# Economy



Tramontina resigns over problems with film tax credits

Talk about a bolt from the blue:

A memo from auditors investigating irregularities in a state tax-credit program for filmmaking paint a picture of movie producers and film executives taking personal advantage of the program and state administrators paying little attention.

The director of the Iowa Department of Economic Development, Mike Tramontina, abruptly resigned Friday after allegations of mismanagement of the program surfaced. The department oversees the Iowa Film Office. The manager of that office, Tom Wheeler, was placed on paid administrative leave.

The departure of Tramontina, who was appointed to the post by Gov. Chet Culver in 2007, came after preliminary findings from auditors looking into allegations that filmmakers had purchased luxury vehicles for themselves.

According to the memo obtained by The Des Moines Register, auditors found a long list of bookkeeping lapses and poor oversight in the program, which has spent $32 million on tax credits for 20 film projects since its inception in 2007. The program was aimed at promoting filmmaking in Iowa as a way to contribute to the local and state economy.

The governor’s office announced Tramontina’s resignation at 4:56 pm on Friday. Culver also suspended the tax credit program until auditors complete a review of it.

State Senator Tom Courtney, a Democrat from Burlington, told the Des Moines Register “he talked to state officials about problems with the movie tax credits about a month ago, when labor officials complained that few Iowans were getting hired to work on the movies.” Courtney raised those concerns again in a meeting with the Iowa Economic Development Board the day before Tramontina resigned:

“I’m hearing nothing but complaints that workers are being brought in from other states” during film productions in Iowa, Courtney said. “I don’t imagine we have a lot of Clint Eastwoods running around, but with a little training, we could be doing many of those jobs.”

Michael Tramontina, the state’s economic development leader, said he couldn’t put a number on how many jobs are created, since many are temporary – from contractors used to build sets to caterers and “extra” actors.

“Anecdotally from the film industry, it ranges from 20 to 60 percent Iowans” employed on films produced in Iowa, Tramontina said. […]

Tramontina said the agency is working to develop “employment thresholds” for a film, but hitting a number is complicated.

Employment requirements should depend on the kind of film being made – whether it’s a feature film being made over three to six months or a TV series that might run for years. […]

Courtney said lawmakers might need to address closing what he called “an open door” in film tax credits if Tramontina’s agency is unable to do it. He said most Iowa economic development incentives carry job-creation requirements. “Iowa has a bright future in the film industry, but we have to help the people who live here.”

While Republicans harp on the need to cut spending further, it’s equally important to subject every tax credit to scrutiny. The Iowa Policy Project has found that expenditures on tax credits for business have “skyrocketed” in recent years, far outstripping the rate of increase in spending from Iowa’s general fund. These tax credits should be on the table as legislators look for ways to balance the budget.

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Strong Energy Efficiency Policies Would Save Iowa Families $282 per Year, Create 6,200 Jobs

(I would also like to see energy efficiency programs target low-income households, which spend a higher proportion of their income on utility bills. - promoted by desmoinesdem)

For Immediate Release: September 10, 2009

Contact: Eric Nost, Environment Iowa, 515-243-5835, enost@environmentiowa.org

New Report: Strong Energy Efficiency Policies in Energy/Climate Legislation Would Save Iowa Families $282 per Year, Create 6,200 Jobs

Des Moines, IA – A new national report finds that Iowa households would save an average of $282 per year and 6,200 sustainable jobs would be created in the state over the next ten years if Congress acts now to include strong energy efficiency improvements in energy and climate legislation. The report, entitled Energy Efficiency in the American Clean Energy Security Act of 2009: Impacts of Current Provisions and Opportunities to Enhance the Legislation, was released by Environment Iowa and the American Council for an Energy-Efficient Economy. The efficiency provisions would prevent 5 million metric tons of global warming emissions from being released here in 2020 alone, the equivalent of taking over 900,000 cars off the road for a year. (The report is publicly available at http://www.environmentiowa.org)

(continues after the jump) 

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Labor Day links and events coming up this week

Hope you’ve been enjoying the perfect Iowa weather during this holiday weekend. The U.S. Department of Labor and Blog for Iowa provide background on the history of Labor Day.

Organized labor doesn’t have a lot to celebrate right now, with more job losses in the manufacturing sector and unemployment rising across the country (though Iowa’s unemployment rate is significantly lower than the national average). The Iowa Policy Project finds that “the state of working Iowa” is not good. As in the previous recession, we are losing jobs with good benefits as wages stagnate for the people who still have jobs. We now rank 32nd in terms of median wages, and lower incomes mean less money for consumers to spend at other businesses. Click here for the full report, which also explains that “policy makers could do more to make work pay for low- and moderate-income working families and to insist upon job-quality requirements in economic development strategies.”  

Iowa hasn’t adopted most of organized labor’s key legislative priorities in recent years, in part because of the “six-pack” of Iowa House Democrats that blocked those bills. On the plus side, Curt Hanson’s victory in the House district 90 special election means we haven’t lost any ground on this front. We only need to persuade one or two “six-pack members” (or defeat them in Democratic primaries) to find the 51st vote for “prevailing wage,” for instance.

I haven’t heard much lately about Senator Tom Harkin’s efforts to find a compromise on the Employee Free Choice Act. Getting 60 votes in the Senate for anything meaningful is likely to be quite difficult. The Service Employees International Union has some news related to the EFCA here.

Two years ago I attended the Solidarity Fest Labor Day celebration in Des Moines, featuring John Edwards and Hillary Clinton. The same event, sponsored by the South Central Iowa Federation of Labor, AFL-CIO, takes place today in the 4-H building at the State Fairgrounds from noon to 2 pm. Later today, the Friends of Iowa Midwives are having a family-friendly potluck picnic at Raccoon River park in West Des Moines (4 to 8 pm, suggested donation $5).

After the jump I’ve posted details for lots of other events coming up this week.

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Iowa turning stimulus road funds around quickly

The U.S. House Transportation and Infrastructure Committee has been keeping track of how states are spending the stimulus funds allocated for roads. On September 2 the committee released a report ranking the states according to how much of the American Recovery and Reinvestment Act funding for highways and bridges had been put to work as of July 31. This pdf file contains the state rankings.

Iowa ranked second overall, having put 75 percent of its stimulus road funds to work by the end of July. Join me after the jump for more details from the report and analysis.  

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Cash for Clunkers ends, cash for appliances coming soon

The $3 billion “Cash for Clunkers” program officially ends today, having helped generate at least 625,000 new car sales. Representative Bruce Braley, a key advocate of the program, is holding an event this morning in Bettendorf with John McEleney, Chairman of the National Automobile Dealers Association, and Gary Thomas, President of the Iowa Automobile Dealers Association.

Meanwhile, Energy Secretary Steven Chu has announced that $300 million in stimulus money will go toward cash incentives for consumers to buy energy-efficient home appliances:

Beginning late this fall, the program authorizes rebates of $50 to $200 for purchases of high-efficiency household appliances. The money is part of the broader economic stimulus bill passed earlier this year. Program details will vary by state, and the Energy Dept. has set a deadline of Oct. 15 for states to file formal applications. The Energy Dept. expects the bulk of the $300 million to be awarded by the end of November. (Unlike the clunkers auto program, consumers won’t have to trade in their old appliances.)

“These rebates will help families make the transition to more efficient appliances, making purchases that will directly stimulate the economy,” Energy Secretary Steven Chu said in a statement announcing the plan. Only appliances covered by the Energy Star seal will qualify. In 2008, about 55% of newly produced major household appliances met those standards, which are set by the Energy Dept. and Environmental Protection Agency.

Replacing old appliances can significantly reduce a household’s energy use and utility bills, so this seems like a good use of stimulus money. However, some analysts are skeptical that the new program will be as successful as “Cash for Clunkers”:

“The cash-for-clunkers (program) had a discernible value proposition for the consumer, because he knows how much his (clunker) is worth,” says [Sam] Darkatsh, the Raymond James analyst. “With appliances, there is no trade-in. You can walk into Home Depot and get a great deal on a home appliance any time you want one. Why would it drum up sales now?” Laura Champine, an analyst with Cowen & Co., agrees. “I’m not sure if it will be as powerful as cash for clunkers because there is something compelling about that $4,500 discount,” she says. “Also, a new car is more fun than a new dishwasher. So I’m not sure if it will be as much of a driver, but any driver is welcome right now.”

Share any relevant thoughts in this thread.

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Links on making ends meet in the 2010 budget

With the economic recession continuing to drag down tax revenues, the 2010 budget that the Iowa Legislature approved in April is likely to require significant adjustments.

In June the Legislative Council agreed to cut more than 10 percent from the Legislature’s budget in 2010. The cost-saving measures “include a pay freeze for all legislative employees, reducing travel budgets, and cutting back next year’s legislative session by 10 days.”

A State Government Reorganization Commission will look for other ways to cut spending next year. It will be interesting to compare that commission’s proposals with the kind of cuts Iowa Republicans have been advocating. During the last legislative session, Republicans called for $300 million in spending cuts, but I have been unable to find a link to a document with details about that proposal. (Note: I’ll have more to say in a future post about the state budget reforms Iowa Republicans proposed yesterday.)

After the jump I’ve posted some links and analysis related to the budget constraints facing Iowa and just about every other state right now.

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Nice work if you can get it

Have you gotten four raises in the past six years? Jefferson County supervisor Stephen Burgmeier has, I learned after writing about the Republican’s first television ad for the September 1 special election in Iowa House district 90. Burgmeier is highlighting alleged overspending by Democrats, but if he’s so stingy with the people’s money, why did he keep voting to raise his own pay?

