Monday, December 31, 2012

Your Water But Not Your Name

Milwaukee is a great place to extract water from. But, sorry, the Milwaukee Water Council doesn't want anyone to know that water has anything to do with Milwaukee.

As John Schmid reported, "The work of the Water Council has become global in its nature and the organization wants to jettison anything that smacks of provincialism," Executive Director Dean Amhaus said. Hence, they've dropped Milwaukee from the formerly titled Milwaukee Water Council.

Yes, all the companies that are members of the Water Council, those businesses which have benefited from Milwaukee's water, those same ones whom want see the "water hub" idea take-off, they just don't want to mention or give any indication that they are actually in Milwaukee.

Let's not forget this idea of a Milwaukee "water hub" and it's transformational economic powers are dubious. Nonetheless, being a Milwaukee initiative involving Milwaukee water, the fact that it's located in Milwaukee should be one of the focal points. Especially if the initiative is being sold as a catalyst for economic development in the Milwaukee area.

As a 2009 University of Wisconsin-Milwaukee Center for Economic Development report explained:
In 2009, UWM also launched the second key initiative in its entrepreneurial aspiration to become the driver of economic development in Milwaukee: a School of Freshwater Sciences. During the preceding two years, Milwaukee’s civic leadership had coalesced behind a regional economic development strategy, led by 69 business executives who organized something called the “Milwaukee 7 Water Council,” to “brand itself as the global capital of freshwater research”...
Curiously, no one in Milwaukee has done the comparative research on the water sector in other metropolitan areas that would be necessary to confirm whether a uniquely large “cluster” of water companies is located in the region...
Of the 40 global water companies listed by a Goldman Sachs report as generating the highest revenues none have their U.S. headquarters in Milwaukee...
What about the locations of all U.S. plants and offices –not simply headquarters-- for global “top 40” water companies? Over 50 metro areas are home to at least one U.S. plant or office of the global water “top 40.” What’s more, as in the case of headquarters noted above, the vast majority of these facilities are located in the suburbs, exurbs, and small towns of metropolitan areas, generally not in the central cities. Thus, as suggested earlier, this suggests that the economics of clustering and agglomeration may not be at a premium in the fragmented water technology industry, and that no one place is likely to emerge as a“Silicon Valley” of water...
The Milwaukee region supposedly is already home to a vibrant and growing water sector, comprising somewhere between 76 and 120 “water-related” companies (including local branches of five of the world’s 11 largest water companies). According to water boosters, these numbers are larger “than in any other city in the United States”; they confirm that Milwaukee is “already a leader in water technology”; and they confer on the region significant “first-mover” advantages in the race to become the “Silicon Valley” of water...
But, whether we look at headquarters locations, offices and plants, patents, or certain occupations, the Milwaukee region is hardly a “unique” presence in the industry, or even a “first-mover” in attempting to promote water technology as a local economic development strategy... 
Several regions, in the U.S. and abroad, do seem to have a leg up in growing and attracting water technology companies, but the industry doesn’t appear to exhibit a clustering that remotely resembles a “Silicon Valley.” And to the extent that there is a nascent Silicon Valley of water out there, Minneapolis, Toronto, Israel, or Singapore all seem like better bets at this point than does Milwaukee. 
So, we've gone through all this trouble and money to brand Milwaukee a "water hub," but now the powers that be would like everyone to just focus on the water and forget about Milwaukee. That's not right. 

Sunday, December 30, 2012

A Majority Rule Institution



"To give a minority a negative upon the majority (which is always the case where more than a majority is requisite to a decision), is, in its tendency, to subject the sense of the greater number to that of the lesser...A sixtieth part of the Union, which is about the proportion of Delaware and Rhode Island, has several times been able to oppose an entire bar to its operations. This is one of those refinements which, in practice, has an effect the reverse of what is expected from it in theory. The necessity of unanimity in public bodies, or of something approaching towards it, has been founded upon a supposition that it would contribute to security. But its real operation is to embarrass the administration, to destroy the energy of the government, and to substitute the pleasure, caprice, or artifices of an insignificant, turbulent, or corrupt junto, to the regular deliberations and decisions of a respectable majority. In those emergencies of a nation, in which the goodness or badness, the weakness or strength of its government, is of the greatest importance, there is commonly a necessity for action. The public business must, in some way or other, go forward. If a pertinacious minority can control the opinion of a majority, respecting the best mode of conducting it, the majority, in order that something may be done, must conform to the views of the minority; and thus the sense of the smaller number will overrule that of the greater, and give a tone to the national proceedings. Hence, tedious delays; continual negotiation and intrigue; contemptible compromises of the public good." ~ Alexander Hamilton, The Federalist No. 22


Saturday, December 29, 2012

Tax Collections At Historically Low Levels

The federal government is only collecting 17% of GDP as tax revenue, a historically low level.

Friday, December 28, 2012

A Fractured Process

The Journal Sentinel reports, "A new study funded by the petroleum industry says Wisconsin firms employ 20,000 people supporting the unconventional oil and gas business - meaning sand mines, largely. The sand from western Wisconsin is used by drilling companies in North Dakota and other states to unlock underground natural gas and oil supplies in a controversial practice called hydraulic fracturing, or fracking."

