The 39,000 Jobs Hoax

By Keith R. Schmitz

The Walker administration and the six Republican state senators involved in this week’s recall election are throwing out the claim that the changes they have brought to state government have led to the creation of 39,000 new jobs. The media is allowing them to make that brag as well.

The six GOP targets have to sell this idea. Their jobs are on the line and if there is a metric people are looking at for all politicians right now, it is job creation. During last week’s debate in Menomonee Falls hardly ten minutes went by without Alberta Darling bringing up these job numbers and how wonderful their programs are.

For this discussion, let’s not talk about the quality of these jobs. After all, Walker chased away what would have been 5,000 good paying jobs with a future connected with extending the high-speed rail line before he even took office.

The question here is how can Walker, Darling, et al tell you that they helped create these jobs, when the realities of business tell you otherwise.

He Swears the Jobs are His

So we are to believe that the moment Scott Walker raised his right hand to take the oath of office for Governor, those jobs started popping up like mushrooms?

Usually businesses look for new hires when they have something for them to do. It would be mind stretching to think that just because someone is a fanatical Walker supporter that they would be bringing people on just because Scottie is at the helm. Not these hardnosed captains of industry.

For existing businesses, new faces generally start appearing only after a business sees a rise in revenue thanks to customers walking through the door or the sales force putting orders on the books. The evaluation process often takes months for a number of reasons and even then it’s not like people just start popping up, because recruitment takes some time.

Sure there can be new businesses opening their doors but even the planning for those is months in the works.

Origin of the Jobs?

The point is that the Walker/Darling/GOP assertion of creating 39,000 new jobs since January is ludicrous, given the way business works. It is also ludicrous because an administration has to do something to earn the credit for job creation.

A couple of times during the debates, Darling mentioned that 85% of Wisconsin business leaders said that Wisconsin is heading in the right direction. Make that 85% of the membership of WMC, a wholly owned subsidiary of the Republican Party.

Now if anyone would be hiring because of giddiness over having Walker in office, it would be them. It would be interesting to find out how many of these companies have brought on new employees since they are among the state’s very largest companies, though we would never know when they actually started to think about adding these jobs.

Where Credit Is Due

The GOP crowd may not like to see this, but just about all these jobs probably began their gestation period back during the Doyle administration, with a big help from the Obama stimulus. There are in fact several companies here in Milwaukee that were able to launch new ventures thanks to stimulus funds, ventures that included high paying jobs.

Again, raising your right hand doesn’t count. In reality there was nothing Walker and the GOP did until he signed the budget back in late June. So even then, the clock didn’t start ticking until ink hits paper, so we are still many months out before we know if the plan works.

In between was the signing of the so-called budget repair bill, not a big booster to business. In fact it could be argued the other way. State employees make up 18% of the state work force, and with this large of population saying good bye to a large part of their salary; a number of stores, restaurants and other businesses will see a significant drop off in sales, especially in cities that have large concentrations of public employees such as university towns and places the have correctional facilities.

Let’s get back to the timeline. Walker signs the budget in late June, and any job creation they could take credit for would be legitimately in Fall.

May Not Be a Merry Christmas

But even with the holidays coming, the job picture may not be so rosy. In fact there are reports that this year parents have not let loose with back to school spending.

By then the recalls will be history, but we have some big events to look forward, mostly the prospect of a Walker recall, and his buddies in Congress have not been too helpful.

With the new Congress sworn in, there was as some pundits put it, “a lack of interest for more stimulus.” For many like our US Senator Ron Johnson who proclaimed that “the stimulus didn’t create a single job”, the country is finding out what the real impact of the stimulus is by its very absence. Johnson and his cohort ripped the tubes out of the patient just as the economy was recovering.

Most recently there is the horrible debt ceiling agreement. The right wing loves to assert that government jobs are not real jobs. The problem is that these people are being paid real money, which flows into the real economy and cut off that flow, the economy suffers. Many economists are predicting the loss of hundreds of thousands of jobs once the debt ceiling agreement kicks into action.

Many of these economists are saying that extreme cutting is the last thing this economy needs. And we will soon find out if they are right. That may be by the end of the year, and that’s not good news for Walker.

There is speculation about when the long anticipated recall of Walker kicks into gear, ranging from around the end of 2011 to the 2012 general election. Either way, if the double dip recession hits, probably nothing Walker has done will avert it. Worse, Walker’s budget shredded the social safety net in Wisconsin, amplifying the misery – and heightening the anger against him.

If things play out, it will be Walker who will be joining the ranks of the unemployed, needing to get his first real job since college.

This is of course known in the trade as poetic justice, except we will be the ones paying the price.

