ignoring the druthers of the folks who elected President Obama with a rather resounding majority to do just those things that throw the excitable GOPers into a frenzy of tantrums.

Both Senator Blunt and Rep. Jones seem to want us to think that the President is all talk and no action. However, I do seem to remember numerous initiatives that the president has put forward while the GOP has done nothing at all but obstruct and fulminate. Specifically in response to columnist Josh Kraushaar, Economist Jared Bernstein managed to point out the weakness of these types of GOP talking points when used to counter the President’s new offensive on the economy:

There’s no hint in Kraushaar’s column about the Jobs Act that Obama proposed in September 2011. Nothing about the economic plan he pushed in fall 2010, either. Nothing about Dodd-Frank. Nothing even about the proposals Obama made in his State of the Union this year, most of which he’s still repeating (and House Republicans are still ignoring). For that matter, nothing about Obama’s deficit-cutting over the last couple of years. […]

Not to mention that there’s a very screwy giving-speeches-and-passing-things focus here. What Obama did for the economy in 2009-2010 was mainly implementing the stimulus passed in early 2009. That’s really not ignoring the economy.

I don’t think any sane person could deny that we’re recovering from the Bush recession  – and from where I stand the President deserves the credit. And also from where I stand, the folks who deserve the blame for the fact that this same recovery is less vigorous than it could be are the folks who insisted on a series of stupid budget cuts that culminated in the sequester – which all by itself is costing us plenty in terms of growth:

Forecasting firm MacroEconomic Advisers has lowered its second-quarter forecast for GDP growth from 1.8% to 1.3%. That’s very weak growth that will probably hold back hiring and spending, and depress confidence. “The sequester is expected to slow growth this year, and largely accounts for the weak second-quarter growth and lackluster third-quarter growth,” the firm said in a recent report.

Of course I read yesterday that Senator Blunt thinks he has the solution to all our economic problems. While – to his credit – speaking out against a mind-numbingly stupid GOP threat to hold the debt limit hostage to an effort to defund Obamacare, he added:

… Where we ought to be now is – we need more spending cuts. They need to be probably on the mandatory side rather than the discretionary side. I think that’s the formula that obviously allows us to move forward most easily here.

You know what that means. If the President decides, apropos Speaker Jones wishes, to “work with” Republicans, it will mean cuts to Medicare, Medicaid and Social Security. Just what the GOP has wanted all along.

Senate Bill 26: Everybody knows that robbing the poor to pay the rich is a bad idea

09 Tuesday Apr 2013

Posted by Michael Bersin in Uncategorized

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Tags

border war, Economic Growth, missouri, regressive taxation, SB26, Tax policy, tax reform

There’s been lots written about why Missouri Senate Bill 26 is a bad idea (some examples:  here, here and here). Most obviously, it offers big tax savings to  corporations and other wealthy Missourians; these savings, however, would be partially paid for by raising sales taxes, eating up a disproportionately larger percentage of the income of poor and middle class folks and exacerbating income inequality. The remaining revenue losses would have to be made up by cutting services offered by the state. The problems with the proposal are obvious while the promised benefits are nebulous since plenty of evidence indicates that lowering or eliminating income taxes isn’t the boon to growth that the right claims it is (see, for instance here and here).

It’s pretty clear who benefits from this type of change and who doesn’t (hint: most of us don’t do so well), so Missouri GOP pols are attempting to justify this giveaway to cronies and corporate sponsors by inciting fears of a border war with Kansas, claiming that Missouri businesses will relocate to take advantage of the no-tax climate on the other side. While it is not at at all clear that there would be significant business flight, it is very clear that the resulting loss of revenue would wreak havoc on Missouri’s quality of life and, arguably, on overall prospects for increased economic growth.

SB26 obviously isn’t too smart from an economic perspective, but, not surprisingly, it may not be too smart politically either. The vaunted (by anti-tax GOPers, at least) Kansas experiment seems to be turning off voters there in large numbers:

Brownback has a negative -15 job approval rating, with 37% of Kansas voters approving and 52% disapproving of his performance as governor. 72% of moderates disapprove of his performance as well as 30% of Republicans and 66% of independents.