Go figure. The industry that gains from fracking has released a study showing how wonderful it is.

Walmart employs people. Sport stadiums employ people. Yet, these are low-wage jobs, usually lacking health care and retirement plans. The mantra of "It creates jobs!" is short-sighted and overblown. Regarding fracking, if those jobs destroy land, water, and leave behind a barren wasteland, it's not really a long-term jobs plan. It's a short-term money grab for the parent company pillaging and plundering the land. Not to mention the negative public health consequences for residents. So yeah, again, not really a good nor sustainable jobs plan. And, definitely not a good plan for a state that prides itself on the natural environment and the beauty and purity of the land.


“Every year, large areas are continually becoming unfertile in spite of efforts to grow vegetation on the degraded mined land.” wrote Mrinal Ghose in the Journal of Scientific and Industrial Research.

As Ellen Cantarow reports, "Boom times for hydraulic fracturing began in 2008 when new horizontal-drilling methods transformed an industry formerly dependent on strictly vertical boring. Frac-sand mining took off in tandem with this development. “It’s huge,” said a U.S. Geological Survey mineral commodity specialist in 2009. “I’ve never seen anything like it, the growth. It makes my head spin.” That year, from all U.S. sources, frac-sand producers used or sold over 6.5 million metric tons of sand — about what the Great Pyramid of Giza weighs. Last month, Wisconsin’s Department of Natural Resources Senior Manager and Special Projects Coordinator Tom Woletz said corporations were hauling at least 15 million metric tons a year from the state’s hills. By July 2011, between 22 and 36 frac-sand facilities in Wisconsin were either operating or approved. Seven months later, said Woletz, there were over 60 mines and 45 processing (refinement) plants in operation. “By the time your article appears, these figures will be obsolete,” claims Pat Popple, who in 2008 founded the first group to oppose frac-sand mining, Concerned Chippewa Citizens (now part of The Save the Hills Alliance)."

There are better ways to grow an economy. Much better ways than destroying the land around you. Let's move toward a sustainable, equitable, and safe future for Wisconsin and it's residents. Let's tell the hydraulic fracturers to frack off.

For Further Reading:
Clintonville Booms Caused By Fracking?
The Evolving Truth About Fracking For Natural Gas
How Rural American Got Fracked
In The Name Of Fracking

The Legalized Bribery That Is Sport Subsidization

A great article on the "system-gaming moocher class, an entitled, irresponsible, parasitic piglet subset, lazily suckling from the public teat, pulled up by shiny new bootstraps purchased with government giveaways, forever hiding in plain sight," otherwise known as sport subsidies.

As Patrick Hruby writes, "According to Harvard professor Judith Grant Long and economist Andrew Zimbalist, the average public contribution to the total capital and operating cost per sports stadium from 2000 to 2006 was between $249 and $280 million. A fantastic interactive map at Deadspin estimates that the total cost to the public of the 78 pro stadiums built or renovated between 1991 and 2004 was nearly $16 billion."

How does all this (continue to) happen? Especially considering our supposedly pinched budgets and ever-burgeoning fiscal constraints, why do we continue to subsidize sport millionaires? Hruby explains, "Team owners ask for public handouts and threaten to move elsewhere unless they get them, pitting cities against in each other in corporate welfare bidding wars -- wars rooted in the various publicly granted antitrust exemptions that effectively allow sports leagues to control and maintain a limited supply of teams to be leveraged against widespread demand."

Sound familiar? These are the same tactics (build us a stadium or we're leaving town) which were applied to Miller Park for the Brewers and which are being used to strong-arm the public into supporting a new Bradley Center for the Bucks. 

Go read the entire article - Cut Welfare To Sports - to find out more about the land giveaways, infrastructure freebies, tax breaks, and other government handouts the public provides to sport millionaires.

Wisconsin Government Spending



Saturday, December 22, 2012

Wisconsin's Spending Problem: Corporate Welfare

According to data collected by the New York Times for their series, United States of Subsidies, Wisconsin spends $1.53 billion per year on incentive programs. (Almost 5% of the $66 billion biennium budget.)

Remember Scott Walker's claims of a $3.6 billion shortfall for the two-year budget cycle during his campaigning? Simply ending corporate welfare "incentives" over a two-year period would wipe out almost all of this supposed shortfall.

Weekend Reading

As Companies Seek Tax Deals, Governments Pay High Price
The Big Lie About The Entitlement State
Cash-Rich Companies Being Subsidized By Tax-Poor Governments
How State Aid To Cities Has Plummeted
$100 Million In Business Tax Credits, But At What Cost?
Public-Private Partnerships Extract Private Profit From Public Projects
Revenge Of The Reality Based Community
The 6 Craziest State Gun Laws
The 12 Biggest Companies Paying Workers The Least
12 Facts About Guns/Mass Shootings In The U.S.
When Government Does Things Better Than Private Enterprise
Who Broke America's Jobs Machine?
Why Isn't Obama Demanding Corporate Welfare Cuts?

