According to Takepart.com, “Our student loan debt is $1 trillion and climbing. According to a new report, two-thirds of college seniors who graduated last year had student loan debt. The average was $26,600 per borrower. This is the highest average debt among students who graduated with a bachelor’s degree in U.S. history.” In Florida 51% of college graduates had an average debt of $23, 054. For a list of Florida colleges and universities with tuition costs and average debt per student click here.
‘To make things even more difficult, unemployment for recent college grads was at 8.8 percent in 2011,” states Takepart.com.
Takepart.com issue a report, by the Project on Student Debt, showing which states have the largest student loan debt and highest college tuition, both public and private.
We estimate that two-thirds (66%) of college seniors who graduated in 2011 had student loan debt, with an average of $26,600 for those with loans.1 The five percent increase in average debt at the national level is similar to the average annual increase over the past few years. Also similar to previous years, about one-fifth of graduates’ debt is comprised of private loans.
State averages for debt at graduation from four-year colleges ranged widely in 2011, from $17,250 to $32,450. Graduates’ likelihood of having debt, and their average debt load, also varied widely by college.
High-debt states remain concentrated in the Northeast and Midwest, with low-debt states mainly in the West and South. Average debt continues to vary even more at the campus level than at the state level, from $3,000 to $55,250. Colleges with higher costs tend to have higher average debt, but there are many examples of high-cost colleges with low average debt, and vice versa.
Project on Student Debt states, “Recent college graduates have entered an enormously difficult job market, which poses particular challenges for those who need to begin paying back student loans. The unemployment rate for young college graduates in 2011 remained high at 8.8 percent, a slight decrease from 2010, which saw the highest annual rate on record for this group (9.1%). In addition, many more young graduates were considered underemployed. Among those who wanted to be working full time, as many as 19.1 percent were either working part time or had given up looking for work.3 Further, 37.8 percent of working young graduates had jobs that did not require a college degree, depressing their wages.”
To view the average student loan debt by state click here.
00Dr. Rich Swierhttp://drrich.wpengine.com/wp-content/uploads/logo_264x69.pngDr. Rich Swier2012-10-24 05:55:352012-10-24 05:55:35Half of Florida College Grads With Average Student Loan Debt of $23,054
State Budget Solutions has issued its analysis of debt held by each state. Florida is over $65 billion in debt. Florida’s state debt is 20.53% of the total Gross State Product (GSP).
State Budget Solutions finds Florida workers owe $21,709 each in debt to the state with every Floridian owing $7,079. Even with this taxpayer debt load it appears that the State Board of Education (FBOE) wants even more money. The FBOE wants an increase of funds for public education of 4.4% in 2013.
The State Board of Education voted Tuesday [October 9, 2012] to seek a $643 million, or 4.4 percent, spending increase next year for Florida’s public schools and colleges.
The board during their meeting Orlando also approved other legislative requests and a new five-year strategic plan that envisions minority students narrowing – but not fully closing – their achievement gap with white students.
The total $15.6 billion spending request for the budget year beginning July 1, 2013, includes $9.88 billion in basic funding for kindergarten through 12th grade. That would be $322 million, or 3.37 percent, more than is currently being spent. The increase for community and state colleges would be $100.5 million, or 9.43 percent, for a total of $1.17 billion.
The overall 4.4 percent increase equals the state’s estimated growth in general revenue next year.
The Government Accounting Office (GAO) report State and Local Fiscal Condition 2012 notes that growth in local and state government expenditures on education and public welfare are serious problems. Since 1971 state and local expenditures on education are the largest and fastest growing.
The Weekly Standard reports nationally, “The numbers [see above chart] reflect the change in the total number of people employed and the total number of people on the two largest federal welfare programs, as well as Social Security Disability Insurance, between 2008 and 2012,” the minority side of the Senate Budget Committee comments. “The employment figure was derived using the total non-farm and seasonally adjusted number of people employed in December of 2008 (134.4 million) and the number of people employed in September 2012 (133.5 million) as reported by the Bureau of Labor Statistics. The numbers of people on food stamps and Medicaid were derived by comparing the number of program beneficiaries in 2008 (as reported by each agency) and the expected number of program beneficiaries in 2012 (as projected by the Congressional Budget Office).”