The “check the facts” page on Democratic candidate Curt Hanson’s website contains other useful information too. In addition to raising his own pay repeatedly, Burgmeier voted five times to raise taxes on Jefferson County residents. Did Iowans for Tax Relief know about this record when the group took responsibility for running Burgmeier’s campaign?

The Iowa Democratic Party is running this ad backing Hanson:

Share any relevant thoughts about phony Republican posturing in this thread. You can sign up here to volunteer for the Hanson campaign.

Republican ad for special election targets Culver, borrowing

UPDATE: Curt Hanson has already posted a rapid response at his campaign website.

Two and a half weeks before the September 1 special election in Iowa House district 90, Republican Stephen Burgmeier’s campaign launched its first television commercial:

The producers fit quite a few misleading statements into one 30-second ad. The visual suggests Iowa has taken on “a billion dollar debt,” and the voice-over emphasizes the word “billion,” even though the I-JOBS infrastructure bonding initiative was for $830 million.

The commercial accuses “Governor Culver and his allies” of borrowing “almost a BILLION dollars to pay their bills.” However, the I-JOBS program was created to fund infrastructure projects and has nothing to do with meeting state government’s ongoing spending obligations. (Click here for a breakdown of how the money will be spent.)

During this recession, several other states have been forced to borrow money to pay their bills, but Iowa is borrowing for capital investments. Credit analysts and national institutional investors understand the difference, even if Iowa Republicans don’t. That’s why “investor enthusiasm and high market demand” drove down the interest rate on the I-JOBS bonds.

Next, Burgmeier’s ad shows a man saying, “That’s money taxpayers are on the hook for,” implying that taxes will go up to repay the debt. In fact, existing gaming revenues will provide the approximately $43.2 million in annual payments on the bonds.

The ad begins with a voice-over asserting that “red ink is rising in Des Moines” and later shows a woman saying, “Stop the red ink.” Those statements, along with the cartoon of red ink drowning Culver and the capitol, wrongly suggest that the infrastructure borrowing is deficit spending.

The second part of the ad promises that Burgmeier will vote for a new budget law “to make it harder to waste tax dollars.” I’d like more details about how such a law would work, and I’d also like Burgmeier to specify which of these investments he considers wasteful.

The ad promises Burgmeier will “serve as a check and balance to Governor Culver’s runaway spending” and closes by saying Burgmeier will bring “balance and spending restraint back to our government.” Iowa Republicans may believe Culver is very unpopular in district 90, or they may have decided to run against him in order to rile up their base. It’s notable that the ad never uses the word “Republican” and doesn’t identify the candidate’s political party. I guess the outside interest groups running the Burgmeier campaign don’t have much confidence in the Republican brand to carry the day.

The Iowa GOP didn’t announce the size of the ad buy, which networks would run the ad or which programs have been targeted. If you live in the viewing area for this district, let us know whether you’ve seen the ad, and if so during which television shows. If you prefer not to post a comment here, you can send me a confidential e-mail at desmoinesdem AT yahoo.com. Please also report on any radio ads you’ve heard.

I’m curious to see whether this will be Burgmeier’s only television commercial or if his campaign will mention other issues, including same-sex marriage, in later ads.

Having spent no time in this district lately, I have no idea whether Burgmeier or Democrat Curt Hanson has an edge. Political scientists will tell you that as a general rule, the party out of power does well in low-turnout by-elections and special elections. Both Democrats and Republicans are working hard to get out the vote in district 90. State GOP Chairman Matt Strawn and some other Republicans view this race as a must-win.

Share any relevant thoughts in this thread.

Iowa is top-ranked state on workers' comp

I saw on the Iowa House Democrats’ blog that the Work Loss Data Institute recently released “2009 State Report Cards for Workers’ Comp, using the most current data available at this time.” Excerpt from the summary:

Similar to past releases of this report, the 2009 State Report Cards also provide five different outcome measures compared among the states for each year: (1) Incidence Rates, (2) Cases Missing Work, (3) Median Disability Durations, (4) Delayed Recovery Rate; and (5) Key Conditions: Low Back Strain. An essential requirement for production of this report was the proprietary crosswalk program that has been developed by Work Loss Data Institute, which converts OSHA-reported data into an ICD9 code format.  More details on the methodology used are located at http://www.odg-disability.com/…  

Iowa performed the best of all the states for 2006 and Minnesota came in a close second. Both states received a grade of “A+” based on an average of their 2006 scores in the five categories above. Illinois came in last, with Wyoming, Rhode Island and New York very close to the bottom. In total, nine of the 43 states received a grade of “F” in 2006. A summary of each grade for all states is shown on a U.S. Map Showing Grades by State, located at http://www.odg-disability.com/…

In terms of the tier ranking system, the Tier I states are Iowa, Kansas, Minnesota, Utah and Virginia. Tier I means that the state had an average grade of “B+” or better, and a trend going up or level. Those five states were doing great and continuing to improve.

Look for Iowa Republicans to keep claiming that this is a terrible place to do business despite the conclusions of independent analysts such as the California-based Work Loss Data Institute.

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Rants misses the point of the Power Fund

State Representative Chris Rants promised to run his gubernatorial campaign on “Diet Coke and Casey’s pizza and ethanol,” but attacks on Governor Chet Culver are the real fuel for his political ambitions. He’s been bashing Culver’s economic policies all summer. His latest target is the Power Fund, which Rants would ax to help balance the state budget.

Culver and his office have repeatedly cited a study by the Green Jobs Initiative Committee, which estimated that Iowa has more than 8,700 “green jobs,” a substantial increase in the past few years. Culver has credited the Power Fund with helping create thousands of jobs, while Rants says Culver is misleading Iowans because fewer than 100 jobs can be directly attributed to Power Fund grants.

If I were Culver, I would seize the chance to debate renewable energy with Republicans.  

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Cash for Clunkers gets $2 billion from stimulus funds

President Barack Obama signed a bill today allocating an additional $2 billion to the to the Car Allowance Rebate System, more commonly known as Cash for Clunkers. The money will come from the American Reinvestment and Recovery Act (the economic stimulus bill approved in February). The Senate approved the bill by a 60-37 vote on Thursday night. Senator Tom Harkin voted yes, and Senator Chuck Grassley, who criticized the program earlier this week, voted no.

I liked Harkin’s idea to put income limits on this program, but the Senate wanted to get this measure passed before the summer recess. If the Senate had approved a different bill from what cleared the House last week, the funding would have been delayed until September.

The Senate vote went mostly along party lines, but four Democrats joined 33 Republicans in voting no, and seven Republicans joined 53 Democrats in voting yes.

I’m pleased to learn that most consumers who have taken advantage of this program have traded in a “clunker” for cars that get significantly better mileage. (Click here for lists of the most popular vehicles traded in and the most popular purchased with Cash for Clunkers vouchers.) The way Congress wrote the bill, people could have traded in SUVs and trucks for similar vehicles with only minimal improvements in fuel economy.

Congress may extend "Cash for Clunkers" program

Huge consumer demand quickly exhausted the $1 billion in federal funds allocated to the “Cash for Clunkers” program that provides $3,500 or $4,500 vouchers to some consumers who trade in old vehicles for newer models. An estimated 250,000 Americans have taken advantage of the program already, prompting the U.S. House to vote on Friday for an additional $2 billion to extend it. All five Iowans in the House voted to fund “Cash for Clunkers” in June, but Representative Steve King (IA-05) voted no on the extra $2 billion.

Although the White House would like to extend this program, Reuters reported that the bill may run into trouble in the Senate:

One member can block a bill in the Senate and there are different interests that could pose a challenge. For instance, Energy Committee Chairman Jeff Bingaman said he opposes the House proposal because it calls for spending unused Energy Department loan guarantees on the program.

Environmental champions in the Senate have urged members to strengthen requirements in the bill for fuel efficiency and pollution control.

Energy analysts played down the impact the program would have on reducing gasoline consumption.

Conservative budget hawks could also draw the line on more help for an industry that has already received tens of billions in federal assistance.

In an ideal world, I would have liked to see “Cash for Clunkers” structured somewhat differently, but there is no question that this program has helped many people and given a slight boost to the economy. Even if the Senate does not approve the additional $2 billion, car dealers’ incentives that copy the “Cash for Clunkers” approach may continue to stimulate new car purchases.

Congressman Bruce Braley (IA-01) was one of the key House sponsors of this bill, and its popularity will probably help him if he ever runs for statewide office. People who bought new cars they otherwise could not have afforded are going to remember that for a long time.

I noticed that Congressman Leonard Boswell (IA-03) is holding a public event to discuss “Cash for Clunkers” on August 4 (Stew Hansen Dodge City Jeep on Hickman in Urbandale, 9 am).

Share any thoughts about this program or stories about people who have benefited from it in this thread.

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"Cash for Clunkers" goes into effect

The Car Allowance Rebate System, also known as “Cash for Clunkers,” goes into effect today. The National Highway Traffic Safety Administration is running the program, which received $1 billion in funding from the supplemental war funding appropriations bill Congress passed in June. Congressman Bruce Braley (IA-01) was among the key House sponsors of this program.

The Quad-City Times praised Braley’s “collaboration and innovative work” on this bill and recapped the guidelines:

$3,500 voucher

– New vehicle must get at least four miles per gallon more than the trade-in.

– A new truck must get at least 2 miles per gallon more.

$4,500 voucher

– The new car gets at least 10 miles per gallon more than the trade-in.

– The new mini-van, small truck or SUV gets at least five miles per gallon more than the trade-in.