Saturday, December 8, 2012

Wisconsin Corporate Blackmail

From Bruce Murphy, "Wisconsin, it turns out, is also a paradise for companies seeking handouts, as a ground-breaking story in the New York Times documents. The story’s online tracker allows you to check any state, which shows Wisconsin spends $1.53 billion in taxes per year on incentives for business. That equals 10 percent of the state’s annual budget and costs $268 per per person. Wisconsin, land of the supposedly bad business climate, ranks ahead of 33 other states and the District of Columbia in per-capita payments to business."

Go read Murphy's entire Land of Corporate Blackmail article.

Thursday, December 6, 2012

It's A Scandal! It's A Outrage!

Following up on some earlier thoughts about Milwaukee's (well, really the MMAC's) fascination with Oklahoma City (OKC) and their new basketball stadium, partially funded by a 1 percent sales tax.

An additional 1% on the sales tax to pay for infrastructure and other civic investments is a worthy idea, used by OKC to finance some of their new projects. (Taxpayers have already voted in favor of such a tax to support our parks.) But, is a basketball arena the first priority of such spending? Considering transportation, water, sewer, education, health care, and a host of other more immediate needs, is a sport venue the crucial link to fostering explosive growth?

What we have here is a self-interested cabal throwing everything they can think of at taxpayers hoping something finally persuades them into thinking that subsidizing a sport arena is a great investment (again).

Sports are fun, stadiums are economic catalysts, Herb Kohl is a good guy, we need the Bucks to be a "big league" city, etc. Now they're surveying the country, identifying the most recently completed basketball stadiums, and if that city or region is experiencing growth, abracadabra - the stadium is a defining element of that growth, and yet another reason why Milwaukee should get on this bandwagon.

OKC is growing ... and they just built a basketball stadium ... ergo, Milwaukee needs to get with the program if they want to experience growth. Nevermind our lack of an advanced rail system (when compared with other cities), shrinking bus routes, continual cuts to our parks, crumbling bridges and roads, declining schools, to name a few. For the majority of residents (businesses and individuals), these needs far outweigh a sport stadium.

For Further Reading: 
Are Basketball Arenas Catalysts Of Economic Development?
As Stadiums Vanish, Their Debt Lives On
Basket Case 
Buck The System 
Buck You 

City Lays Off Workers While Giving Millions To Pro Hockey Team
Economic Engine Or Albatross? 

Economic Of Sports Facilities & Their Communities
5 Cities Financing Pro Stadium Boondoggles
Growth Effects Of Sports Franchises, Stadia, And Arenas
Is There Anything A Stadium Can't Solve? 

NBA Arenas Lousy For Local Economies
Overblown Bradley Center Impacts 

Professional Sports As Catalysts For Metropolitan Economic Development
Selig Defends Taxpayer Subsidies For Stadiums
Should Cities Pay For Sports Facilities
Stadiums Don't Bolster Local Economies
Stadium Swindle
Will Herb Kohl Blackmail Milwaukee?

Best State Pension System: Wisconsin

21 States' Pension Systems Not Fiscally Sound

Pundits, talking-heads, politicos, and other supposed experts warning about an impending Wisconsin pension crisis are merely using false information and scare tactics in an attempt to eviscerate the pension system. Plain and simple. This is another one of those "entitlements" (anything having to do with a fair society, the social contract, or shared prosperity - all of which, Republicans hate) the anti-government zealots complain about with the hope that some of the smears stick.

This situation is very similar to the debt ceiling theater (here, here, and here). Money has already been earmarked for a certain purpose - budgetary items/programs or employee compensation. Creating some phantom ceiling doesn't mean the liability goes away. Because varies entities may have taken pension money and spent it on other purposes, this does not absolve their responsibility to pay previously contracted pension obligations.

As David Cay Johnston explains, "The fact is that all of the money going into these plans belongs to the workers because it is part of the compensation of the state workers. The fact is that the state workers negotiate their total compensation, which they then divvy up between cash wages, paid vacations, health insurance and, yes, pensions. Since the Wisconsin government workers collectively bargained for their compensation, all of the compensation they have bargained for is part of their pay and thus only the workers contribute to the pension plan. This is an indisputable fact."

Some of these pundits and politicos don't want you to have a stable retirement. Well, that's implicating them too much. They really just want that money - in the form of tax cuts, subsidies, and giveaways - for themselves. As far as your retirement is concerned, they really don't care.

Pensions (public & private) are in trouble because slippery mayors, duplicitous governors, gluttonous politicians, and greedy business owners have diverted funds (compensation) away from pension accounts and into other uses - plugging budget holes, subsidizing business parks and sporting arenas, constructing more and more roadways, and even for new vacation homes.

You're going to see more articles and more pundits bloviating about this "we must transform the pension system to save it" talking-point in the near future, feel free to laugh at them, but make sure you're not swept up into their misguided rhetoric.

