The Bureau of Economic Analysis reported today that personal income growth in the State of Idaho was among the highest in the nation, as indicated by the above map. Before we get to giddy and declare that perhaps our policy makers have done something to spur this, it’s helpful to drill down into the tables a little bit to see that Idaho also in the first quarter of 2010 received its largest annual rate of ARRA (federal bailout) money. In some states, such as Mississippi, transfer payments from the Feds represented half the state’s personal income growth. This begs the rhetorical question then, what happens when those funds are cut off? Anyway, thanks Uncle for all your help floating the economy here!
I know you all watched the primary election coverage on FOX 12, but after I got done telling you everything you needed to know about the election, you had to flip over to KTVB to watch the rest of the results. And if you did, you saw Governor Otter give a very strange speech.
In rallying the party faithful, Otter proclaimed “when we come out of this recession, Idaho is going to lead us” and “We’re gonna show the nation in the next four years how it’s done.” As a former political consultant I can only surmise that his communications staff did not tell him to say such things. Here’s why.
First of all, according to the Bureau of Economic Analysis, that is, the agency that keeps official tabs on the economy, the U.S. came out of the recession as early as July 2009. In fact, we have now had three consecutive quarters of positive GDP growth.
Secondly, Idaho did not lead the U.S. out of the recession. Fact is, Most of Idaho is still in a recession and the economic driver of the Idaho economy, the Boise-Nampa MSA which generates 50% of the state’s GDP is one of the worst performing metro areas in the country. This chart from Brookings Mountain West’s Mountain Monitor tells the story:
As you can almost clearly see, of the largest 100 metros in the U.S., Boise is 95th in the country in employment losing 10.7% of the job base since the peak of employment. Boise’s housing market is also nearly the worst in the country among the large metros - ranked 96th - among the 100 largest cities. Brookings has the whole report posted at their website.
The one thing that we know for sure is that bravado is not going to do a darn thing to help us get out of this funk, neither is ignoring it, or pretending it isn’t there. The fact is, the U.S. is out of the recession, and Idaho aint, and someone’s got to do something about it eventually.
We’ve all heard the common quip that “government ought to run like a business.” You’d think that if that was going to happen anywhere, it would be Idaho where the Governor and much of his cabinet (like Mike Gwartney and Richard Armstrong) are former business executives. But I’ve noticed in recent weeks that government policy and private sector behavior in Idaho are taking wildly different paths. Consider:
Meanwhile, here’s what is happening in Idaho’s private sector related to health care:
I’m not here to advocate for policy one way or another. I just want to point out that just maybe Idaho’s leaders - ostensibly concerned with economic development and economic recovery - might want to take a look at where the private sector is investing. In Idaho, that’s in health care.
If you watched Fox 12 News at Nine like you should be, you saw me pooh-pooh the Otter/Wasden/12 other states lawsuit against the federal government.
The lawsuit asserts that Congress has no authority under the U.S. Constitution, to compel individual citizens to participate in the economy, e.g., by forcing them to buy health insurance. Regardless of your point of view on how the courts have interpreted the Commerce Clause over the years, I felt safe in saying that the lawsuit probably won’t get anywhere.
What we have here is a two part strategy on the part of the Republican Party to scuttle this health care bill. The first part of this attack is legal - the lawsuit filed by 13 Republican Attorneys General. The second part is political. Some members of Congress are vowing to repeal this measure. That is not at all likely. If the U.S. Senate could not bottle this thing up in procedure, the members who oppose this measure certainly have no chance to repeal it outright. There is also the “reconciliation” process the bill must go through; the final form of this bill is still unknown. Congress will hash this out under a detailed set of rules over the next few weeks. I also think that it is unlikely that the bill will change significantly in this process.
Were I still in the political consulting business, I’d tell the GOP to give it up. They lost this fight and they never even put forth a compelling alternative vision. John Boehner should be replaced. Though he has Don Draper looks, he is no Newt Gingrich when it comes to vision, strategy, and tactics - and a heavy dose of vision is what the GOP needs right now.
So while Governor Otter’s concerns are real - how indeed will Idaho afford this - this lawsuit and the reconciliation process are not going to deliver the results he hopes for. What our leaders need to do now is add this issue to the other huge financial and economic challenges facing Idaho. The Boise-Nampa metro region is one of the nation’s worst performing metros - and no one in our state has announced a way forward. So after all the shiny objects - lawsuits, political posturing etc. - go away, we’re still left with that little gem of a fact.
For additional reading:
Brian Murphy over at the Statesman did a nice job covering this story this morning. If you are into reading the legal analysis, the Volokh Conspiracy has several articles by law professors talking about this in detail.
Any day now my good friend Dave Frazier will be going ballistic over on the Guardian Blog about HOUSE JOINT RESOLUTION 5, which passed the House 57-12-1, and the Senate 34-1. This resolution which will go to a vote of the people this fall would amend Idaho’s Constitution so that Airports can issue bonds without having to get a vote of the people. This is an idea whose time has come as evidenced by the vote. Good on you Senator Stegner for finally designating some authority to jurisdictions other than the state. With luck, this is the start of a new trend.
But there are those who still don’t see the need to devolve power to local governments and other jursdictions. Idaho’s cities and counties (and airports and public hospitals, etc.) have less authority than do the cities and counties in any state west of the Mississippi (see: D, Krane, Rigos N, and Hill M. Home Rule in America : A Fifty-State Handbook. CQ Press, 2000.). Of the 12 Representatives that voted against this measure, half are from urban areas, the other half rural. Thus, the urban rural divide is still in full effect.