– The new full-size pick up or cargo van rated at 15 miles per gallon or more, gets at least two more miles per gallon than a similar trade-in.

Condition of the trade-in:

– Must be driveable

– Have been owned and insured for at least a year.

– Any vehicle built after mid-1984; or a large work truck no newer than 2001.

– Any Category 1 or 2 vehicle (car, minivan, SUV, light pick up) with a combined MPG of 18 or less. This does not apply to category 3 trucks (large pickup trucks and cargo vans).

This website answers some frequently-asked questions about the program in greater detail.

I’ve been hearing radio ads in central Iowa suggesting that some car dealers will match what customers get from the government through the “Cash for Clunkers” program. New car sales have fallen dramatically during this economic recession.

I would have liked to see this bill focus more on energy efficiency, but Braley’s work was well-intentioned. This program should boost sales for automakers while helping a lot of consumers.

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Iowa Republicans still wrong on the economy and I-JOBS

The business network CNBC threw a wrench in the Republican sound bite machine yesterday by ranking Iowa the fourth best state in the country for doing business. Click the link to read Iowa’s scores for 2008 and 2009 in the ten different categories CNBC considered in compiling these rankings. (Iowa ranked ninth overall in 2008.) You can also watch the CNBC segment here.

Iowa improved in almost all of CNBC’s categories from 2008 to 2009. The biggest improvement was in the “economy” category, where Iowa went from 29th in 2008 to 4th in 2009, even as the national recession deepened. While the recession is hurting Iowa along with every other state, we are doing reasonably well under the circumstances. CNBC also moved Iowa up quite a few notches under “technology and innovation” and “transportation and infrastructure.” We have a ways to go to reach the top-ranked states in those areas, which is why the Culver administration is smart to be investing heavily in our infrastructure with the I-JOBS bonding program.

Speaking of I-JOBS, now that most of the bonds have been sold, money is starting to be awarded:

Every city and county in Iowa will receive a portion of $45 million in additional funding under I-JOBS for local street and road projects. These funds will begin being distributed to cities and counties starting next Tuesday.

In addition, $50 million in I-JOBS funds will improve 55 state highway system bridges in 29 counties across the state. Projects in the metro Des Moines area include two I-35 bridges over the Iowa Interstate Railroad, the Iowa 17 bridge over the Des Moines River, and U.S. 69 bridge over Scott Avenue.

Scroll to the bottom of this page to find links to pdf files containing a “list of I-JOBS road funding amounts for all Iowa cities and counties, as well as bridge projects.”

Meanwhile, Iowa Republicans continue to proudly oppose the I-JOBS program. Today Senate minority leader Paul McKinley and others are triumphantly Twittering about an article in the Des Moines Register: Economists question impact of I-JOBS plan. My response is after the jump.

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More details on extra help for Iowa's unemployed

I recently discussed how Iowa is fully utilizing federal stimulus funds to expand unemployment benefits, unlike many other states, which are leaving all or part of that money on the table.

The Iowa Senate highlighted steps taken during the 2009 session to extend unemployment benefits, which went into effect on July 1:

· Improving and expanding services for unemployed Iowa workers. By making reforms to Iowa’s unemployment insurance program, our state will receive $70.8 million from the federal government to extend benefits for unemployed workers in training programs. It makes sense to support Iowans who are trying to upgrade their skills by attending community college and other types of training.

· Paying unemployment claims for replacement workers who become unemployed when Iowa National Guard and Reserve members return to their local jobs after active duty. When our soldiers come home, the state should help the replacement workers without penalizing employers.

· Providing $18.9 million to workforce field offices across Iowa. Iowa has 55 workforce centers, which provide job counseling, training, placement and other assistance. These services help laid off workers move forward and help local businesses find the employees they need.

For more details, read the full text of Senate File 197 here.

Note: the $70.8 million in federal funding for expanded unemployment benefits came from the economic stimulus bill, or American Reinvestment and Recovery Act. All House Republicans, including Iowa’s Tom Latham and Steve King, voted against that bill, as did almost all Senate Republicans, including Chuck Grassley.  

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Iowa taking full advantage of stimulus unemployment funds

When Congress was debating the stimulus bill earlier this year, Mark Zandi, the chief economist for Moody’s, compared various forms of government spending and tax cuts in terms of economic stimulus “bang for the buck.” He concluded (pdf file) that various forms of government spending did more to stimulate the economy than various kinds of tax cuts.

The best kinds of spending in terms of stimulative effect were food stamps and extending unemployment benefits. Every extra dollar the federal government spends on food stamps generates approximately $1.73 in economic activity, and every dollar the federal government spends to extend unemployment benefits generates approximately $1.63 in economic activity. People who need these services are likely to spend additional money quickly, helping preserve jobs in the retail sector.

With this in mind, you might imagine that the states would take full advantage of money allocated to unemployment benefits in the American Reinvestment and Recovery Act. But you would be wrong, according to this article by Olga Pierce from ProPublica:

So far, only about half of the $7 billion included in the stimulus package [for expanding unemployment insurance] has been claimed by states. […]

Four states have explicitly rejected the funding, but many others have so far failed to pass legislation qualifying them for incentive payments. […]

Under the stimulus bill [2], states can qualify for the extra funding by extending unemployment insurance to new categories of workers. To receive a third of the funding, they must begin using something called an alternative base period, which would allow more low-wage workers to receive unemployment benefits. […]

To get the other two-thirds of the cash, they must adopt at least two other changes from a list that includes covering part-time workers and offering $15 extra per week for each dependent.

If states meet the requirements, they qualify for a federal lump sum payment that will cover the cost of expansion for at least three years, or longer in many cases. It was on those grounds – that after the federal funding runs out states will have to find another way to cover the cost – that Louisiana Gov. Bobby Jindal [3], Mississippi Gov. Haley Barbour [4] and others [5] that said they would reject the funding.

Bleeding-heart liberal that I am, I believe basic fairness justifies extending unemployment benefits to more part-time and low-wage workers. But even if you don’t care about fairness, Zandi’s analysis shows that extending unemployment benefits will get money circulating in the economy.

Click here for a map and a chart showing how much federal unemployment money each state has claimed.  

As of mid-June, 17 states had claimed none of the stimulus funding for unemployment benefits, and another 12 states and the District of Columbia had claimed only part of that money. In some of those states, Democrats are in charge. Progressives who have ridiculed Republican governors for rejecting stimulus money for unemployment benefits should also hold Democrats accountable on this score.

Fortunately, Iowa is among 21 states that have fully used these stimulus funds as Congress intended. Thousands of Iowans struggling to get by will benefit from the $70.8 million the stimulus bill appropriated to our state for unemployment benefits. Democrats in the state legislature and Governor Chet Culver deserve credit for enacting the necessary legislative changes to collect this funding.

Many of the states that have left stimulus money on the table have significantly higher unemployment rates than Iowa, by the way.

Speaking of boosting the economy, Zandi’s report showed that infrastructure projects were the third-most stimulative form of government spending. Every extra dollar spent on infrastructure generates an estimated $1.59 in economic activity. Remember that next time Iowa Republicans bring out their misleading talking points about the the I-JOBS program. Also remember that Iowa has used the stimulus bill’s transportation funding wisely compared to many other states, according to a recent review by Smart Growth America.

In contrast, most kinds of tax cuts Republicans advocate generate less than one dollar of economic activity for every dollar they cost the government. As a gesture to Republicans, Democrats replaced some spending in the stimulus bill with $70 billion allocated to fixing the alternative minimum tax, even though Zandi’s analysis found that a dollar spent on fixing the alternative minimum tax generates only about 49 cents in economic activity.

It’s too bad the Obama administration made a number of concessions to Republicans on the stimulus bill. Like Bob Herbert wrote a few months ago, when the GOP talks about the economy, nobody should listen.

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Christian Fong dusts off Obama's playbook

Given Barack Obama’s Iowa caucus breakthrough and convincing general-election victory here, it was only a matter of time before someone else built an Iowa campaign around his strategy. I didn’t count on a Republican being the first person to try, though.

Enter Christian Fong, who made the Republican race for governor a lot more interesting last week.

Some early impressions of Fong’s personal narrative, political rhetoric and electoral prospects are after the jump.  

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Smoking rate declines in Iowa

I mentioned in this post that it’s been a full year since the Iowa Smokefree Air Act went into effect. The public smoking ban was one of the most controversial bills considered during the 2008 legislative session, and advocates praised the law’s success at a press conference this week.

According to a recent Iowa Department of Public Health survey, 14 percent of Iowans smoke. In 2007, IDPH research estimated the smoking rate at 19 percent. That’s a significant decline, suggesting that around one-quarter of Iowans who smoked in 2007 have since quit. The $1 a pack tax hike on cigarettes approved in 2007 was probably a major factor in this trend as well.

The overwhelming majority of Iowa businesses are complying with the smoking ban, according to a June 30 press release from the IDPH. A little more than 1 percent of Iowa businesses with employees (1,015 to be exact) have received a “Notice of Potential Violation” from the IDPH. Of those, approximately half are bars and restaurants. I’m not surprised, since bar and restaurant owners were the smoking ban’s most vocal opponents (despite research showing that smoking bans do not hurt businesses in the hospitality industry). For those who want more details on compliance with the Smokefree Air Act, I’ve posted the IDPH press release after the jump.

Although some Democrats were angry that the legislature took on this issue last year, I’m proud to have supported the smoking ban at this blog for all the reasons I listed here.  

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Do Iowa's budget problems warrant a special legislative session?

