Politics from the Palouse to Puget Sound

Saturday, November 20, 2010

Washington Unserious Job Creation

The good news is that Washington experienced a net gain of 5900 jobs in October. The bad news is that more than two thirds of those jobs were in the public sector. Admittedly, my formal training in economics is limited to about 8 units several decades ago, but I’m reasonably confident that a job market that creates two public sector jobs for every private sector job is not sustainable. It is the private sector that creates the wealth that provides sustenance for the public sector, and there is simply no way that a single private sector employee can generate enough wealth to support his own family and two others. The 5900 jobs “created” in October bring the 2010 total in Washington to 6000. That’s all. For the whole year.

October’s private sector job creation included 1500 professional and business services, 800 service jobs in the wholesale trade, 400 service jobs in information, 400 service jobs in the financial services sector and 300 jobs in retail sales. All of these jobs are in the service sector. No one was hiring “activists.”

Meanwhile, the manufacturing sector lost 400 jobs, as did transportation. Another 200 disappeared from the mining and logging industries as did 300 in hospitality and leisure.

So if you’re coming to Washington looking for a job, don’t plan on actually creating or building anything.

Another news story I read this last week noted that the few private sector jobs that our country is creating are mostly in low tax, right-to-work states, which certainly makes sense. Washington’s high tax, union dominated political climate recently drove Boeing to start construction of a new 787 assembly plant in South Carolina.

Even someone with my limited economic training can figure out that this is not going to last. If Washington is ever going to dig itself out of its economic hole, its ruling class will have to look past the interests of its traditional campaign contributors and power brokers and take difficult decisions.

Unfortunately higher education in this state (and in every other state for that matter) is not contributing as much as it could to economic vitality. For all of the hand wringing and political posturing dedicated to the problem of underwater mortgages, mortgages in which the principal balance exceeds the value of the property, higher education is creating a bubble of its own with underwater college degrees.

Universities are pouring out graduates with degrees in subjects that have little or no market value. And to get these worthless degrees the students have accumulated mountains of student loan debt which will weigh heavily on their own futures.

Mortgage lenders have become favorite targets of our ruling class for their supposed “predatory lending practices,” otherwise known as subprime mortgages. Subprime mortgages invited people with poor credit histories and lower incomes to purchase homes that they otherwise could not afford. This practice was forced upon lenders and was once touted by the same ruling class that now condemns it as a means to provide lower income people with an opportunity to accumulate equity. It worked until it collapsed under its own weight.

In its own way, higher education has engaged in its own predatory lending practices by encouraging student to incur heavy debt loads with the promise that a college degree will increase future earning potential sufficiently to make that loan a good investment. Unfortunately, this is not always the case. I recently stopped by a booth at an academic fair to pick up a recruiting brochure that was being handed out to prospective freshmen. It included a fanciful list of careers that this particular academic major supposedly prepared its graduates for. One of those jobs was as that of an “activist.” I don’t know that there are all that many jobs for professional troublemakers but I do know that the few that do exist don’t pay well and certainly do not contribute even one thin dime to wealth creation. It will take some time for an activist to pay off $50,000 or more in student loans. A recent New York Times article told the sad tale of a woman who accumulated $100,000 in student loan debt earning a degree in women's studies and is now discovering that her Bachelor’s degree is worth less than a high school diploma. Some investment.

Colleges and universities are not necessarily trade schools. But we do no one any favors by turning out graduates who won’t even be able to pay off their student loans.

Saturday, November 06, 2010

Only Enduring Principles Will Cement An Enduring Victory

For two years now, Republicans have played the role of the dog that chases cars, in hot pursuit of a goal, but with no clear plan what to do once they attain it. But now they’ve caught it, or more accurately, it was handed to them, and now they have the burden of proving that they are worthy of the responsibility that the voters have assigned them. Up until now, the Republicans have profited primarily from their status as the default alternative to a Democratic Party that has given the voter every reason to turn them out.

And they don’t have a lot of time to present a plan. The landscape is not what it once was. It took 40 years of the Democratic Party’s arrogance and mismanagement to wear out the American people’s goodwill before they were thrown out of power in 1994. Republicans needed only 12 years to alienate America and return control to the Democrats. This time, the Democrats turned the trick in only four years. Clearly, Americans’ patience is not what it used to be.

One reason is that Americans have access to unfiltered information now. If we still lived in a world where Walter Cronkite and the New York Times held monopolistic control over information, there never would have been a Gingrich Revolution.

And this election should tell the Republicans what they need to do. After years of believing media advice that they needed to move toward the Democrats, the electorate demonstrated otherwise by tossing out moderates of both parties. On the day before the election a public opinion poll revealed that Nancy Pelosi’s job approval stood at 8%. Eight times that many disapproved of her work. Moderates rejected the Republicans in 2006 and 2008 because they failed to draw a significant distinction between themselves and the Democrats. Nancy Pelosi highlighted that distinction for them and independent voters rejected the Democrats’ vision.

The large majority of Americans have made it clear that they don’t want moderation. They want decisiveness. If Republicans are capable of learning, they could take lessons from what has worked. New Jersey Governor Chris Christie and Virginia Governor Bob McDonnell both won surprising victories by promising to govern conservatively. Both have grown in popularity by adhering to those promises. This is especially notable in New Jersey as that state is about as hostile to Republicans as any in the union.

If Republicans can demonstrate that they’ve learned their lessons and are willing to make the difficult choices necessary to steer America back on the right track, they are likely to be rewarded in 2012, because it’s unlikely that Democrats will be able to give Americans an affirmative reason to restore them to power.