00Dr. Rich Swierhttp://drrich.wpengine.com/wp-content/uploads/logo_264x69.pngDr. Rich Swier2012-10-10 11:16:092012-10-10 11:16:09Florida’s Debt Analysis – Time to Erase The Debt?
Congressional Candidate Adam Hasner has taken a new approach to politics. He presents the math. Hasner asks in a recent email,”How many dimes do you have in your pocket right now? Ten cents won’t buy a pack of gum at the grocery store anymore, but at the gas pump, that little silver coin can make a big difference to America’s economy.”
“Did you know every time gas prices go up by just 10 cents, the buying power of American consumers shrinks by $11 billion over the course of a year?, states Hasner.
As the national weekly average for regular gas continues to climb — now $3.59 a gallon, up 7 cents from last week, according to the U.S. Energy Information Administration — here’s how soaring prices are affecting American consumers:
The average American household spends $3,348 of its after tax income on gasoline and diesel.
A 10 cent rise in prices means that the average household spends $93.25 more on gas and diesel per year.
Lower-income households are most sensitive to fluctuations in energy prices. Households in the lowest income quintile spend about 11 percent of their income on energy (which includes gasoline, natural gas and electricity), whereas households in the highest quintile spend 6.8 percent of their income on energy, according to the Bureau of Labor Statistics.
Hasner notes, “For decades, Washington’s energy policies have failed to make real progress toward true energy security. As a result, gas prices are on a perpetual roller-coaster, seemingly breaking record highs on a regular basis.”
Hasner supports an, “All of the above energy approach that relies on innovative, cost-effective renewable energy technologies, new domestic oil and natural gas exploration, safe and reliable nuclear power, and market-driven solutions to keep energy costs affordable for Florida families.”
“Affordable energy costs are critical to getting our economy moving again and bringing jobs back to our country. Now more than ever, we need made-in-America energy solutions to fuel growth and ensure our national security today and for future generations,” states Hasner.
Hasner concludes, “This election isn’t about Republicans or Democrats; this election is about math. And now is the time to tell Washington we expect real energy results, because while 10 cents may not seem like a lot to them, those dimes add up for the rest of us.”
https://drrichswier.com/wp-content/uploads/dime-e1386785922231.jpg380640Dr. Rich Swierhttp://drrich.wpengine.com/wp-content/uploads/logo_264x69.pngDr. Rich Swier2012-10-03 06:23:582013-12-11 13:19:02Hasner Asks: How many dimes do you have in your pocket right now?
Occupy Wall Street’s pathetic first birthday last week confirmed that the longstanding reports of the movement’s death have not, in fact, been exaggerated. So why are we keeping it alive by talking incessantly about income inequality instead of focusing on what really matters — opportunity and upward mobility?
All this huffing and puffing about widening income gaps — coupled with strident calls for wealth redistribution — detracts from the urgent need to shore up our threatened American Dream and develop an opportunity agenda. The nation’s attention should be squarely focused on expanding everyone’s prospects — especially those at the bottom who most need a hand up and a way out.
What matters is not how much more those at the top earn in relation to those at the bottom — they are, after all, not in competition with one another — but rather the real needs of those at the bottom and the opportunities for advancement available to all Americans. And while government “spreading the wealth around” would surely equalize outcomes — the Left’s Dream — it would neither address the real causes of poverty nor expand the real opportunities and earned successes that define the American Dream.
A new Heritage report defends the American Dream from liberalism’s misguided attempts to redefine it along statist and egalitarian lines and explains why income inequality is not an obstacle to advancement in the United States. What really matters — and continues by and large to thrive — is upward mobility.
Rather than focus on those at the top of the ladder we should be concerned about the hurdles that threaten those struggling to achieve the American Dream. “Defending the Dream” draws attention to six factors that most threaten upward mobility:
Statism: The modern administrative state entangles businesses in a suffocating web of regulations and laws. All of this red tape takes a toll on the economy, which in turn leads to fewer jobs being created. And fewer jobs means fewer opportunities for those most in need of jobs.