Iowa’s 2009 fiscal year ended on June 30, and if the Legislative Service Agency’s projections are correct, net revenues will fall well short of what legislators anticipated when they approved the 2009 budget. The Legislative Service Agency puts the possible shortfall at $161 million, whereas Iowa’s budget director Dick Oshlo says things don’t look that bad:

Total gross receipts for FY 2009 are $6.921 billion, which is only $57.7 million lower than the Revenue Estimating Conference’s official estimate of $6.979 billion.

Dick Oshlo, state budget director, said: “With yesterday marking the end of the fiscal year, we now know the state’s gross receipts for FY 2009. While the state’s tax receipts deteriorated more than expected during the last two months of the fiscal year due to the ongoing effects of the national economic recession, this is a manageable number. Fortunately, receipts improved during the final days of June.  At this point we see no legitimate reason for a special session to balance the state’s budget.”

Meanwhile, Republican State Representative and gubernatorial candidate Chris Rants says Governor Chet Culver should call legislators back to the capitol:

“It is time to quit worrying about the political ramifications of admitting that we have a deficit and get about the business of fixing it,” Rants said. “Gov. [Tom] Vilsack put aside partisan politics and called a special session in 2001 and 2002 to balance the budget after revenues declined. Culver needs to do the same.”

I wasn’t living here during Vilsack’s first term and don’t know how bad the projected shortfalls were in those years, compared to what Iowa is facing now. Culver’s office argues that we won’t know the real picture for a while yet:

The LSA’s figures are just estimates, and true net receipts won’t be known until September when the Department of Management closes the books on the fiscal year 2009 budget.

There is also revenue that will be collected within the next 90 days but allocated to the fiscal year that ended Tuesday, money that will improve the state’s financial situation and is not included in the LSA projections.

Culver Press Secretary Troy Price told the Iowa Independent last month that until accruals, expenditures and refunds are all taken into account there is no way of getting an accurate picture of the 2009 budget.

Like Chris Woods, I felt a special session was warranted last year to address flood relief and recovery issues, but that never happened. Incidentally, many Iowa Republicans opposed calling the legislature back in response to the flooding.

I’d like to hear from others in the Bleeding Heartland community. Should Culver call legislators back in light of the possible budget deficit?

I’ll update this post later today after Culver’s press conference with State Treasurer Mike Fitzgerald. According to Lynn Campbell of IowaPolitics.com, they will discuss the budget and “new info” on state finances.

LATE UPDATE: Forgot to update yesterday. As you can see from ragbrai08’s comment below, Vilsack called a special session in October 2001. Like Culver, he waited until all the numbers were in (rather than calling the legislature back shortly after June 30). It’s quite misleading for Rants to suggest Culver is being less prudent here than Vilsack.

At yesterday’s press conference, Culver said he is “very confident” the 2009 budget is balanced. He and Fitzgerald emphasized Iowa’s AAA bond rating:

“In a very partisan way, the Republicans running for governor are misleading people,” Culver says. “…So I think it’s very important to make sure that we hold those people accountable that are misleading Iowans. It’s just not fair. It’s not appropriate and there’s no need for alarm.” […]

Culver is also stressing that the Wall Street firm “Standard and Poors” just “reaffirmed” Iowa’s triple-A bond rating.

“What a timely testimonial from (Standard and Poors.)  They’re just looked at our books inside and out,” Culver says.  “They’ve looked at our debt.  They’ve looked at our revenue streams.  They’ve determined…that Iowa is one of the best-managed states in America.”

That triple-A bond rating (the highest on the Standard and Poors scale) means Iowa will be able to borrow money for the I-JOBS program at favorable interest rates.

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Iowa Republicans more like "Party of Hoover" than party of future

The Republican Party of Iowa is celebrating its “rising stars” tonight at an event featuring Mississippi Governor Haley Barbour. Judging by what we’ve heard lately from Iowa GOP leaders, they’re gonna party like it’s 1929.

Case in point: Iowa Senate Minority leader Paul McKinley. The possible gubernatorial candidate’s weekly memos continue to whine about spending and borrowing by Democrats (see also here). Republicans would rather slash government programs and provide “targeted” one-year tax credits.

The lessons of Herbert Hoover’s presidency are still lost on these people. I apologize for repeating myself, but excessive government spending cuts can turn an economic recession into a depression. Since state governments cannot run budget deficits, it makes sense for the federal government to help the states “backfill” their budgets. That was the express purpose of the state transfer funds in the stimulus package.

In addition, it is prudent to spend federal funds on projects with long-term benefits. Energy Secretary Steven Chu was in Des Moines on June 23 to highlight the first installment of what will be $41 million in stimulus funds for renewable energy and energy-efficiency projects in Iowa. Energy efficiency programs in particular will have huge collateral benefits, saving consumers money while helping the environment.

No matter how many times Republicans repeat their misleading talking points about the I-JOBS state bonding initiative Democrats passed this year, it is prudent to borrow money for worthwhile projects when interest rates are low. I don’t hear McKinley or other Republican leaders telling businesses not to borrow money to make capital improvements.

Share any thoughts about Republican ideas, rhetoric, or career lobbyist Haley Barbour in this thread.

Infrastructure spending needs strong oversight

All government spending on infrastructure is not created equal. With good planning and accountability measures, the federal stimulus and state bonding packages approved this year by Congress and the Iowa legislature could turn out to be wise investments with long-term benefits. Without proper monitoring, we could squander lots of borrowed federal and state money.

Laura Dean of the Huffington Post drew my attention to the Project on Government Oversight‘s review of state websites on the American Recovery and Reinvestment Act (the official name for the stimulus bill). They were specifically looking for resources for those who want to report fraud, waste and abuse in how federal stimulus funds are being used.

The findings are summarized here. Iowa did well as one of only seven states that “listed clear procedures for whistleblowers, such as what information to report, who to report to, and what will be done with that information.” (“Report stimulus fraud” is right on the front page of Iowa’s site, in the “featured links” section.)

However, there’s always room for improvement. The Project on Government Oversight applauded a few especially “whistleblower-friendly websites”:

Tied for first prize were Florida and Georgia, whose sites did an excellent job of providing clear procedures and protections for whistleblowers. Next up were Maine, Connecticut, and Texas, whose websites all did a good job of making the whistleblower’s job just a little bit easier.

Perhaps the webmaster for Iowa’s site on federal stimulus spending can make a few changes based on the Project on Government Oversight’s recommendations (pdf file).

As for state spending on infrastructure, the I-JOBS board will choose projects to receive funds soon. The criteria for selection are clear, and state officials understand the need for transparency in the process. Once the money has been allocated, the I-JOBS website should make it easy for citizens not only to track how the money is being spent, but to report any suspected fraud, waste or abuse.

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Republicans still don't get the point of the stimulus

The Republican Party opposed President Obama’s economic stimulus bill earlier this year, instead advocating a federal spending freeze in response to the recession. The misguided Republican proposal would have repeated Herbert Hoover’s big mistake, ignoring consensus among economists that deficits help end recessions.

The stimulus bill wasn’t perfect, but it contained some valuable provisions, notably aid to state governments, which can’t run deficits. While Governor Chet Culver imposed two rounds of cuts to fiscal year 2009 spending, federal stimulus funds helped lessen the severity of those cuts and avoid drastic reductions in the 2010 budget.

That’s good, because state budget cuts can further weaken an already weak economy, as the Center on Budget and Policy Priorities explained in this review of state fiscal stress across the country:

When states cut spending, they lay off employees, cancel contracts with vendors, eliminate or lower payments to businesses and nonprofit organizations that provide direct services, and cut benefit payments to individuals. In all of these circumstances, the companies and organizations that would have received government payments have less money to spend on salaries and supplies, and individuals who would have received salaries or benefits have less money for consumption. This directly removes demand from the economy. […]

Federal assistance can lessen the extent to which states take pro-cyclical actions that can further harm the economy. The American Recovery and Reinvestment Act recognizes this fact and includes substantial assistance for states. The amount of funding that will go to states to help them maintain current activities is approximately $135 billion to $140 billion – or about 40 percent of projected state deficits. Most of this money is in the form of increased Medicaid funding and a “Fiscal Stabilization Fund.” This funding will reduce the depth of state budget cuts and moderate state tax and fee increases.

Leave it to the Republicans to miss the point of stimulus aid to state governments, as I’ll discuss after the jump.

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Braley's "Cash for Clunkers" bill clears House

A bill to encourage consumers to purchase new and more fuel-efficient vehicles, co-sponsored by Congressman Bruce Braley (IA-01), passed the U.S. House of Representatives on Tuesday by a wide margin of 298 to 119, with two members voting “present.”

The roll call shows 59 yes votes from Republicans, including Iowa’s Tom Latham (IA-04) and Steve King (IA-05). Leonard Boswell (IA-03) also voted for the bill. Braley and Dave Loebsack (IA-02) were not present for the roll call, but it’s safe to assume that Loebsack would have voted for it, since only a handful of the most conservative House Democrats voted no.

Braley said in a statement,

“The passage of Cash for Clunkers legislation will help boost our economy, save families money, and reduce our dependence on foreign oil,” Braley said.  “Cash for Clunkers is a common-sense idea that can have a big impact on the economy, reducing emissions and saving American jobs by jumpstarting the auto industry.  I hope the passage of this bill today is a sign that this program will start benefiting families and American workers as soon as possible.”

In my opinion, this bill has much more potential to spur new car purchases and save jobs than it does to reduce emissions or our dependence on foreign oil. The increased fuel-efficiency requirements are quite modest (presumably because American car manufacturers have done a poor job of increasing fuel efficiency).