Pennsylvania Governor Fast Eddie Rendell probably best summarized the fatal flaw in the Democratic Party on election morning as he predicted a better than expected result for the Democrats. He credited Barack Obama with appealing to the Democratic Party base to reinvigorate their enthusiasm.

Rendell identified the “heart and soul” of the Democratic base as “blacks, Latinos, gays and lesbians.”

The problem with having grievance politics as your strength is that even when you manage to win, your mandate is not the nationalization of one sixth of the economy, or an unprecedented intrusion of the federal government into every aspect of private life. You are only charged with retaliating against the dominant culture for the satisfaction of a few small slivers of the population.

Keeping that heart and soul enthusiastic also requires a constant refreshment of the culture of grievance. An outstanding example of just how difficult that cultivation has become can be found in columnist Eugene Robinson’s Election Day column in which he predictably exposed racism in the Republicans’ campaign battle cry: “Take back the government.”

Mr. Robinson inferred from this simple slogan that Republicans meant for white folks to take back the government from a black man. In fact the phrase is a call for a return to self government and away from the paternalistic path to serfdom that Barack Obama and Nancy Pelosi sought to drive us down as though we were cattle.

Mr. Robinson could not possibly have found this slogan offensive if his grievance mentality had not overwhelmed his sense of irony and his long term memory. Barack Obama and Nancy Pelosi used those identical words in 2008.

An appeal to tribal grievance will never be a match for a defense of liberty.

Wednesday, November 03, 2010

Rossi Campaign Cautiously Optimistic As Voter Count Continues

As of 11:57 PM, the Washington Secretary of State was reporting on its website Election Day results showing incumbent Senator Patty Murray leading challenger Dino Rossi by a razor slim margin of only 14,005 votes out of 1,430,787 counted.  At the end of the first day of counting, Murray has a lead of 50.49% to Rossi's 49.51%.  However, Rossi For Senate Campaign Manager Pat Shortridge issued a statement by Email late last night outlining some points that should have the Murray campaign sweating bullets:
  • Historically in Washington, the Republican candidates improve their percentages in each county in votes counted after Election Day, usually improving their margins by 2 to 3 percentage points.
  • King County, which is providing most of Sen. Murray’s margin, accounts for 30.7% of all registered voters in the state. According to County Election reports, King County only has 26.7% of the remaining ballots left to count. The rest of the state, where Rossi has a comfortable lead, will count proportionately more ballots post-Election Day.
  • Spokane County, where Rossi is currently in the lead by more than 50%, still has at least 21.6% of the remaining ballots left to process, with more coming in.
  • Rossi is currently leading in Pierce County by nearly 2,500 votes
  • According to the Secretary of State, there are still over 508,000 estimated ballots left to process statewide.
  • Again, we will know more over the next several days as ballots continue to come in and counties continue to count. We are confident that the margins we are seeing throughout Washington State, combined with the state legislative victories, will put Dino Rossi ahead by an overwhelming margin.
This election is not like previous statewide races that Rossi has run.  It is a midterm, off-Presidential cycle election.  These usually favor Republicans, that traditionally exhibit more faithful voting habits.  In addition, a Republican tidal wave is sweeping the nation, with Republicans gaining a solid majority in the U.S. House of Representatives.  Turnout in more conservative Washington districts is running above normal this year.  This trend is elevating Republican Party hopes, as Washington is poised to send a Republican majority of its Congressional Representatives back to D.C. come January.  Five of Washington's nine Congressional seats appear to be in Republican hands:
  • District 2 John Koster is leading his opponent 50.41% to 49.59%.  This is a Republican "gain".
  • District 3 Jaime Herrara is leading her opponent 52.92% to 47.08%.  This is a Republican "gain".
  • District 4 Doc Hastings is leading his opponent 68.31% to 31.69%.  This is a Republican "hold".
  • District 5 Cathy McMorris Rodgers is leading her opponent 64.51% to 35.49%.  This is a Republican "hold".
  • District 8 Congressman Dave Reichert is leading his opponent 55% to 45%, this is a Republican "hold".
Republican gains in west-side Congressional Districts are exceeding local Party expectations.  In addition, a number of voter initiatives regarding taxes have shown a conservative voting streak.  An initiative for a state income tax has gone down in flames, while another requiring a 2/3 majority of the state legislature to raise taxes appears to be passing.  In addition, a rollback of Democratic Party approved taxes on food and bottled water appeared to be passing as well.
While the race is still too close to call, it looks like we may be calling Dino Rossi our Senator very soon.


Monday, November 01, 2010

Momentum On Dino Rossi's Side

The Democrat-leaning Public Policy Polling gives Dino Rossi a two point lead a day before Judgment Day.
Every time PPP has polled the Washington Senate race this year it's found the race to be within 2 or 3 points and our final poll there is no exception. But there is one twist - for the first time we find Dino Rossi leading Patty Murray, by a 50-48 margin.

Neither candidate has much in the way of support across party lines- Rossi's winning 93% of Republicans and Murray's winning 91% of Democrats. That means
independents, as they are in so many races across the country, are making the difference for the GOP here. Rossi leads Murray with them by a 54-42 margin.

The most worrisome number for Murray within the poll, beyond her small overall
disadvantage, is that among voters who say they've already returned their ballots Rossi's advantage is wider at 52-47. Murray's ability to keep the race close is predicated on the 24% of respondents who have not yet done so returning their ballots. That group supports her by a 51-45 margin.