For Further Reading:
Deferred Wages
More Bad Pension Reporting
Pension Petulance
Politicking With Pensions
Recoiling Retirement
Retirement Revisionists
Scott Walker Is Coming For Your Pension

Monday, December 3, 2012

The Economic Trail Of Tears

The Business Journal of Milwaukee recently ran a handful of articles regarding a revival in Milwaukee, an new arena being a part of that, and Oklahoma City (OKC) possibly being a roadmap for the whole process.

Oklahoma City has recently developed a river walk, completed a large hotel development, and built a stadium to attract an NBA team (the OKC Thunder). I guess we're supposed to imagine Milwaukee doesn't already have these, or that duplicating similar venues will lead to greater growth?

Or, maybe we can turn back the clock and reverse our history. Milwaukee is an older city (1846) than Oklahoma City (1889). Newer cities, like developing countries, are experiencing higher rates of growth than older cities. Add in the warmer climate and the heavy influence of Big Energy (mostly oil & natural gas) and you pretty much have to whole story behind OKC's growth. It's not because of some magical development plan based on the public funneling more money to private projects.

Oklahoma City actually has a larger share of its workforce employed by the government - 15.1% versus  13.2% in Milwaukee.  Should Milwaukee expand government? I'd love to see the MMAC recommend that.

20.8% of Oklahoma City residents have no health insurance coverage, in Milwaukee, it's 15.6%. For that 5 or so percent of the population in OKC with no health care coverage, would they claim a better quality of life?

The rental vacancy rate on OKC 8.1%, in Milwaukee 3.5%. Median home value in OKC $131,100, in Milwaukee $133,800. Median rent in OKC $720, in Milwaukee $753. It appears the value (and occupancy) of the built infrastructure is holding it's own compared with OKC.

The article relies on quotes from Greg Marcus, CEO of Marcus Corporation, for the inside story on Oklahoma City. He developed a hotel there, so he knows. Marcus claims Kohl's Corporation may have moved to downtown Milwaukee if the quality of life had been better. Couldn't this excuse (quality of life), to some degree, plausibly be used every time one location is chosen over another? And, by doing what? What does he recommend that Milwaukee, imitating OKC, do to improve the quality of life?

Marcus elaborated, "If you don't invest in your product, you don't get customers. You need to have a product that is so compelling and invest in infrastructure."

Yet, these same omnipotent business leaders also don't want to have to pay the taxes that pay for improvements in infrastructure.

None of this means there isn't anything to learn from OKC. But sound economic development isn't just latching on to the latest rising star and reciting their most recent achievements as a best practices guide.

Thursday, November 22, 2012

Republican Shrinkage

Republicans often repeat the line, "Most Americans want a smaller government."

A classic example of Republicans getting an inch and taking a mile.

Most people simply want efficient provision of services. The number of public workers is not important to most taxpayers. The quality of service per tax dollar is what concerns taxpayers most.

The idea that simply shrinking government for the sake of shrinking government is wanted and/or somehow optimal is false. Taxes, as a share of income, are at their lowest point in 60 years. It's difficult to argue government is wasteful when they have been continually doing more with less decade after decade.

And, whether the service is administered at the federal or state/local level doesn't really matter to most taxpayers. This distinction matters most to the politicos trying to maintain their fiefdoms. Taxpayers just want the service/program - regardless of which agency (state or federal) provides it.

Social Security, Medicare, police and fire protection, sewers, water, garbage collection, snow removal, roads and highways, trains, unemployment insurance, the court and judicial system - people want these services provided fairly and efficiently, they don't care which level of government performs the service. (Today - Thanksgiving - would be a good day to reflect on these programs which we collectively provide for each other.)

Republicans merely cling to this talking-point (we must shrink government) because it positions well alongside their never-ending "bad government" war chant. When it comes to the public sector, according to Republicans, less is always better.

Yet, for most citizens, less government means more inequality. Remember this the next time you hear some conservative blathering on about big bad government. The more government declines, the less services and programs (listed above) they can provide, and thus the quality of life of most citizens also declines.


We Need A Stronger Labor Movement



Monday, November 19, 2012

Comedy Classics

Truly Unfortunate

Scott Walker was recently in California at the Ronald Reagan Presidential Library & Museum giving a speech about his plans for Wisconsin. The Reagan Library, where the biggest Republican whores go to grovel before their sugar daddies and kingmakers. Yes, what better place to start talking about future Wisconsin legislative plans than in California? But, as they say, you've got to go where the money is.

"We think if we want to continue the economic success we've had over the last year and a half, again one of the best ways to do this is to put money back in the hands of entrepreneurs, more money back in the hands of small business owners, more money back in the hands of our consumers...we're going to continue to lower our property taxes, and we're going to put in place an aggressive income tax reduction and reform in the state of Wisconsin because we believe we can continue to be one of the leaders in the country, not just in reform but ultimately in results." said Walker.




Economic success? Since Walker took over, Wisconsin is near the bottom in job growth among the states.

The Walker plan includes: tax cuts (of course), making Wisconsin's voucher program for private schools available to more students (even though research has shown the program doesn't produce any better results), and to eliminate "unnecessary" state regulations (vague, as usual). Basically, tax cuts and deregulation, alongside funneling more public dollars to unaccountable semi-private entities. Sound familiar? We've heard these recommendations from Republicans for decades now. What has it got us? Stagnant wages, volatile retirements, expensive health care, and increasing inequality.