The original draft of the bill set more ambitious mileage requirements, but that changed during negotiations over the Waxman-Markey climate-change bill, to which this measure was attached:

The compromise also waters down the so-called cash-for-clunkers program*, which ostensibly encourages drivers to turn in their gas guzzlers in exchange for a federal subsidy on more fuel efficient models. Yet under the compromise proposal, the new fuel efficiencies are hardly dramatic. For example, drivers trading in trucks between 6,000 and 8,500 pounds would be eligible for a $3,500 voucher for purchasing the same-sized vehicle that’s more efficient by just 1 mile per gallon.

Daniel Becker, director of the Safe Climate Campaign, said the program does much more to help struggling automakers sell large, unpopular models than it does to reduce greenhouse emissions.

“It’s a $4 billion giveaway to move gas guzzling vehicles that nobody wants off the lots,” Becker said.

After the jump I’ve posted the press release from Braley’s office and the information from an accompanying fact sheet on how this bill would work.

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I-JOBS board agrees on draft rules and timeline

The I-JOBS board met for the first time on June 3. According to this news release,

The I-Jobs Board is specifically tasked with awarding approximately $165 million of funds from the I-Jobs program. Of  that amount, $46.5 million is earmarked for projects in Linn County, Cedar Rapids, Palo, Elkader and Charles City. The  remaining $118.5 million will be available on a competitive basis to support the construction of projects relating to  disaster relief, mitigation and local infrastructure.

The board approved this tentative timetable for allocating the money. The key date is August 3, when applications are due. As Governor Chet Culver’s deputy chief of staff Phil Roeder told Iowa Independent,

“Everyone in the administration understands that with I-JOBS, time is of the essence,” Roeder said. “In order to have impact on the economy, we have to move quickly.”

I was pleased to see Roeder highlight the importance of transparency for the I-JOBS program. The administration is creating a website that supposedly will allow the public to track how money is being spent. I strongly agree with Kathleen Richardson, director of Iowa Freedom of Information Council, who emphasized the need for the I-JOBS board to follow open meetings rules as well.

Citizens can find draft rules for the I-JOBS program here. You can send comments about these rules to ijobs@iowa.gov.

Meanwhile, Iowa Republicans continue to bring out their misleading talking points, such as this Twitter comment from IowaGOP,

Culver keeps pumping I-JOBS (1st mtg. today.) But how will it help create and keep long-term jobs in IA? Still haven’t heard.

How the program will create jobs should be obvious when you read which kinds of construction projects are eligible for the money (such as roads, bridges, sewers, repairing flood-damaged structures). As for how these public works will keep jobs in Iowa, what part of “quality of life” do Republicans not understand? Also, expanding broadband access in rural areas will allow more Iowans to operate internet-based businesses.

Even Iowa State Economics Professor David Swenson, whom Republicans like to quote on this subject, estimates that the I-JOBS program will create around 4,050 jobs.

Funny, Iowa Republicans don’t acknowledge Swenson’s insight when it comes to ending federal deductibility, which he considers an “archaic holdover” in our state’s tax system. But that’s a point for another post.

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Dave Murphy is working to strengthen rural economies

The Des Moines Register profiled Dave Murphy of Food Democracy Now in Monday’s edition. The article mentioned the incredible success of the petition signed by more than 94,000 Americans. Two of the “sustainable dozen” candidates whom Food Democracy Now recommended for U.S. Department of Agriculture posts now work for the department. Drake Law Professor Neil Hamilton, also on the sustainable dozen list, is an “informal adviser” to Secretary of Agriculture Tom Vilsack.

You should read the whole Des Moines Register article. The most important passage is about how Murphy makes the case for changing agriculture policies:

[Murphy] pointed to a survey from the Organic Trade Association that showed that the U.S. sales of organic food grew nearly 16 percent between 2007 and 2008 to reach $22.9 billion. Organic foods now account for about 3.5 percent of all U.S. food sales.

For Murphy, sustainable farming is about more than the food.

He sees it as returning to a model of production that is better for the environment and one in which farmers can start without taking on deep debt to finance heavy equipment.

He said the agricultural policies today are stacked against farmers of small- to mid-sized farms in favor of larger operations. […]

Murphy stressed that he isn’t against large farm operations. He said sustainable practices can help farms of all sizes.

But Murphy does believe that the playing field ought to be leveled, for the benefit not just for smaller farms but for rural areas in general.

“That’s the best way to improve rural economies,” he said. “The more farmers there are on the land, the better it is for rural economies.”

Health and environmental concerns sparked my interest in buying local food produced sustainably, but Murphy is wise to connect the dots between agriculture policies and the economic future of rural areas. For more along those lines, read the feature on Murphy and Food Democracy Now from the Washington Post in March.

Speaking of Iowans who are incredibly committed to helping small and medium-sized farms thrive, Woodbury County’s rural economic development director Rob Marqusee has pledged to “eat only food grown within 100 miles of the Woodbury County Courthouse for the entire month of June 09 (and no meat will be allowed in the diet).” Keep an eye on Marqusee’s Woodbury Organics site next month, because he’ll be blogging about his food challenge.

Those interested in Murphy’s work should go read more on the Food Democracy Now site. Click here for past Bleeding Heartland posts that referenced Food Democracy Now’s work. Jill Richardson wrote more here about Murphy’s activist roots and the role he played during the Iowa caucus campaign.

If organic farmer Francis Thicke decides to run for Iowa secretary of agriculture in 2010, expanding local food networks will be a major theme of his campaign.

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Cleaner water: tangible benefit of stimulus and bonding bills

Water quality has long been one of Iowa’s biggest environmental problems. Fortunately, the state plans to spend some $455 million cleaning up Iowa rivers and lakes, according to an excellent piece by Perry Beeman in the May 10 edition of the Des Moines Register:

After decades of struggling to address serious pollution problems, the state now has an unprecedented pool of state and federal money to solve some of its worst water-quality problems, said Charles Corell, the water chief of the Iowa Department of Natural Resources.

One of the biggest impacts: improved sewage treatment and septic systems in the 500 towns and rural subdivisions that don’t have any. […]

Much of the new money for water quality was approved last month by the Iowa Legislature as part of a huge bond package pushed by Gov. Chet Culver. Other money was awarded as part of flood recovery efforts.

Money for lake restorations – including popular spots like Clear Lake in Cerro Gordo County and Carter Lake in Pottawattamie County – will more than quadruple. Many predict the much larger pool will fuel recreation opportunities and improve local economies. […]

“You essentially have untreated or under-treated sewage getting into waterways,” said Corell, who visited Truesdale and Greenville on Thursday to discuss proposed sewer projects. “And it’s all the time, not just when it rains.”

After the jump I have posted details Beeman compiled about the new money that will be used to improve water quality in Iowa. A large sum came from the federal economic stimulus bill, which didn’t get a single Republican vote in the House of Representatives. Another major source is the I-JOBS bonding initiative, which passed the Iowa House and Senate last month with no Republican votes.

Republicans keep bashing the federal stimulus spending and the state-level borrowing, as if no Iowans will benefit from these policies (aside from the few thousand people who will work on the projects). One typical example was the e-mail blast Iowa Senate Republican leader Paul McKinley sent out last week. You won’t find it on the comically awful Iowa Senate Republicans website, which appears not to have been updated since April 16. However, I receive “McKinley’s Memos” via e-mail, and I’ve posted the May 15 edition after the jump to give you a flavor of current Republican ideology.

I addressed most of the points McKinley raises in this post. The Party of No’s indiscriminate stance against borrowing fails to recognize that when interest rates are relatively low, bonding to pay for worthwhile projects is a wise investment. It may be hard to assign a dollar value to reducing water pollution in Iowa, but that doesn’t mean it’s not important for human health, biodiversity and local economies.

Hundreds of thousands of Iowans will benefit from the clean water projects discussed in Beeman’s article. If Republicans had their way, the sewer improvements and lake cleanups wouldn’t happen for years, if ever.

Please share your own thoughts about penny-wise and pound-foolish conservative dogma in this thread.

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Eat pork that's not factory-farmed

Government officials and pork industry representatives are working hard to convince the public that it’s still safe to eat pork despite the rapidly spreading swine flu virus that may have already infected two Iowans.

They are correct that there is no risk of contracting the flu from eating pork.

Some Mexican news reports have linked the swine flu outbreak to conditions in factory farms owned by the Smithfield Foods corporation. Smithfield released a statement saying the company “has no reason to believe that the virus is in any way connected to its operations in Mexico.” However, many commentaries have highlighted the ways that confined animal feeding operations (CAFOs) may contribute to the spread of disease. See this post by Ellinorianne or articles linked in this post by Jill Richardson.

Whether or not the swine flu outbreak is ever conclusively linked to CAFOs, there is already overwhelming evidence of problems with the current model for raising hogs industrially. Charles Lemos briefly covered them in this post. For more detail, read last year’s report by the Union of Concerned Scientists: CAFOs Uncovered: The Untold Costs of Confined Animal Feeding Operations. Also last year, the Pew Commission on Industrial Farm Animal Production issued its final report on “Putting Meat on The Table: Industrial Farm Animal Production in America.”  The authors concluded that “The current industrial farm animal production (IFAP) system often poses unacceptable risks to public health, the environment and the welfare of the animals themselves […].” There are many resources on the Save Antibiotics site as well.

For some people, including April Streeter of the Treehugger blog, problems with the CAFO model warrant giving up pork altogether.

I would encourage those who enjoy pork to choose meat from sustainable producers instead. Depending on where you live, it may be hard to find pork that hasn’t been factory-farmed because of the massive consolidation in the pork industry during the past decade or two (see also here).