The Collapse of the Family: The decline of marriage, especially among the poor, has devastating, long-lasting consequences on children and their prospects for success. When it comes to the American Dream, the family is not a tangential social or religious issue; it is a crucial economic one that is deeply intertwined with mobility.
The Dependency Fostered by the Welfare State: Far from eradicating poverty, the welfare state traps people in poverty by discouraging work and undermining the family.
The Erosion of our Culture of Work: By legitimizing indolence and devaluing hard work, our culture decreases the likelihood that the poor, who are most in need of sound cultural indicators, will take advantage of the opportunities America continues to offer.
The Failures of Public Education: Our failing public schools deny countless children the rudimentary skills they need to move ahead in the life.
The Looming Fiscal Crisis: Unless we change course, continued massive government spending and the surging public debt will destroy the foundations of our economy and put the American Dream beyond the reach of our children and grandchildren.
The rise in income inequality in recent decades has in no way contributed to these problems. They grow out of ill-conceived government policies, point to the complete failure of government to address some of our social problems and, in the case of the collapse of the family, are deep-seated cultural problems encouraged and made worse by governmental policies.
The United States must remain what it has always been: the Land of Opportunity. Misguided efforts to use government to transform it instead into the Land of Income Equality will inevitably leave us all worse off. Our first priority must therefore be to refocus the national conversation and our nation’s policies on the promise of upward mobility that is at the heart of the American Dream.
00Dr. Rich Swierhttp://drrich.wpengine.com/wp-content/uploads/logo_264x69.pngDr. Rich Swier2012-09-24 09:32:462012-09-24 09:32:46Heritage Foundation: Six Factors That Threaten The American Dream
Gov. Rick Scott issued the following statement after American Airlines’ announcement that it expects to reduce their Florida workforce by more than 1,000 workers before the end of the year:
“American Airlines’ announcement today is certainly bad news for their company and a setback for hundreds of Florida families. We are focused on growing our economy so every Floridian has access to a great job because we know that having the opportunity to work hard and provide for your children is the heart of the American dream.
“I asked the Department of Economic Opportunity Director Hunting Deutsch to work with the Southwest Florida Workforce Investment Board, the Beacon Council, the Miami Chamber of Commerce and the associated labor unions to immediately develop a plan to transition these highly skilled aviation workers into other jobs. We know that Florida workers want to work, and assisting them in identifying other opportunities in our state is a top priority.”
The Mass Layoff Statistics (MLS)* from the US Department of Labor report that during the period February to July 2012 there have been 470 “Layoff Events” in Florida.
According to the US Department of Labor, Bureau of Labor Statistics Florida has seen a decline in the labor force. In February 2012 there were 9,297,200 in the labor force. In July that number dropped to 9,269,500. Since February 27,700 left the workforce in Florida. During the same period 26,700 jobs were added and the unemployment rate dropped from 9.4 to 8.8 percent. The decline in the workforce may be reflected in the decline in unemployment and skew the number.
On January 1, 2013 Florida is expected to lose over 79,400 defense and defense related jobs due to mandated cut backs in defense spending, known as sequestration. Other jobs are expected to be lost as mandated cuts of $1.2 trillion are implemented. Defense contractors are required by law to send out layoff notifications beginning this month.
*The Mass Layoff Statistics (MLS) program collects reports on mass layoff actions that result in workers being separated from their jobs. Monthly mass layoff numbers are from establishments which have at least 50 initial claims for unemployment insurance (UI) filed against them during a 5-week period. Extended mass layoff numbers (issued quarterly) are from a subset of such establishments—where private sector nonfarm employers indicate that 50 or more workers were separated from their jobs for at least 31 days.
00Dr. Rich Swierhttp://drrich.wpengine.com/wp-content/uploads/logo_264x69.pngDr. Rich Swier2012-09-19 07:02:522012-09-19 07:02:52American Airlines Lays Off Over 1,000 in Florida
According to the Heritage Foundation, “On January 1st, 2013, there will be a $494 billion tax increase on you. This is the highest single-year tax hike in U.S. history. We call it taxmageddon.”