"It's unfortunate he's going to try to continue to go down this war path of ideology instead of actually trying to address the real problems that we've got. It looks like he's putting his donors above his voters," said Chris Larson.

Truly unfortunate.

Saturday, November 17, 2012

Bill Maher Dance Studio

More Bradley Center Bull

The Journal Sentinel has run yet another editorial pushing for a new basketball stadium. Yes, in the wake of a recession second only to the Great Depression, the thing we need most, right now, is a new sport stadium.

Even the Journal Sentinel's own Don Walker previously wondered how Bradley Center officials and boosters can have it both ways - the arena is uncompetitive and doesn't generate sufficient revenues, yet it is also is a huge economic driver for the region.

The editorial uses Miller Park as an example (to highlight the often repeated stadium subsidy threat), "Without a new Miller Park, the Brewers would not be in Milwaukee today. Now, with new ownership and a new stadium, the team brings in more than 3 million fans a year." The impressive sounding 3 million attendees (closer to 2.8 million, ranking 11th in MLB for 2012, down from 7th place in 2011) doesn't seem as impressive when you express it as 81 games with roughly 35,000 attendees per game (in a stadium that holds just under 42,000; a 17% vacancy rate).

And, so what? If the Brewers weren't in Milwaukee, we wouldn't have a baseball team. That's it. No baseball team - boo hoo! There isn't a single economic indicator the boosters can point to which shows Miller Park has had a positive economic effect on anything but the owners' and players' wallets.

Yet, without any evidence, without anything to back up the claim, the editorial gushes, "A new arena could spark economic development downtown, especially in the Park East corridor."

The editorial even eludes to the substitution effect (consumers spending at one place rather than another), "The Bucks need to have a plan in place to construct a new state-of-the-art facility by 2015 - a new arena that would be a year-round draw for downtown Milwaukee." The new stadium will end up being a draw from non-subsidized establishments, venues, and other entertainment options. Sure, more people may attend games for the first few years of the new stadium, but this will be due to the decreased patronage at other local establishments. It would be nice if the Journal would explain why we should be picking stadiums as winners over other restaurants, bars, and entertainment options.

The editorial went on to state, "[Herb] Kohl will not bear the entire cost of a new facility, and he shouldn't." A most perplexing line. The whole consideration of a new stadium is for the primary purpose of housing the Bucks basketball team - Herb Kohl's team! I would love for the Journal Sentinel to elaborate as to why the public needs to fund private enterprise. Just because the public is allowed to purchase tickets to an event at an establishment, that doesn't really make it a "public" facility (actually a state-owned building operated by a quasi-private board). [The discussion of whether or not to have a public arena - for concerts and collegiate sporting events is an entirely different discussion.]

Obviously unable to see the contradiction in their own thought, the Journal continues on, "Newer NBA facilities are self-sustaining and can make money even when the teams are not playing." If these are such sure-fire, game-changing, no-brainers, why does the public have to be involved at all? Yet another point where the logic of stadium subsidization falls apart.

They close with, "And so the clock is winding down on the Bucks. It's time for the city and business leaders to pull up and try a game-winning shot." Yes, when the evidence and data contradict your premise, simply use a hackneyed sports cliche to sell that sow's ear as if it were a silk purse.

Weekend Reading

Challenges In Housing & Mortgage Markets
Climate Change Made Sandy Worse. Period.
Downtown's Are Booming
401Ks Creating Generation Of Workers Unable To Retire
Marijuana Helps Prevent Lung Cancer
Menard's Anti-Obama Content
Programs Outside Health Care To Decline As Share Of Economy
Scott Walker Rejects Health Care Reform
10 Things 401K Plans Won't Tell You

Tuesday, November 6, 2012

Walker's Wake Of Destruction

It seems whichever public office Scott Walker worms his way into, he leaves a stench of corruption, an ever-burgeoning suspicion, and a general wake of destruction.

Train-maker Talgo Sues Governor Walker, Wisconsin

From the increased costs and lawsuits from his attempted privatizations, his lying and duplicitous tactics, to the unconstitutionality of his bills, Scott Walker is (and has been) a disaster.

Wack Job

More proof most CEOs are know-nothing, overpaid, blowhards.

Jack Welch doubles down on jobs numbers conspiracy theory.

Saturday, November 3, 2012

Weekend Reading

Bogle On Active Management
Crazy Idea That Government Doesn't Create Jobs 
Fat Cat Comments Or Dodd-Frank
Food Stamps Cause Global Depression
Historical Trends In Income Inequality
The Real Barrier To Tax Reform
Social Security Keeps 21 Million Out Of Poverty
Why Democrats Are Right To Politicize Sandy
World's 200 Richest People

Bradley Center Boosters Keep Pounding That Drum

Sheehy Plans Task Force To Study New Arena

Don Walker begins the article stating, "By mid-2014, the community needs to have a good idea of what role the private and public sectors will play in the construction of a new, multipurpose arena in Milwaukee."