Brownback’s plan to phase out the state’s income tax is almost as unpopular as he is, with 48% of voters opposed and 37% supportive. 65% of moderates and 56% of independents oppose the plan. Even 34% of somewhat conservative voters and 28% of Republicans are opposed to the proposal to overhaul the income tax.

In Louisiana public disapproval has forced governor Bobby Jindal to jettison a similar, regressive tax proposal:

… Only 27 percent of Louisiana voters supported the plan in the latest SMOR poll versus a whopping 63 percent opposed. The idea didn’t even garner majority support among Republicans.

 

Also likely to be of interest to state GOPers who want to hang onto their legislative majority, Jindal’s overall popularity, like Brownback’s, is also tanking:

… . His approval rating plummeted to 38 percent in a poll last week by the non-partisan Southern Media Opinion & Research, down from 60 percent just a year ago. In an ominous sign for national Republicans, the immediate cause is a sweeping economic agenda with strong parallels to the House GOP’s latest budget.

It’s a funny fact that several of the governors who rode the Tea Party bandwagon to electoral success are alienating voters now that they are trying to enact the extreme right-wing economic policies espoused by the more cogent Tea-Partiers. Eight of the ten governors who are currently below sea level in terms of their approval ratings fall into this category. Perhaps there’s a lesson here for those among Missouri’s GOP lawmakers who have the requisite discernment to see it. Since they demonstrably don’t care about the public welfare – just consider their anti-Obamacare Medicaid expansion tantrum if you doubt this claim – perhaps self-interest might keep them from the type of folly embodied in bills like SB26.

 

Missouri’s Bridges: Another reason to send the GOP packing

09 Sunday Sep 2012

Posted by Michael Bersin in Uncategorized

≈ 2 Comments

Tags

deficient bridges, Deficit reduction, Economic Growth, jobs, missouri, The American Jobs Bill, toll bridges

During the Democratic convention President Obama noted that one of the ways that we need to invest in our future – while creating jobs in the process – would be to address our aging infrastructure. I think that he even mentioned bridges which ought to be a big deal for Missourians since we have hundreds of bridges that are disasters waiting to happen.

I invite you to take a look at this interactive map at SaveOurBridges.com. The little tags that spring up when you run the cursor over the map represent bridges that are both “structurally deficient” and “fracture critical.” To give you an idea of what this means, the I-35W Bridge in Minneapolis that collapsed a few years ago, killing 13 and injuring 145 people, had been determined to be structurally deficient and fracture critical. When you look at the map, you will notice that Missouri is almost obscured by the number of symbols indicating bridges in a similar state. There are so many deficient bridges that you have to keep zooming in closer and closer in order to make out specific problem bridges.  

Most of these decaying bridges carry fewer than 24,000 cars a day, but the traffic on two bridges in the St. Louis area and one in Kansas City average between 25,000 and 75,000 cars daily. I don’t know about you, but this sort of statistic makes me very nervous. According to Forbes

The sad state of America’s bridges is likely to make an already challenging fiscal future still more so.  It will cost an estimated $70.9 billion to address the current backlog of deficient bridges, according to FHWA’s 2009 statistics.  This estimate may prove wildly conservative.

While the size of this investment may seem massive, the political consequences of delay seems likely to be so substantial that one would suspect the Uncle Sam to pony up whatever funds were necessary.  Surprisingly, this does not appear to be happening at anywhere near the scale needed to avoid more catastrophes like the one that took place in Minnesota.

Unlike William Pentland, the Forbes contributor whom I quote above, I am not surprised at all by government inaction. Certainly since the cooperation adverse Tea Party Republicans who elbowed their way into the congress in 2010 have been banging the deficit-über-alles, our-way-or-the-highway drum, it seems as unlikely that we will address our infrastructure problems as it is that we will effectively deal with our employment problems – even though renewing and maintaining our aging bridges would go a long way toward meeting both needs.  