“Taxmageddon is coming from a variety of income tax rates increases, a higher death tax, new taxes from Obamacare, and many more. These tax hikes will primarily hit the middle class, with the dreaded Alternative Minimum Tax being the worst offender. You need to see the details to grasp just how bad it is,” states the Heritage Foundation.
The Heritage Foundation has broken out these federal tax hikes by state, so Floridians may see how bad taxmageddon is for them. According to the analysis Florida will see a total federal tax increase of $34.37 billion. With an average income per tax return of $65,085 that results in an average federal tax increase of $3,669 per tax return.
To view the impact of Taxmageddon on you and your state please click here.
00Dr. Rich Swierhttp://drrich.wpengine.com/wp-content/uploads/logo_264x69.pngDr. Rich Swier2012-09-18 07:23:232012-09-18 07:23:23WARNING: Taxmageddon Coming to Florida on 1/1/2013
The Jacksonville Business Journal reports that Florida stands to lose 79,459 jobs and $4.1 billion in labor income by the end of fiscal 2013 if $1.2 trillion in federal defense cuts take place in January as planned. A report conducted by George Mason University by economist Stephen Fuller says Florida would suffer the sixth most job losses of all the states. The report measures the impact of both defense and nondefense employment reductions at federal agencies and their contractors, as well as at businesses that count them as customers. A little more than half of Florida’s lost jobs in the next fiscal year — 41,905 — would result from Department of Defense cuts, and the rest would stem from reductions at civilian agencies. During that period, Florida would also see gross state product losses of $8 billion. To read more click here. The George Mason University report concludes – The magnitude of economic impacts resulting from the Budget Control Act of 2011 over the combined FY 2012-FY 2013 period have been shown to be large and their impact on the U.S. economy to be significant:
• Combined DOD and non-DOD agency spending reductions totaling $115.7 billion in FY 2013 would reduce the 2013 U.S. GDP by $215.0 billion.
• These spending reductions would result in the loss of 746,222 direct jobs including cutbacks in the federal workforce totaling 277,263 and decreases in the federal contractor workforce totaling 468,959 jobs, thus affecting all sectors of the national economy.
• The loss of these 746,222 direct jobs and 432,978 jobs of suppliers and vendors (indirect jobs) dependent on the prime contractors would reduce total labor income in the U.S. by $109.4 billion.
• The loss of this labor income and the resultant impacts of reduced consumer spending in the economy would generate an additional loss of 958,508 jobs dependent on the spending and re-spending of payroll dollars associated with the direct and indirect jobs lost as a result of BCA.
• This loss of $215.0 billion in GDP and 2.14 million jobs in 2013 would erase two-thirds of the GDP gains projected for the year and raise the national unemployment rate by 1.5 percentage points by the end of 2013.
• These economic impacts would affect every state with their respective vulnerabilities to projected DOD and non-DOD spending reductions being determined by their agency mix and relative magnitudes of federal payroll and procurement. Based on current patterns of federal spending by state, ten states account for more than half of total federal payroll and procurement outlays. This significant concentration of federal spending represents a major threat to these states’ economies in 2013. While other states may appear less vulnerable to federal spending reductions, these may also suffer significant impacts dues to their smaller sizes or more specialized economic structures.
Florida is has twenty-one military installations, and is home to U.S. Central Command at MacDill AFB in Tampa.
00Dr. Rich Swierhttp://drrich.wpengine.com/wp-content/uploads/logo_264x69.pngDr. Rich Swier2012-09-15 10:16:502012-09-15 10:16:50Florida to Lose 79,459 Jobs Due to Defense Cuts
The award is presented to members of Congress who NFIB considers “champions” of small business owners. West received a perfect score of ‘100’ for his votes on 13 key NFIB supported pieces of legislation concerning issues from healthcare, energy and Federal Government regulations.
Rep. West received a perfect score from the National Federation of Independent Businesses as did sixteen other members of the Florida delegation. Republican Senate Candidate Connie Mack received a 100 percent, with Rep. Debbie Wasserman-Schultz garnering a zero. Senator Bill Nelson received a score of 36 and Senator Marco Rubio a score of 100.