We hear tales about the omnipotent private sector and free market...so efficient, so perfect.

Simultaneously, we're also told how the government is wasteful, full of slackers, and just can't do anything right.

Yet (for some reason) the inefficient, know-nothing government needs to play a major role in the planning and funding of private sector activities.

Enter sport stadiums. These privately controlled initiatives are (supposedly) such game changers, job creators, catalysts, no-brainers. [They're not.] But, again, for some unexplainable reason, the inept public sector needs to invest heavily and absorb most of the risk.

Living wages, universal health care, pensions, unemployment insurance, Medicare, Social Security - that's just a bunch of welfare for moochers. But corporate welfare - such as the public sector picking up most of the tab to build teams new stadiums - is just good policy?

The question should be - why is the public sector involved, at all, in the financing of these private sector playgrounds? If Herb Kohl and the Bucks want a new stadium, go ahead and build one. But the public shouldn't have to shoulder most of the cost.

Where does such a corporate welfare policy end? This misguided corporate welfare is why we now must pay blackmail money to Harley-Davidson and Mercury Marine when they threaten to take jobs away.

If the public is now responsible for the cost of building private businesses, shouldn't the public have a greater say in the operation - the pay scales, the retirement plans, the health care options, the environmental footprint, etc.? If the public sector is a necessary partner in construction, financing, and maintaining the viability of a business, shouldn't they have a representative voice in the organization making sure the public is getting back a fair return on their investment?

For Further Reading:
Basket Case 
Buck The System
Buck You 
Economic Engine Or Albatross?
Is There Anything A Stadium Can't Solve?
Overblown Bradley Center Impacts
Stadium Swindle
Will Herb Kohl Blackmail Milwaukee?

Tax Cuts Do Not Boost The Economy

A recent Congressional Research Service report documented what many already knew: giving tax breaks to the rich helps concentrate wealth at the top, but it does not boost the economy (as reported here).

Taxes & The Economy: An Economic Analysis Of The Top Tax Rates Since 1945.

Thursday, October 18, 2012

Red State Welfare Queens

[source]

From The Department Of I-Told-You-So

Back in February 2011, I warned about the nefarious implications of Scott Walker's plan to turn the public Department of Commerce into the semi-private Wisconsin Economic Development Corporation.

I have been critiquing it ever since. My most recent screed, as of July 2012, Walker's Untraceable Slush Fund, pretty much called it.

As the Journal Sentinel notes, Walker promises dramatic moves to correct loan oversight problems at WEDC.

"The Milwaukee Journal Sentinel reported Wednesday that since its creation in July 2011, the Wisconsin Economic Development Corp. failed to track whether 99 businesses were repaying a total of $8 million in past-due loans - or 16% of the agency's $51 million loan portfolio."

These types of redevelopment initiatives (privatization, tax credits, subsidies, etc.) are actually studied by academics. As cities and states try these different supposed catalysts, social scientists are measuring the results. This is where the "best practices" guides come from. And, where the "things to avoid" recommendations come from. That is, if one is willing to actually read the reports.

Whether public or private investment, certain questions must be addressed and answered with any initiative. Especially when public dollars are at stake, most would ask: What's the return on investment? How many jobs have been created? What's the cost per job created? Were there noticeable income gains in the area due to the initiative? Etc.

Good Jobs First actually published The Risks of Privatizing State Economic Development Agencies in January 2011. But Wisconsin did it nonetheless.

The same was found for film industry tax credits, yet we still do those.

Similarly unimpressive results were discovered for venture capital, nevertheless we are still pursing this mirage.

It's well past time to stop buying this snakeoil.

Update:

Here comes the Journal Sentinel to Scott Walker's rescue; putting the proverbial lipstick on this Walker pig.

WEDC: A good idea, but so far, poorly executed.

This [the WEDC] is another one of these supposed game-changers where the evidence indicates it is not a good idea. But the Journal wants it to be, so it must be. We just need to accept it.

Maybe if the Journal actually did the heavy lifting before getting behind all these harebrained ideas they wouldn't have to spend so much space qualifying, contorting, and making excuses. And, heaven forbid, maybe they'd actually provide some insightful policy analysis, rather than just practicing sycophantic boosterism for Scott Walker.

Biden Fact Checks Ryan

Saturday, October 13, 2012

Specifics? Nope. Republicans Prefer To Lie



Six Studies Falsehood Over Tax Plan
6 Studies Paul Ryan Cited Prove Romney Tax Plan Is Impossible
Romney/Ryan Have Resorted To Lying As A Form Of Debating 

Where's The Penalty For Being Wrong?

Weekend Reading

The Arithmetic Of Unemployment & Labor Force Participation 
Austerity Is Much Worse For The Economy
The Evolution Of Airfares In One Chart
A History Of Movies In Four Parts
Housing Recovery In Perspective
Is BofA's Foreclosure Review Really Independent?
Lavish CEO Pay Doesn't Work As Intended
Private Sector Not GSEs Triggered Crisis
The Problem Of Conservative 'Intellectuals'
Ryan Supported Social Security Privatization
Will Paul Ryan's Past Threaten His Future?