Central Iowa residents are fortunate to have the Iowa Food Cooperative close by. Several different farmers raising hogs organically, or on pasture without hormones and antibiotics, sell a wide range of pork products through the coop.

If you don’t live near a store or market that sells sustainable meat, an advocacy organization such as Practical Farmers of Iowa, the Iowa Network for Community Agriculture or the Women, Food and Agriculture Network may be able to put you in touch with a farmer who sells pork directly to consumers.

Sustainable meat can be expensive, but you can reduce the cost by buying directly from the farmer. If you have a chest freezer and buy in large quantities, the price per pound can drop down into the range you would pay for lower-quality conventionally raised meat.

UPDATE: Jill Richardson linked to an interview Secretary of Agriculture Tom Vilsack gave CNN today, in which he talked about eating pork every day. Vilsack echoed industry talking points about how the media should be calling this virus by its scientific name, H1N1, instead of using the term “swine flu.” I agree with Jill:

Whether or not this flu came from a factory farm, I don’t think the fact that factory farms are a problem is really up for debate. Vilsack comes from a state totally overrun by them so he should know best.

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Obama's budget splits Iowa delegation on party lines

The U.S. House of Representatives approved President Barack Obama’s proposed $3.55 trillion 2010 budget on Thursday by a vote of 233 to 196. As you can see from the roll call, all three Democrats representing Iowa voted for the budget: Bruce Braley (IA-01), Dave Loebsack (IA-02), and Leonard Boswell (IA-03). Every House Republican voted against Obama’s budget, including Tom Latham (IA-04) and Steve King (IA-05).

Twenty House Democrats joined Republicans in voting against the budget (Dennis Kucinich plus a minority of the Blue Dog caucus). But it’s notable that most Blue Dogs, like Boswell, supported this budget. Obama has met twice with the Blue Dog caucus this year, most recently on March 30.

House Republicans offered an alternative budget proposal with all kinds of crazy ideas in it, like privatizing Medicare, giving the wealthy more tax cuts, and freezing most non-defense discretionary federal spending. As you can see from the roll call, Tom Latham was among the 28 Republicans who joined House Democrats in voting down the GOP budget alternative. Steve King was among the 137 Republicans who voted yes.

White House officials were right to mock the GOP’s budget alternative as a “joke.” Freezing federal spending is a good way to turn a severe economic recession into a depression.

Soon after the House budget vote, I received press releases from the Democratic Congressional Campaign Committee slamming Latham and King for voting against a wide range of tax cuts contained in the budget resolution. I’ve posted those after the jump.

I suspect that the the DCCC is not putting out statements attacking the House Democrats who voted against the budget, and I’m seeking a comment from their communications staff about whether my hunch is correct. DCCC chair Chris Van Hollen warned on Thursday that liberal groups supporting primary challengers against unreliable House Democrats could cost the party seats in 2010. I wonder why we are supposed to look the other way when members of our own party take positions that the DCCC finds atrocious in House Republicans.

Meanwhile, the U.S. Senate approved a 2010 budget resolution late on Thursday after a nearly 12-hour marathon of votes on various amendments. David Waldman (formerly known as Kagro X) gives you the play-by-play from yesterday’s Senate action at Congress Matters. The final vote in the Senate was 55-43 (roll call here). Iowa’s Tom Harkin voted yes, along with all Senate Democrats except for Evan Bayh of Indiana and Ben Nelson of Nebraska, who voted with Republicans, and Robert Byrd of West Virginia, who did not vote. The 41 Senate Republicans, including Iowa’s Chuck Grassley, voted no.

CNN went over the key similarities and differences between the House and Senate budget resolutions. Most important difference, in my opinion:

[House Democrats] also included language that allows for the controversial procedure called “budget reconciliation” for health care, a tool that would limit debate on major policy legislation.

Senate Democrats did not include reconciliation in their version of the budget. The matter is guaranteed to be a major partisan sticking point when the two chambers meet to hammer out a final version of next year’s spending plan. If it passes, it would allow the Senate to pass Obama’s proposed health care reform without the threat of a Republican-led Senate filibuster.

Notably, both the House and Senate budget bills “do away with Obama’s request for an additional $250 billion, if needed, in financial-sector bailout money.” Thank goodness for that.

Any comments or speculation regarding federal tax or spending policies are welcome in this thread.

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What If The Middle Class Ruled?

President Obama is bravely captaining our economic ship. Where the last president balked at an aggregate demand-increasing stimulus and a meaningful overhaul of the automobile industry, Obama steered a $787 billion stimulus through Congress and threw car industry veteran Rick Wagoner overboard. Obama’s paradigm-shifting budget is likely to sail, relatively unscathed, through Congress in the next week. Meanwhile, Congress has filled in some rather important details, taking responsibility for successfully expanding children’s health insurance and strengthening safeguards for fair pay.

But TheMiddleClass.org’s 2008 Middle-Class Scorecard, a congressional accountability project sponsored by the Drum Major Institute, shows that several of the more basic protections for middle-class Americans – what I would like to call “low-hanging fruit” – are still unresolved, even as Congress takes on large-scale reform projects like a health care overhaul and climate change legislation.

In 2008, legislation imposing stricter regulations on credit card companiesallowing bankruptcy judges to modify the terms of primary mortgages in bankruptcy stalled in Congress, while legislators resisted including improvements to food safety regulations in a bill strengthening the Consumer Product Safety Commission. These legislative failures have had serious consequences for middle-class Americans: interest rate hikes that the Credit Cardholders’ Bill of Rights would have prohibited are instead proliferating; the 800,000 homes that would have been saved from foreclosure by the bankruptcy provision are still in danger; and Salmonella-tainted peanut butter has killed nine people and infected almost 700.

Congress is, indeed, addressing each of these issues. Markups of legislation strengthening credit card regulations are scheduled for this week in both the House and the Senate, the House passed a bill including the mortgage modification provision earlier this month, and proposals for food safety reform are solidifying.

Yet, the TheMiddleClass.org Scorecard urges caution. Only 38% of the Senate – and no Senate Republicans – voted in favor of bankruptcy modification; 74% of the House (only 43% of House Republicans) voted for the Credit Cardholders’ Bill of Rights’, but the legislation was left to die by the Senate. Other measures that would have benefitted the middle class were subject to similarly chilly receptions, with important legislation to bail out the auto industry receiving support just above 20% from Senate and House Republicans. Only 60% of all House members voted in favor of legislation that extended unemployment insurance and established a new GI Bill.

The complexity of the economic and financial crisis Americans are now experiencing does not make commonsense protections for consumers and homeowners any less important. In fact, as the crisis deepens, such protections become even more important as struggling companies try to squeeze the last pennies from vulnerable consumers. But as TheMiddleClass.org Scorecard demonstrates, protections for middle-class Americans are often talked about in Congress, but never fully addressed. Lawmakers should use the current crisis as an opportunity to usher in a new era of middle-class American rule. Next year’s Scorecard should show all legislators voting in favor of strengthened credit card regulations, bankruptcy modification for primary residences, and a food safety overhaul.

Remember the economic case for healthy food

The Washington Post ran a feature in Wednesday’s edition about Iowan Dave Murphy, who founded Food Democracy Now in November. The whole piece is worth reading, but I particularly liked this passage about what Murphy is bringing to the sustainable food movement:

Perception gets you in the door in Washington. But it’s policy that keeps you in the room. The laws that govern food policy, such as the nearly $300 billion Farm Bill and the Child Nutrition and WIC Reauthorization Act that funds the school lunch program, are notoriously complex and political. “As a movement, we have not had nearly enough sophistication on policy,” [author Michael] Pollan said. “We’ve been outgunned by people who understand the Farm Bill.”

Equally important, Murphy says, is to recast the debate about good food from a moral battle to an economic one. Take the school lunch program, which Congress will review this year. Food activists have long argued that more fruits and vegetables from local producers should be included to help improve childhood nutrition. But Murphy says the better way to sell the idea to legislators is as a new economic engine to sustain small farmers and rural America as a whole. Talk about nutrition and you get a legislator’s attention, he said. “But you get his vote when you talk about economic development.”

Murphy is realistic that change won’t come quickly. He knows he is battling huge, entrenched corporations with better connections and more resources at their disposal. To succeed, he must unite grassroots organizations and persuade an array of other interests — health insurers, senior citizens and teacher lobbies, all of which have a stake in healthful eating — to join the fight. “If you want to change the ballgame, you have to address the policies that are responsible for the system we have in place,” Murphy said. “If you change policy, the market will change.”

Economic development isn’t what sparked my interest in eating locally-produced food raised without hormones, antibiotics or toxic chemicals, but it’s definitely the key to bringing policy-makers on board.

I learned that lesson from Woodbury County rural economic development director Rob Marqusee, who talked his county supervisors into approving amazingly good policies to promote local foods and organic farming. Marqusee runs the Woodbury Organics website, a superb resource on what I call the cold-blooded capitalist case for local foods.

On a related note, look what sustainable food producers have done for the economy of Hardwick, Vermont, an industrial town that fell on hard times during the 20th century. (Hat tip to La Vida Locavore diarist JayinPortland.)

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Open thread on Obama's press conference

I’m not watching it live, but I will update this post later with some clips and commentary.

In the meantime, share your thoughts about what the president is saying tonight.

UPDATE: I am swamped with preparations for the Natural Living Expo and didn’t watch the replay of the press conference.

Sam Stein wrote up the story for Huffington Post.

TomP had an interesting take on Obama’s comments about how we should not demonize investors.

Beltway journalists seem to think the big story of the night was whom the president didn’t call on, as opposed to what he said. They do like to make everything about themselves.