Here is the list of the Florida delegation by district and their NFIB scores:
For a complete look at how each Member of the 112th Congress voted, click here
“Our small businesses are at the heart of keeping this economy going and I am proud to receive this award,” West said. “As I travel Dixie Highway in Palm Beach County and visit small businesses in South Florida, I see firsthand the importance of expanding opportunities and reducing burdensome regulations on our independent employers. Our small businesses represent the best of the American spirit and I will continue to be their voice on Capitol Hill.”
NFIB President and CEO Dan Danner praised West for his commitment to American business owners.
“In the 112th Congress, Representative West proved he is willing to stand up and do big things for small business,” Danner said. “Guardian-award winners are genuine small business champions, consistently voting to promote and protect the right of small business owners to own, operate and grow their businesses.”
Congressman Allen West is a member of the House Committee on Small Business and is a member of the Subcommittee on Contracting and Workforce and the Subcommittee on Investigations, Oversight and Regulations.
The Guardian of Small Business Award is presented to lawmakers who vote with small businesses 70 percent or more of the time and demonstrate a commitment to protecting free enterprise.
National Federation of Independent Business is the nation’s leading small business association. Founded in 1943 as a nonprofit, nonpartisan organization, NFIB gives small and independent business owners a voice in shaping the public policy issues that affect their business. NFIB has 350,000 members and its mission is to promote and protect the right of our members to own, operate and grow their businesses.
00Dr. Rich Swierhttp://drrich.wpengine.com/wp-content/uploads/logo_264x69.pngDr. Rich Swier2012-09-13 14:44:492012-09-13 14:44:49Rep. West Receives Guardian of Small Business Award
The continuing collapse of marriage in America, along with a dramatic rise in births to single women, is the most important cause of childhood poverty. In Florida, for example, seven of every 10 poor families with children are headed by a single parent, most of them mothers.
Only 7 percent of married couples with children in Florida were poor in 2009, compared with a third of single-parent families with children (33.4 percent). In Florida, marriage drops the probability of a child’s living in poverty by 78 percent.
Such state numbers on marriage and poverty mirror the national ones. Ignoring the positive impact of marriage on children leads to faulty government policies. It’s tragic, really.
On Sept. 12, the U.S. Census Bureau is set to release its annual poverty report. We’re likely to hear that more than 16 million children in America — about one in five — are poor. Clearly the current recession with its high unemployment pushed up these numbers. But the fact is the child poverty rate was high before the recession and will remain so after it ends.
In 2010, nearly half of all children born in Florida were born outside marriage. Sadly, the women most likely to have children without being married are those with the least ability to support children financially on their own. About 75 percent of births to Florida women who are high school dropouts occur outside marriage. Among women who are college graduates, only 11.5 percent of births are out of wedlock.
America is splitting into two economic castes: In the top, children are raised by married couples with a college education. In the bottom, children are raised by single mothers with a high school diploma or less.
Policymakers at the state and national level, of course, know that education reduces poverty. But they’re largely unaware that marriage is an equally strong anti-poverty weapon. Remarkably, being married is as strong a factor in reducing poverty as graduating from high school. In Florida, married couples with children are 74 percent less likely to be poor than single-parent families with the same level of education.
The nation wisely spends billions of dollars a year to educate low-income children, and billions more for means-tested welfare aid for single mothers. But, despite the massive impact of marriage in reducing poverty, government does little or nothing to discourage births outside marriage — and nothing to encourage healthy marriages.
Many common misconceptions persist. This isn’t about teen pregnancy: Most non-marital births occur to women in their early 20s. Girls under 18 account for only about seven of every 100 births outside marriage. Also, lack of access to birth control isn’t a significant factor.
Some claim unmarried fathers just aren’t “marriageable.” In fact, the overwhelming majority are. These fathers have jobs and, on average, have higher earnings than the mothers. If they remained in the home, child poverty would drop dramatically.
Are low-income single mothers hostile to marriage? No. Research shows most look quite favorably on the institution. They simply don’t see marriage as something that should come before the baby carriage. The result is sustained high levels of child poverty and a host of related social problems.