Paul Ryan: No Style, No Substance

I wasn't going to comment on the Biden-Ryan debate, but then I happened across the Milwaukee Journal Sentinel's The VP Debate: On Style, Ryan; On Substance, A Draw. As usual with the Journal Sentinel, WTF?!

We'll start with this myth of style. Paul Ryan is a B-movie actor, a JC Penney catalog model. Most people I've talked to about Mr. Ryan's delivery find it to be completely patronizing - exaggerated facial expressions, predictable intonations, and hammy overacting, in general.

When Romney (even though he lied his ass off) was aggressive with the President, he was declared the winner of the first debate. When Biden aggressively challenged Ryan's lies, he was a meanie. For the Journal, Ryan's stumbling to explain his debunked ideas and/or being completely vague, yet doing so with a smile, makes one a winner in style.

How can it be a draw on substance when the majority of Paul Ryan points were false? When Ryan's responses or statements are peppered with half-truths, outright falsehoods, and complete bullshit, how is that substantive? Even the Journal states, "Biden may have done a bit better in becoming a fact-checker on some of Ryan's statements." An underlying theme behind "substance" is that it not be complete bullshit. If, as even the Journal admits, Biden told more truths, by definition, he won on substance. 

The Journal also pushes the myth that Ryan is a man of ideas. If all the things one suggests are false or mathematically impossible, they're not ideas, they're bullshit. This Journal opinion piece wasn't an unbiased appraisal of the debate, it was merely another opportunity for the Journal to further their right-wing talking-points and to defend another one of Wisconsin's conservative gasbags.

Paul Ryan is as big a phony as we've ever seen on the national political stage. And, as I've said before, the journal in Milwaukee Journal Sentinel is definitely not for journalism.

For Further Reading:
Paul Ryan's 5 Biggest Lies 
Paul Ryan's Mularkey On Full Display
Ryan's Biggest Debate Lie
Ryan Misleads About Social Security
Ryan Told 24 Myths In 40 Minutes
3 Lies From Paul Ryan

Thursday, October 11, 2012

Revisiting The First Debate

Paul Ryan: Liar

Spending, GDP & Other Republican Fairy Tales

Republicans are trying to use fear to convince voters that government spending as a percent of GDP is growing and must be cut. "Spending is out of control! If we don't stop it, we're doomed!"

As the first graph below shows, over the last century, at various points, spending as a percent of GDP was at, near or above it's current level. It was much higher after the Great Depression and during World War II. 

Like then, we were now in the midst of an economic downturn second only to the Great Depression. And, we've been involved in war for the last decade. Overall, an extremely similar situation. 

Spending then was almost twice what it is now. And that spending, after the Great Depression, created the middle class. 

Today, the middle class is shrinking. Plus, we're spending a lot less to rebuild our economy. We should be afraid of austerity, not spending.

[source

It's great to hear all this talk of decreasing federal government spending...but, the fact of the matter is, most government spending is done at the state and local level. At the federal level, money goes to defense, Social Security and Medicare. At the state and local level, spending is on police, education, and libraries, amongst other necessities. Regardless, this spending is done because citizens like these programs and services. If we cut federal spending, that just means states have to pay more - which means, they have to tax more to pay for the services citizens want.

Monday, October 8, 2012

Romney Debates Himself

Remembering The Bush Years (In Charts)

Closing The Book On The Bush Legacy:
  • Consider first the median income. When Bill Clinton left office after 2000, the median income-the income line around which half of households come in above, and half fall below-stood at $52,500 (measured in inflation-adjusted 2008 dollars). When Bush left office after 2008, the median income had fallen to $50,303. That's a decline of 4.2 per cent. That leaves Bush with the dubious distinction of becoming the only president in recent history to preside over an income decline through two presidential terms. "What is phenomenal about the years under Bush is that through the entire business cycle from 2000 through 2007, even before this recession...working families were worse off at the end of the recovery, in the best of times during that period, than they were in 2000 before he took office," says Lawrence Mishel, president Economic Policy Institute.
  • When Clinton left office in 2000, the Census counted almost 31.6 million Americans living in poverty. When Bush left office in 2008, the number of poor Americans had jumped to 39.8 million (the largest number in absolute terms since 1960.) Under Bush, the number of people in poverty increased by over 8.2 million, or 26.1 per cent. Over two-thirds of that increase occurred before the economic collapse of 2008. When Clinton left the number of Americans in poverty stood at 11.3 per cent; when Bush left that had increased to 13.2 per cent. The poverty rate for children jumped from 16.2 per cent when Clinton left office to 19 per cent when Bush stepped down.
  • The story is similar again for access to health care. When Clinton left office, the number of uninsured Americans stood at 38.4 million. By the time Bush left office that number had grown to just over 46.3 million, an increase of nearly 8 million or 20.6 per cent. 