Chart of the Day, How's That Stimulus Working? Edition

by folkbum



via Ezra.

Another Duffy moneybomb question

by folkbum

So far, I haven't heard an answer as to whether or not Sean Duffy (who's trying to eke some milage out of the falsehood that the economic stimulus package passed a year ago by Congress is a failure) thinks Wisconsin Republican Rep. Paul Ryan, and the countless other Republicans taking credit for stimulus funds, is being dishonest.

The next question Duffy should have to answer is whether the good folks of Ashland County, his home turf and where he currently District Attorneys from, should give back the $13,939,620 in stimulus funds so far distributed there. Ashland, in fact, has raked in more per capita than the state or national average when it comes to stimulus (in large part because of distributuons to tribal authorities, granted), so I'd say his constituents are currently getting a good deal out of the package.

Ask Sean Duffy if Northland College should take back the more than a quarter of a million dollars' worth of students loans it has given out under the stimulus, to keep students in college who might have had to drop out due to the poor economy.

Ask Sean Duffy if the recipients of well over a million dollars' worth of guaranteed home loans should move back into their cars.

Ask Sean Duffy if Historic Red Bridge over Armstrong creek, a century old and a tourist attraction, should be allowed to fall further into disrepair.

Ask Sean Duffy if the Mathy Construction Company there in Ashland should return its $3 million and lay off the workers called in for the highway projects they're doing.

If Duffy is going to make this an issue, then he needs to answer these questions.

Propoganda

By Keith R. Schmitz

More commie lies...

Many forecasters say stimulus spending is adding two to three percentage points to economic growth in the second and third quarters, when measured at an annual rate. The impact in the second quarter, calculated by analyzing how the extra funds flowing into the economy boost consumption, investment and spending, helped slow the rate of decline and will lay the groundwork for positive growth in the third quarter -- something that seemed almost implausible just a few months ago. Some economists say the 1% contraction in the second quarter would have been far worse, possibly as much as 3.2%, if not for the stimulus.

From The Wall Street Journal.

Right wing gentlemen, start your sputtering.

Sure this may fall back, or it could give rise to more of the stimulus we should have used in the first place.

But for the Grace of God

By Keith R. Schmitz

I am getting tired of reading the smug, callous and yes, brutish accusations against those who have found themselves in a fix -- often a terrible fix -- during this housing crisis. You know. Calling those left with the short end of the stick losers, lazy and worse.

You don't have to go far to find stories about people who are at the risk of losing their house because the loss of a job, a gash in their pay, a major medical hit, death of a spouse or other economic calamity. I'll start you off with this article from Time.

This is not only ignorant, but in some cases whistling past the graveyard.

Wonder why Obama is so popular? A vast majority of people have jobs, but realize that it could be yanked out from under them in a flash.

The cold icy fingers of the bad economy are finding their way into every neighborhood, even the gated ones.

For those sitting on the side lines patting themselves on the back about their wonderful initiative and their self-assurance that they are better than these people; be grateful the government, your government, is on the job trying to solve this mess that your beloved former president left you.

Or else you too could become a statistic.

Shovel Ready Nonsense -- State of the County

By Keith R. Schmitz

Many others have feasted on pieces on this turkey known as Scott Walker's state of the county speech, due in part because all you need to know about this candidate for governor is right here.

Essentially, while others a pursuing nuclear physics in terms of economic, the County Executive is practicing alchemy. The mantra of tax cuts proves the observation that when you are a hammer the world looks like nails.

Here we have as a major emphasis of the speech his fantasy plan for a sales tax holiday. Yet he brags about the bond rating for the county versus that of the state.

So how can he propose lopping off a major source of revenue, with no suggestion of where the money is going to come from to make up the gap? Certainly the proposal from some that the state pass combined reporting for corporations as an offset will not be in Walker's quiver.

Also disturbing is asking county workers to bear the burden of "streamlining" government through job cuts and "reforms" in collective bargaining. With consumer spending making up 70% of our economy it is hard to see how emulating the private sector's means of first resort will help improve this economy.

Usually in deep recessions such as this one you see governments being a means of putting people back to work. I know Walker wants to substitute county workers with private sector employees, but these positions will no doubt be underpaid with few or no benefits.

We did tax cuts for the past 30 years and they have flunked the audition. Stagnant middle class growth, America falling behind in health and education in a highly competitive world, crumbling infrastructure; all have been a result of "starving the beast." We have instead starved the best.

If this stimulus is done right, emphasizing "done right," we stand the chance of not only turning this economy around but also shrinking the deficit through a growing economy. But not doing a stimulus, which features government investment in our economy, ensures we can expect to head towards a depression.