I think it is somewhat amazing that anyone from an urban district would vote against this, thus some of these legislators’ votes deserve special attention. Clifford Bayer (R), Boise casts a vote that puzzles me. His district is part of the economic engine of the Valley. The Boise-Nampa MSA is responsible for 50% of state’s GDP. Voting to hamper the airport is no help to this economy or the citizens in his district.
Representative Hartgen (R), Twin Falls is the other mystery here. His vote is interesting first because his own district struggles with urban problems such as providing public transit - so he should be well aware of the need to start devolving authority to the governmental units that can actually solve his people’s problems. Secondly he is a professional economic development consultant. Voting against the public’s ability to provide infrastructure isn’t in any of the textbooks I had on economic development.
Several of the delegation from the CDA area voted against this measure as well, showing that they too do not yet grasp that their region is an urbanized area and also very much needs to have some flexibility to solve regional issues such as the traffic between CDA and Spokane, and also the border crossing to the north. No longer are CDA and Hayden sleepy little mountain towns on the way to nowhere.
Full details on the bill are available over at the Statesman.
There’s been a lot of hullabaloo surrounding Hawks stadium recently, mostly coming from Meridian. I have to hand it to Mayor DeWeerd and the Meridian Development Corporation: they have a vision, and a mission and they are going after it.
This morning the Boise Hawks unveiled a survey that showed a vast majority (75%+) of the 300 people surveyed, favored construction of a new multi-purpose sports facility somewhere in the Valley. It turns out that a plurality of people also identified MERIDIAN as the favored location for a new sports facility. I am guessing that this will have a few people at the City of Boise upset.
In January 2007, a design charrette for the 30th District Master Plan in Boise, revealed that the 200 people in attendance hoped that a new Hawks stadium would be built in downtown Boise. The photo below appears on page 185 of the 30th Street Master Plan, available on the City’s website.
Hawks Stadium envisioned as part of the 30th Street Neighborhood
So what say you, City of Boise officials? Are you working up a deal to make the stadium a centerpiece of a new 30th Street Neighborhood? The implementation plan for 30th Street says that within 1-3 years Boise City and CCDC will:
Identify where land assembly, land acquisition and/or development partnerships would help implement the development concept for each subdistrict. Initiate conversations with property owners to determine their level of interest in selling property, land assembly and/or development.
Where are we on this project? Granted the plan only went forward in June 2009, but with Meridian breathing down your necks, it might be time to kick this project into high gear - unless you really like the sound of “MERIDIAN HAWKS.”
Tags: 30th Street, Baseball, Boise, Hawks, Meridian
Development, Economic Development, Economy, Fun, Government, Infrastructure | admin March 10, 2010 | 
Comments (1)
This week the news broke that Mayor Phil Bandy of Eagle was resigning, apparently tired of “personal attacks” levied against him for his taking another job (though his Mayor duties are a full time position), and constant battling with City Councilman Al Shoushtarian. The Statesman has the full scoop.
The question in my mind, though, isn’t “who should be the next Mayor of Eagle” but should Eagle even continue existence as a city. Here’s the facts:
- It can’t afford its city hall space
- It has laid off 40% of its employees
- It has reduced its budget by a third
- City hall is closed on Friday’s because it cannot afford to stay open
- The City is borrowing money to stay afloat
This sounds like a city that needs to unincorporate, and get taken over by Meridian.
I say the same thing about Garden City. Ada Sheriff Gary Raney has said that he can provide law enforcement services to the municipality for less than what the Garden City police force currently costs. If I recall correctly too, GC has had problems in the past with making its contributions to Valley Regional Transit. The GC folks haven’t been able to get anything done with the fairgrounds either (though I am not sure there is any local government ready to tackle that problem).
So - Ada County has at least two cities on life support, and regional growth issues coming at us from all sides. That certainly isn’t aided by weak, fractured governments. These cities need to get it together, or give their marbles to someone else.
Economic developers and especially politicians love big signature economic development projects because they provide readily recognizable symbols of their supposed effectiveness. But sometimes those projects go awry. Like Olympic Village in Vancouver. Vancouver lost it’s AAA credit rating when it had to bail out the failed hedge fund that financed the Olympic Village project. Word to local governments everywhere . . .
Saw a story last week that said Portland just passed a $613 plan to improve bike infrastructure over the next 20 years. I know it’s apples and oranges, but $60 million for a streetcar downtown seems like a bargain by comparison. Full story in the Portland Business Journal.
In my new favorite blog from Stanford Economist John B. Taylor we get a great dose of reality about the value of ideas. In a great blog post responding to the charge that Chicago School economists wrecked the economy, Professor Taylor shows graphically how that charge simply cannot be true. The graph below shows the number of University of Chicago, Harvard, and MIT economists on the President’s Council of Economic Advisers:
The only question I had after viewing the graph was, “well, yeah, but what about other policy makers?” He answers that too:
The data are robust when you look beyond the CEA to other top posts normally held by PhD economists. All assistant secretaries of Treasury for Economic Policy appointed during the Bush 43 and Obama Administrations had PhDs from Harvard. During the same period, all chief economists appointed to the IMF had PhDs from MIT, and, except for Don Kohn, who was promoted from within and Susan Bies who was appointed as a banker, all PhD economists appointed to the Federal Reserve Board were from Cambridge MA.
So the crash? Blame it on Harvard.
Veritas.