  









Romney's China Rhetoric

Romney's China Bashing Blasted
Romney's China Rhetoric Questioned By Conservatives
Romney's China Stance: Hypocrisy On Steroids
Romney's Hypocrisy On China



Republicans Destroyed Economy

Saturday, October 6, 2012

Romney's 10 Most Baseless Claims

"And these businesses -- many of them have gone out of business. I think about half of them, of the ones have been invested in, they’ve gone out of business." – Mitt Romney, Oct. 3 Presidential Debate

Businesses that got government clean energy loans failed at a rate of about 1.4 percent at the end of 2011, according to The Washington Post.

"My plan is not to put in place any tax cut that will add to the deficit." – Mitt Romney, Oct. 3 Presidential Debate

Romney's tax plan would cost the country $4.8 trillion over the next 10 years, according to Tax Policy Center data, cited by NBC News.

"You never balance the budget by raising taxes." – Mitt Romney, Oct. 3 Presidential Debate

President Bill Clinton managed to balance the budget during his time in office with a tax boost for those in the top 2 percent of earners, according to Duke professor William Chafe.

"The president has a view very similar to the view he had when he ran four years ago, that a bigger government, spending more, taxing more, regulating more -- if you will, trickle-down government would work." – Mitt Romney, Oct. 3 Presidential Debate

President Obama's proposed budget is estimated to cut about $1.1 trillion over the next 10 years and, so far, Obama has signed $2 trilion worth of spending cuts into law, according to Democratic Party Pollster Bernard Whitman.

"Up to 20 million people will lose their insurance as Obamacare goes into effect next year." – Mitt Romney, Oct. 3 Presidential Debate

Some workers may switch from their employer-provided health plans, according to the Congressional Budget Office, but that number is more likely to be closer to between 3 and 5 million per year between 2019 and 2022.

Obamacare "puts in place an unelected board that’s going to tell people, ultimately, what kind of treatments they can have." – Mitt Romney, Oct 3 Presidential Debate

Though Obamacare does create an independent board, the law prohibits the board from making recommendations to "ration health care," or "otherwise restrict benefits or modify eligibility,” according to Bloomberg.

"The idea of cutting $716 billion from Medicare to be able to balance the additional cost of Obamacare is, in my opinion, a mistake." – Mitt Romney, Oct. 3 Presidential Debate

The indirect effects of Obamacare have yet to be determined, since the law has yet to be implemented. But as the law is written now, Obamacare doesn't cut seniors' benefits as part of its plan to curb health care costs, according to USA Today.
Obama's healthcare law would curb benefits to health care providers and insurers, but doesn't directly cut seniors' benefits. Critics allege however, that the cuts in payments would have the unintended consequence of hurting seniors because doctors would stop accepting Medicare patients, according to USA Today.

"It's hurt the housing market because Dodd-Frank didn't anticipate putting in place the kinds of regulations you have to have. It's not that Dodd-Frank always was wrong with too much regulation. Sometimes they didn't come out with a clear regulation." – Mitt Romney, Oct. 3 Presidential Debate

The Dodd-Frank regulations aim to prevent another housing crash like the one that helped to cause the 2008 financial meltdown by banning high-risk lending practices, according to CBS News. In addition, the housing market has been on a slow rebound since Obama took office.
If anything, it may be banks that are holding back the housing recovery. Many are slow to lend because they're concerned Fannie Mae and Freddie Mac will make them take back any bad loans, the Wall Street Journal reports.

"I just don't know how the president could have come into office, facing 23 million people out of work, rising unemployment, an economic crisis at the -- at the kitchen table, and spend his energy and passion for two years fighting for Obamacare instead of fighting for jobs for the American people. It has killed jobs." – Mitt Romney, Oct. 3 Presidential Debate

The Congressional Budget Office estimates that healthcare reform will reduce the health care industry's workforce by only about 0.5 percent, largely because workers will decide to retire early or work fewer hours. And if Romney's Massachusetts health care reform law is any indication, job loss won't be a big problem; employment trends in the state have mirrored national trends since Romneycare took effect.

"The president said he’d cut the deficit in half. Unfortunately, he doubled it.” – Mitt Romney, Oct. 3 Presidential Debate

When Obama took office in 2009, the deficit was projected to be $1.2 trillion during that year, and it ultimately turned out to be $1.4 trillion, according to Congressional Budget Office data cited by The New York Times. The deficit is expected to be $1.1 trillion for fiscal year 2012.

Republicans Angry Economy Improving

As the USA Today reported, regarding Republicans accusations and conspiracies over the latest jobs report:

"Bollocks,"' Wharton School economist Justin Wolfers said. "Once you understand how the numbers are collected and processed, you understand that it's literally impossible to fool with the numbers.''

Manipulating the unemployment rate would require the cooperation of thousands of people -- not to mention violating federal laws.

The unemployment rate is based on a survey of 60,000 households, conducted at the middle of each month because holidays, which can result in short-term hiring or layoffs, are usually at the beginning or end of a month, said Karen Kosanovich, an economist at the U.S. Bureau of Labor Statistics who works on the survey.

About 1,500 Census workers gather the data, and the survey dates back to 1940, Kosanovich said.