Business Looking for the Defibrillators

Keith R. Schmitz

There is an automatic assumption on the part of some that business people walk in lockstep with the Republican party.

That notion of course has always been wrong, and lately more wrong. The US Chamber of Commerce is pressing for passage of the Senate version of the stimulus package. The reliably right wing National Federation of Independent Business is saying that the current version of the bill is not enough.

Guess there are no free market capitalists in economic foxholes.

Below is a copy of a letter (with some edits to keep the writer anonymous) from a friend a mine in which he emphatically pushes Senator Kohl to support the stimulus. My friend makes a lot of sense and with the vote in the Senate pending, lays out real business world reason why we need this plan to pass.

I am a small Wisconsin business owner. I am writing specifically to comment and note my support for President Obama’s stimulus plan.

Because of the current economic conditions and the slowdown my company has experienced, I’ve had to trim my work force in one plant from (12) employees to (6)—letting my Production Manager, a Draftsman, our Secretary and (3) shop employees go. In Wisconsin, I’ve had to eliminate (6) jobs on the manufacturing floor and fire my second Mechanical Engineer.

While times are very tough, I’m encouraged that we have as many projects quoted and pending as we do. We’ll continue to do what’s necessary to persevere and weather this storm.

But I’ve written about the stimulus package. The suggestion by Republicans that it’s more of the “tax and spend” ways of the Democrats is ludicrous. In these difficult economic times, this is exactly what the country needs—programs that will put people back to work, while working toward long term goals such as alternative energy. As well, the package will help those currently out of work by extending unemployment benefits and healthcare.

The Republicans do NOT speak for this business owner. The suggestion that the stimulus package needs more tax cuts is preposterous. First statistics show that providing tax cuts to businesses will not increase employment rolls. As a business owner, I can attest to this. I will not employ anyone else because of a tax break I might get. Why? Because we DON’T HAVE WORK! If our business is down, I cannot afford to hire anyone whether I get a tax break or not. We’re talking survival and cash flow.

As for individual tax breaks, how is a tax break beneficial for someone who is out a job?

Let’s put people back to work and get this country back on track. Please encourage our Democratic Senators to be more vocal in their support. I just read an article on Yahoo that suggested President Obama is “losing message war on stimulus plan”.

If I can help in any way, please let me know. I am very interested and energized as a result of President Obama’s election.

They Don't Want to Be Stimulated

By Keith R. Schmitz

For some reason I get emails from the hilariously named American for Prosperity. Or is it Americans for the Prosperity of a Really Tiny Minority?

Maybe because I'm in business and they automatically think that if you are in business, you might be a Republican (with apologies to Jeff Foxworthy).

Any way, it is a great way to keep an eye on them, but on the other hand I just might learn something.

Just got their latest communication titled "no stimulus."

Really? Are they that dead?

In the Ideological Bubble

By Keith R. Schmitz

We have our once renowned parks system, transit system, mental health system and county courthouse crumbling and our county Executive Herbert Hoover Walker is telling the Obama administration thanks no thanks to the possible federal stimulus money.

The only federal economic stimuli Walker endorses are tax cuts, and he credited President-elect Barack Obama for recommending $300 billion in such cuts as part of a much larger stimulus plan.

"The last thing you want to do is put money in hands of government," if the goal is to pull the economy from recession, Walker said. This is intractability we can believe in.

The upside is that kids will get a history lesson about what burrowed us deeper into the Great Depression, which was the calcified notion that cutting taxes and a balanced budget would grow the economy. It's just that many of us don't want to experience it first hand.

It has been fashionable for conservatives to claim that FDR's policies prolonged the Depression. David Sirota in a recent column deftly shoots down that notion.

Apparently Walker thinks he is going to make it to Maple Bluff by appealing to that small -- but moneyed -- minority that still believes that doing nothing to stop the avalanche of the bad economy is the best policy. Just leave my income alone.

It will be interesting if the county board can do an end-around and does land a piece of the stimulus pie. If it doesn't, Milwaukee will sink further behind other big cities.

One reason why Milwaukee county and other local governments are on their knees is because state aid has been cut off thanks to the economy and the other worldly Grover Norquist philosophy of starve the beast, implimented by glossy eyed minions. In a democracy we are the government, so we must be the beast and we are being starved.

At first FDR bought into balancing budgets and cutting taxes to stimulate the economy. But in The Defining Moment, Jonathan Alter's book on FDR's first 100 days, the author points out that what benefited Franklin Roosevelt and the country was he had a flexibility of mind and was not tied to ideology, therefore he was open to a number of options. Scott Walker is not so encumbered.

If Walker wants to make history the first bit of wisdom is avoid repeating it.