This is not to say that we won’t get some new bridges, although we may have to wait until there are a few more horrendous events like the Minneapolis bridge collapse. However, given the GOP reluctance to commit to using government to build and maintain infrastructure, it may be private investors who take up the slack – which will probably be just fine with the original crony capitalists. Get ready to say hello to toll bridges since politicians, both Democrats and Republicans, seem to lack either the clout or, often, the intestinal fortitude to take on the anti-tax, deficit cutting claque in order do the right thing. So it looks like we will end up paying over and over for the right to get from one place to another. Time Magazine‘s Barbara Kiviat summarizes some of the arguments against turning our national infrastructure over to private interests:

… Tolls often skyrocket under private owners, though with the blessing of elected officials, who avoid the political costs of raising tolls or taxes themselves. That’s how privatized roads deliver double-digit returns for investors and often lead to upgrades like electronic tolling. But there are other devils lurking in the details, like noncompete clauses that may prevent transportation agencies from building new roads, or the inability to use roads for economic development by, say, adding a new exit to attract businesses. Some officials get queasy about locking themselves into long leases; Colorado officials already regret offering a 99-year lease for the Northwest Parkway. …

It is likely that, no matter what, we will see a few more private-public partnerships to build new bridges in the future. We don’t need to totally surrender our national infrastructure to the big-money boys, however; there is another way.  The President’s jobs bill, The American Jobs Act (pdf), allocates $27 billion for transportation infrastructure programs, including bridge and highway repair.

We’d get new jobs and new bridges. What’s not to like? All we’ve got to do is say no to Romney/Ryan and vote the rest of the GOP bums out. And guess what? If we’re finally able to get the level of public infrastructure spending that we need to boost the economy, we’ll speed up the recovery overall, increase tax revenues and we will finally be in a real position to deal with deficit reduction in a sane, reality-cognizant fashion.

Hartzler tries to hide the crazy behind jobs talk

10 Tuesday Apr 2012

Posted by Michael Bersin in Uncategorized

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Tags

birtherism, Economic Growth, job creation, missouri, Vicky Hartzler

In an effort to get herself out of the deep you know what Vicky Hartzler stepped in when she tried to fan the birtherism flames among her more receptive constituents, she resorted to what has become the standby of a GOP that wants to hide its real proclivities. She denied interest in anything less lofty than jobs. According to her press aide, Hartzler “is focused on job creation and the economy – not on the birth certificate controversy.”

My response to this? Well and good. Since Hartzler is focused like a laser on the economy, I will expect to hear her touting the President’s job creation record any day now. This chart tells us that it’s not been nearly as bad as she and her GOP pals keep trying to claim:

I see slow but relatively steady job growth. According to most economists, the first six months of Obama’s presidency reflects the mess he inherited from George Bush’s toxic mixture of trickle-down economics and deregulation, but with the implementation of the American Recovery and Reinvestment Act, a.k.a., the stimulus, we began to see improvement that has continued, albeit slowly, to the present day. Since 2010, the private sector has added about 3.9 million jobs.

Here, however, is another relevant chart for Hartzler to chew on:

Seems like unemployment figures might have been even better were it not for the loss of public sector jobs. McClatchy reports that since 2010, some 485,000 government jobs have been cut. These job losses are directly attributable to the GOP’s hatchet job on the budget, both at the federal and state levels.

As far as I can remember, Vicky’s been all for the austerity budgets with their destructive cuts to federal spending and down,down, down on the stimulus.

Given these facts, I think I’d like Hartzler to stay focused on the President’s birth certificate and forget about the economy. She’ll probably do a lot less harm that way.  