SECOND UPDATE: Todd Beeton’s liveblog at MyDD was good.

More grim economic news

Sorry to bring you down on a Friday afternoon, but the Iowa Revenue Estimating Conference released new estimates today, and it ain’t pretty:

The conference estimated that the current year’s revenues will sink by $129.7 million compared to its December estimate. Revenue for the budget year that begins July 1 will drop by $269.9 million.

The drop is in addition to December’s estimates, which cut $99.5 million in the current year and $132.6 million in the fiscal year that begins July 1.

Charlie Krogmeier, Gov. Chet Culver’s chief of staff and a member of the conference, said federal stimulus money may help offset the blow but that the dramatically lower estimates will leave lawmakers with tough options.

It would be difficult to find enough job cuts and furloughs in the current fiscal year to fill the gap. The fiscal year ends June 30, in roughly 10 weeks. […]

House Majority Leader Kevin McCarthy […] and other Democratic leaders noted on Thursday that they were already planning a budget that was $130 million less than Culver’s in the upcoming fiscal year. It’s unclear how they will make up the additional $270 million loss for the current and upcoming year.

Clearly difficult choices lie ahead. I urge Iowa leaders not to implement spending cuts alone, because cutting government spending too much during a recession can make things worse.

I was encouraged to read recently that legislators are looking carefully at all of the tax incentives Iowa provides. The combined effect of all these tax incentives is larger than all state spending:

There are at least 191 tax breaks for income and sales taxes that cost or prevent Iowa from collecting almost $7.2 billion, according to a 2005 review by the Iowa Department of Revenue and Finance.

That’s more than total state spending, which is projected to be $7.1 billion next year.

Not all of these tax breaks provide good value for the lost revenue, and not all of them can be preserved with the budget shortfall we’re facing.

In other unpleasant news this Friday, the Principal Financial Group, one of Iowa’s largest employers, announced pay cuts between 2 and 10 percent, which will affect all employees, management and the board of directors. Some benefits will also be reduced.

Principal already imposed a large layoff in December, and I think they are doing the right thing by reducing pay rather than cutting more jobs now. Labor market specialists differ on whether it’s better for companies to cut pay or lay off more workers in lean times. Click here to read some arguments for reducing pay, or click here for the pro-layoff argument.

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Mother F***ing Patent Vultures

Well, I have spent the past half decade working on developing some manufacturing capability based partly on patents and intellectual product some engineer friends and I developed.

Only to find out, in the eleventh hour, after investing thousands of hours in development and tens of thousands of dollars in tooling and patent rights, that it just ain't going to happen right now.

Thanks in part to the dot com collapse, and trends established then, certain licensing firms created this idea of becoming “Non Producing Entities”, or NPE's.  These firms purchased internet and telephony patents for pennies on the dollar and waited until someone used some piece of intellectual property which infringed on the patent, or close to it. And then sued them for intellectual property infringement.

While this might not be a bad strategy in theory, in practice it has become broader and more industry wide.  Now, I am told, this practice is entering the “Green Tech” arena bigtime.

Patent Vultures, or more nicely put patent trolls have people on staff whose primary job is to search any new and innovative product against existing patents.  If there is a close fit, these entities then file suit against the company producing the item, requiring substantial litigation, with many companies simply settling out of court to reduce costs, and taking this on the chin as “the cost of doing business”.

As I was told by the patent attorney my partner is using, if we put any new product line out for sale to the general public, we will be sued.  Guaranteed. And we will have to go to court to defend ourselves. Even though some of these patents have been successfully defended in the past, and rights firmly established.

I don't have tens of thousands of dollars to spend on attorneys, so I'm pretty nervous and frustrated. Basically out of business before I can even hire anybody to produce the product.

So much for trying to save the planet and create a few jobs.

Shit.

 

A few links on unemployment and finding a job

As you can see from this graph, job losses in the current recession are worse than in other recent recessions and are continuing to accelerate at a time when the U.S. economy has already started adding jobs during the past two recessions.

Paul Krugman, who has been arguing for a much larger stimulus package, is very worried:

To see how bad the numbers are, consider this: The administration’s budget proposals, released less than two weeks ago, assumed an average unemployment rate of 8.1 percent for the whole of this year. In reality, unemployment hit that level in February – and it’s rising fast.

Employment has already fallen more in this recession than in the 1981-82 slump, considered the worst since the Great Depression. As a result, Mr. Obama’s promise that his plan will create or save 3.5 million jobs by the end of 2010 looks underwhelming, to say the least. It’s a credible promise – his economists used solidly mainstream estimates of the impacts of tax and spending policies. But 3.5 million jobs almost two years from now isn’t enough in the face of an economy that has already lost 4.4 million jobs, and is losing 600,000 more each month. […]

So here’s the picture that scares me: It’s September 2009, the unemployment rate has passed 9 percent, and despite the early round of stimulus spending it’s still headed up. Mr. Obama finally concedes that a bigger stimulus is needed.

But he can’t get his new plan through Congress because approval for his economic policies has plummeted, partly because his policies are seen to have failed, partly because job-creation policies are conflated in the public mind with deeply unpopular bank bailouts. And as a result, the recession rages on, unchecked.

At MyDD Charles Lemos wonders whether current job losses may become permanent because of the manufacturing sector’s continuing decline.

Only the biggest layoffs make headlines, as when John Deere cut 325 jobs in Dubuque and Davenport last week. But almost all of us have friends or relatives who have lost their jobs in the past six months. Thankfully, none of my recently-unemployed friends are likely to lose their homes, but lots of people aren’t so lucky. Tent cities are booming across the country.

If you are looking for work, read this piece by Teddifish on How to get a job when no one is hiring.

Daily Kos diarist plf515 just found a new job and shared some advice in this diary:

How did I get this job?

I told everyone I was looking for work!  

This particular lead came from an announcement I made on SAS-L a mailing list about software that I use.  I am a frequent contributor there, someone who has read my work saw my mention, and then forwarded me a link to a job offer. […]

But I didn’t just mention it there.  I told everyone. I wrote a diary here; and I joined dkos networking; I announced it on mailing lists; I told my friends; I told former employers; I told the guy who does our dry cleaning; I told EVERYONE.  I also left cards advertising my consulting business all over.  

Can you find a job in this economy? Well, there are no guarantees.  But, if people don’t know you’re looking, they’ll never tell you about any openings.  

MyDD user ragekage has specific advice for people pursuing a career in nursing because they think it is a “recession-proof” occupation.

This thread is for any comments about unemployment or helpful advice about finding jobs.

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How to turn a severe recession into a depression

Freeze federal spending in response to a huge spike in unemployment.

No, seriously, House Republican leader John Boehner is now proposing a federal spending freeze. Like Josh Marshall says,

I’m not even sure it’s fair to say that this is a replay of the disastrous decisions the magnified the Great Depression between 1929 and 1933. It’s more a parody of it. When the crisis is a rapid and catastrophic drop off in demand, you handcuff the one force that can create demand (i.e., the federal government) in the throes of the contraction. That’s insane. Levels of stimulus are a decent question. Intensifying the contraction is just insane and frankly a joke.

Paul Rosenberg has some good comments and a Rachel Maddow clip on this topic.

Republicans have long advocated dumb ideas on economic policy, like Congressman Steve King’s proposal to boost investment by eliminating capital gains taxes. To state the obvious, investors are not staying away from stocks because they’re worried about paying taxes on huge capital gains. On the contrary, investors fear that they will lose money because the market has not hit bottom yet and the recession will bring down more companies.

Similarly, fear of taxes on corporate profits has little to do with why businesses are not investing in production now. Business owners are not worried about finding money to pay taxes on profits. They are worried about losing money because skyrocketing unemployment reduces consumer demand for the goods or services that businesses sell.

In fairness, if we followed bad Republican advice on cutting corporate and capital gains taxes, we’d only be giving wealthy Americans tax breaks with a very small economic stimulus “bang for the buck” (see this data compiled by the chief economist for Moody’s). If we followed Boehner’s “new and improved” Republican advice to freeze federal spending, we would send the economy into a meltdown.

I have to wonder whether Republicans even believe in their own talking points. A spending freeze, really? That’s not what George W. Bush and the Republican majority in Congress did during the previous recession.

I think they may be beating the drum on spending to scare some Democrats out of supporting Obama’s budget proposal. What worries me is the scenario outlined by Open Left user Master Jack:

1. Obama submits a budget with the spending necessary to avoid a depression.

  2. Blue Dogs bitch and bleat and whine.

  3. Obama caves to the blue dogs and waters down his budget.

  4. Depression ensues.

  5. Democrats get clobbered in 2010.

  6. Liberals get blamed.

  This is what the Republicans are trying to make happen. And it wouldn’t stand a prayer of working of not for their blue dog enablers.

Democrats from President Obama on down need to push back hard against the Republicans’ idiotic new line.  

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Action: Contact Iowa legislators on energy efficiency bills

Improving energy efficiency is the fastest way to meet our baseload needs for electricity while saving consumers and businesses money and reducing greenhouse-gas emissions.

Stepping up our efforts on energy efficiency should be a no-brainer, but some utilities feel otherwise and aren’t shy about letting state legislators know.

I received this action alert from Plains Justice today:

Iowa clean energy advocates, your help is urgently needed. Two good pieces of legislation that would lower your energy bills and decrease our reliance on dirty energy are stalled in the statehouse. Unless legislators hear from you now, this money-saving legislation will die before the full House and Senate can vote on it.