How to celebrate Earth Day

21 Wednesday Apr 2010

Posted by Michael Bersin in Uncategorized

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Claire McCaskill, clean energy, Earth Day events, Economic Growth, jobs, Kit Bond, missouri, Repower America

So how can Missourians celebrate Earth Day tomorrow in a way that will have real impact? The answer is easy if you live in or near St. Louis or Kansas City: join Repower America and other “clean energy patriots” at a rally outside Claire McCaskill’s offices in those two cities (find information about St. Louis rally here; Kansas City information is here). Alternatively, Repower America will also host call-in events in Kansas City and St. Louis  (click on the cities to volunteer or get information).

At the call-in events, you can volunteer to do outreach to other Missourians and enlist them to, in turn, contact Senators McCaskill and Bond, and tell them how much they want them to support strong clean energy legislation. If you just want to contact one of our senators to deliver the message yourself, you can phone this Repower America number and ask to be patched through to either senator: 1-877-9-REPOWER (9-737-6937).

Why are these events important? We can take it as a given that Senator Bond is unlikely to change his stripes and support meaningful clean energy legislation any time soon, but it is still important for him to hear that many of his constituents do want congress to limit carbon emissions and invest in clean-energy jobs for Missouri.

As for Senator McCaskill, we have recently seen that she may be beginning to get the message that clean energy can mean growth and jobs for Missouri, as well as being essential to continued American competitiveness since other countries are rapidly jumping on the band-wagon. Nevertheless, she needs to know that we support her shifting position, and that we will have her back if she follows through and does what’s right – which includes measures to restrict carbon emissions.

In case you yourself want more reasons about why clean energy is important to Missourians specifically – apart from the general “save the world” issues involved with climate change – just take a look at any of these three fact sheet prepared by Repower America, “Clean Energy Potential in Missouri,” “Clean Energy Jobs in Missouri,” and “How Clean Energy Will Help Missouri’s Farmers.” And then, if you are able, make it on over to one of the Repower America rallies tomorrow or volunteer for one of the phone-in events right away.  Happy Earth Day!

Time for a big piece of humble pie

30 Saturday Jan 2010

Posted by Michael Bersin in Uncategorized

≈ 2 Comments

Tags

Blaine Luktemeyer, Economic Growth, missouri, recession, republicans, Roy Blunt, Todd Akin

Missouri’s Republican pols have been vociferous in condemning the stimulus package enacted last spring. From quibbling about the numbers of jobs saved, to viciously attacking the program because all our problems have not gone away a few scant months after our economy nearly bottomed out, their rhetoric has been uniformly shrill and accusing. For instance, according to Todd Akin, the stimulus was a “tragic waste of taxpayer money,” a sentiment echoed by Blaine Luetkemeyer who declared the “so-called stimulus package” to be a “catastrophic failure.” For Roy Blunt, the stimulus was an “absolute outrage.”

You get the idea – I could produce dozens of such quotes – pick your Republican and I can promise he or she put some ugly words out there about the stimulus – although, it does bear noting that Blunt and Lutekemeyer did manage to hold their tongues when they were hustling to take credit for stimulus awards to their districts – but that’s another matter altogether.

It is, however, just this excess of partisan bile that made it all the sweeter when we learned today, that the U.S. economy grew during the last quarter at the highest rate in six years, a result that many are attributing directly or indirectly to the stimulus effects:

This broad-based rise in GDP was surely fueled in part by the tax cuts and investment spending in the Recovery Act and other rescue actions, but some appears to be the result of private sector demand returning

According to Mark Zandi, a former economic advisor to John McCain, the “stimulus was key to the 4th quarter.”

Hard times are not gone yet – but things are definitely looking up.  As the President observed after noting that the economy had contracted 6.4% in the first three months of last year:

You’ve seen a 12 percent reversal in the course of (last) year. This turnaround is the biggest in three decades, and it didn’t happen by accident

So when do you expect that we will hear the likes of Akin, Luetkemeyer and Blunt admit that they were wrong?  And, even more to the point, when will Missourians tell them and the rest of their gang that trash talk and tantrums just won’t do it anymore – we need them to get on the bandwagon instead of trying to overturn it.

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