House Study Bill 150 and Senate Study Bill 1191 would save you money by requiring Iowa electric and natural gas utilities to invest in strong energy efficiency programs, the cheapest and cleanest way to meet our energy needs. According to current filings before the Iowa Utilities Board, energy efficiency costs only 3 cents per kilowatt hour, while new coal generation can cost more than three times as much. Some current studies put the cost of power from new nuclear plants at 25 to 30 cents per kilowatt hour.

Energy efficiency is common sense, but some utility companies don’t want to bother. They can put more of your hard-earned dollars in their pockets if they build new coal plants and new nuclear plants instead.  Call these legislators today and ask them to move the bills forward!

Senator Mike Gronstal (SSB 1191)    mike.gronstal@legis.state.ia.us           (515) 281-4610

Rep. Pat Murphy (HSB 150)              Pat.Murphy@legis.state.ia.us             (563) 582-5922

Governor Chet Culver                        (515) 281-5211 (Please ask the Governor to tell the committee members to move the bills forward.)

Senator Jerry Behn (SSB 1191)          jerry.behn@legis.state.ia.us                (515) 432-7327

Senator Tom Hancock (SSB 1191)     tom.hancock@legis.state.ia.us            (563) 876-3219

Senator Tom Rielly (SSB 1191)         tom.rielly@legis.state.ia.us                 (641) 673-5878

Rep. Nathan Reichert (HSB 150)       Nathan.Reichert@legis.state.ia.us      (515) 281-3221

Rep. Donovan Olson (HSB 150)        Donovan.Olson@legis.state.ia.us       (515) 432-8163

Rep. Chuck Soderberg (HSB 150)     Chuck.Soderberg@legis.state.ia.us    (712) 546-6136

Rep. Nick Wagner (HSB 150)            nick.wagner@legis.state.ia.us             (515) 281-3221

The full text of HSB 150 is available at http://tinyurl.com/Iowa-HSB-150.

The full text of SSB 1191 is available at http://tinyurl.com/Iowa-SSB-1191.

Thank you for helping Iowans save money on our energy bills!

If you live in the districts of any of the above legislators, definitely call. Phone calls are harder to ignore than e-mails. However, many legislators don’t routinely return calls to Iowans who don’t live in their districts. So you might want to e-mail the people on the above list if you are not one of their constituents.

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More details on highway stimulus funds coming to Iowa

The White House released detailed information today on the $28 billion the stimulus bill directs toward highway construction. According to a press release (sorry, no link), the highway spending will “lead to 150,000 jobs saved or created by the end of 2010.” An estimated 95,000 jobs would come from the “direct impact of building new roads and fixing old ones,” while 55,000 jobs would come from “the economic activity generated when these new workers spend more than they would have otherwise.”

It is also worth noting that jobs in highway construction tend to pay better than average. The typical, or median hourly wage for all jobs in the economy was $15.10 in 2007 according to the most recent data from the Bureau of Labor Statistics. But for workers in the highway industry, the typical hourly wage was $18.31, a premium of over $3 per hour over the economy-wide median wage.

Looking more closely at different types of jobs within the industry helps to explain the difference. The median wage of blue collar, or production workers-folks who do jobs like welding and mixing-comes to about $16 per hour in highway construction compared to about $13.50 in the overall economy.

This page at Recovery.gov has a map you can use to see how much money in highway funds will go to individual states.

Iowa is slated to receive about $358 million, of which about $240 million can be used in any part of the state.

The remaining money is to be allocated as follows: $10.7 million for “mandatory transportation enhancements,” $20.8 million for use in urban areas, $73.2 million for use in suburban areas and $13.4 million for use in rural areas. (By the way, “‘enhancement’ is a legally defined term for projects such as sidewalk repairs, bicycle paths, and beautification projects.”)

Decisions within each state on where to spend the money need to be made quickly:

Parts of the allocation are set aside to make sure that urban, suburban, and rural areas alike all get a share. But since local leaders — mayors and governors — know their communities best, much of the money is left to states’ discretion. And if states don’t use it, they lose it. To make sure that funds go out quickly to give our economy the jolt it needs, states have 120 days to assign the funds to specific projects.

As a rule, federal highway funds tend to go toward new road construction, but it would be better to direct the stimulus funds primarily toward fixing the roads and bridges we have. Repairing crumbling roads and bridges improves safety, the quality of life and property values in existing neighborhoods. Building new roads stimulates sprawl without solving traffic congestion problems.

Sprawling development also increases “vehicle miles traveled” per capita and consequently greenhouse-gas emissions from cars and trucks.

Spending stimulus highway money on a “fix-it-first basis” would not only be wise, but also popular. As I mentioned in my previous post, a national survey by Hart Research Associates, released last week, found that “An overwhelming majority of Americans believe restoring existing roads and bridges and expanding transportation options should take precedence over building new roads […].”

Here’s hoping Iowa transportation officials will spend the stimulus money wisely.

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Governors can't pick and choose which stimulus money to take

State Auditor David Vaudt’s a pretty good bean-counter, but he did not read the fine print of the stimulus bill Congress recently passed. (In fairness, the document was more than 1,000 pages long.) Vaudt told the Iowa Political Alert blog that

the state should consider the nearly $1.9 billion expected to flow to Iowa through the package in cafeteria style – taking millions here but potentially leaving money on the table elsewhere if he thinks the short-term gain would give birth to unwieldy bureaucracy down the road.

“I would sort through each piece of the stimulus package and try and say ‘where does it fit Iowa the most,’” he said.

(Hat tip to Iowa Independent.)

But Senator Charles Schumer of New York has bad news for Republican governors (or in this case a would-be governor) advocating an a la carte approach to the stimulus:

As you know, Section 1607(a) of the economic recovery legislation provides that the Governor of each state must certify a request for stimulus funds before any money can flow. No language in this provision, however, permits the governor to selectively adopt some components of the bill while rejecting others. To allow such picking and choosing would, in effect, empower the governors with a line-item veto authority that President Obama himself did not possess at the time he signed the legislation. It would also undermine the overall success of the bill, as the components most singled out for criticism by these governors are among the most productive measures in terms of stimulating the economy.

Vaudt may run for governor in 2010, but I don’t give him much chance of winning a Republican primary. A few days ago he dared to suggest that Iowans may have to pay higher gas taxes in order to adequately fund road projects. That will rile up the base in the wrong way.

Speaking to Iowa Political Alert, Vaudt acknowledged that he hasn’t focused much on social issues in the past. He added that on abortion he’s a “pro-life person” who would make exceptions in the case of rape or when the mother’s life is in danger.

Correct me if I’m wrong, but I think Republican Congressional candidate Mariannette Miller-Meeks had exactly the same stance on abortion and was consequently attacked by Iowa Right to Life. Amazingly, the State Central Committee of the Republican Party of Iowa barely had the votes to censure RNC committeewoman Kim Lehman for failing to support Miller-Meeks during her campaign against Congressman Dave Loebsack last fall.

I don’t think Vaudt will satisfy the social conservatives who dominate GOP primaries in Iowa unless several candidates of the Bob Vander Plaats variety split those votes.  

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To stimulate the economy, increase food stamp participation rates

Jill Richardson’s post on extremely low food stamp participation rates in San Diego got me wondering how well Iowa does in getting eligible people enrolled in this program.

Bleeding-heart liberal that I am, I’d like to see 100 percent of people who qualify for food stamps get them, just for the sake of reducing hunger in our communities.

But let’s leave ethical concerns aside for now. Economic researchers, most recently Moody’s Economy.com, have calculated that expanding the food-stamp program produces more economic stimulus than any other kind of government spending, and much more than any form of tax cuts.  Every additional dollar spent on food stamps translates into $1.73 circulating in the economy.

This page on the U.S. Department of Agriculture’s website contains links to many studies comparing the state participation rates for the Supplemental Nutrition Assistance Program (the official name for the food stamp program). All of the recent annual reports are pdf files you can download.

The report for 2004 put Iowa in 22nd place for food stamp participation and estimated that 61 percent of the 286,000 people eligible for food stamps were receiving them.

The report for 2005 ranked Iowa 24th and estimated that 66 percent of the 307,000 people eligible for food stamps were receiving them.

The report for 2006 ranked Iowa 20th and estimated that 71 percent of the 309,000 people eligible for food stamps were receiving them. Data for 2007 and 2008 are not yet available on the USDA site.

As you can see, Iowa is doing a little better at getting food stamps to the people who qualify for them, but we have a long way to go to match the states near the top. In the top three states, more than 90 percent of people eligible for food stamps are getting them. That figure is above 80 percent for the next five states.

Increasing Iowa’s food stamp enrollment rate from 71 percent to 80 percent would translate to nearly 30,000 more people receiving food stamps in our state. If we could get food stamp participation above 90 percent, roughly 60,000 more Iowans would be receiving food stamps. Those people would consequently have more to spend on other goods and services. Many retailers would benefit as the money flowed through the economy.

I don’t know exactly what needs to be done to further improve Iowa’s food stamp participation rate. There’s a lot of research on the USDA site on factors that affect enrollment. I would welcome comments or a diary from someone with expertise in this area about what Iowa’s doing well already and what we need to do better.

Given the multiplier effect of food stamp benefits on economic activity, this program merits attention from policy-makers looking to stimulate the economy. Government spending on infrastructure projects is worthwhile (as long as we fix what we have first), but let’s not ignore other efficient ways of sparking more economic activity.

To my conservative readers who start hyperventilating at the thought of more people receiving government assistance: don’t think of it as extra food for families struggling to get by. Think of it as a fast way to save jobs in the retail sector–with a lot more bang for the buck than tax cuts.  

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