We need to develop new policies that build on these positive attitudes about marriage. Policymakers and ordinary citizens, looking at these numbers, should demand that government provide facts about the value of marriage to at-risk youth.
For instance, government ought to connect low-income couples with community resources to help them learn, or relearn, skills needed to build and sustain healthy marriages — before they bring children into the world.
It’s also imperative to reform the welfare system to encourage rather than penalize marriage.
Just as government discourages young people from doing drugs or dropping out of school, it should expose the severe shortcomings of the “child first, marriage later” philosophy — especially in low-income communities. Then we will begin to lift millions of children out of poverty.
Mark Mather from the Population Reference Bureau reports, “In the United States, the number ofchildren in single-mother families has risen dramatically over the past four decades, causing considerable concern among policymakers and the public. Researchers have identified the rise in single-parent families (especially mother-child families) as a major factor driving the long-term increase in child poverty in the United States.” To read the full report click here.
00Dr. Rich Swierhttp://drrich.wpengine.com/wp-content/uploads/logo_264x69.pngDr. Rich Swier2012-09-12 09:25:172012-09-12 09:25:17Marriage Reduces Child Poverty in Florida By 78%
This week the Adam Hasner for US House Campaign launches the “It’s About Math” informational series. Between now and Election Day, Adam will be focusing on the real numbers and real issues of great importance to the residents of Florida’s District 22.
“So many people I speak with, regardless of political party, are sick and tired of the name calling and scare tactics,” Adam Hasner said. “What they really want to know is whether or not you have a plan to get America’s fiscal house in order and get our economy moving again. Every day I am talking about just that. I’m hopeful this debate can be about the real differences I have with my opponent on getting spending under control, creating jobs and improving the lives of people in our community. Solving our nation’s problems isn’t about Republicans or Democrats or any political philosophy. It’s about math.”
A key number from the August jobs report released last week was 368,000. That is the number of Americans who stopped looking for work and are no longer counted in the US labor force by the United States Labor Department. (Wall Street Journal, Five Key Takeaways from Jobs Report, 9/7/12).
“This number itself is telling, but it also says more about the individual stories of the college student who can’t find a job, a dad who got laid off, a mom who’s working less hours than she wants to or needs to, a senior who’s had to go back to work to make ends meet because they lost their retirement savings,” said Hasner.
“Behind this number are the stories of the people who are losing hope and beginning to believe that our country’s best days are behind us. It’s distressing that people are giving up. We can do better and they deserve better.
“While the official unemployment rate hovers above 8% for the 43rd consecutive month – perpetuating the slowest economic recovery in decades – Lois Frankel continues to distract attention from spending and the economy and remains silent about what should we do to create jobs.
“That’s most likely because she knows her record on job creation as Mayor was abysmal. Lois Frankel entered office in West Palm Beach with the city’s unemployment rate at 5.4%. But by the time she left office 8 years later, the unemployment rate in her city had climbed to 10.6%. The numbers prove that she didn’t have solutions for West Palm Beach and she’s failed to offer any ideas on how to get our nation’s economy back on track.
“Mayor Frankel continues to support the same misguided Washington policies that for the last 43 months have been failing small businesses, families and hard-working Americans.
“Both parties got us into this mess, but now isn’t the time to point fingers and place blame. It’s time for a new approach:
We must reform the current tax code to make it flatter, fairer, and simpler and eliminate loopholes and exemptions.
We must eliminate hurdles to form new businesses and right-size regulations that are currently stifling economic growth with red tape and compliance costs and do it with a balanced approach that protects our natural resources and protects consumers.
We must unleash the power of Made in America energy with new technologies for safe development of domestic oil and natural gas. Affordable energy is a key factor in creating jobs and attracting companies to bring manufacturing jobs back home.
We must also focus on education and worker training initiatives to get the long term unemployed back to work.
“What small businesses need is certainty, knowing what to expect so they can make critical decisions to hire new employees, invest in new equipment, and expand their operations.
“It’s time for common-sense policies that will empower private sector job creation to help Main Street get back on its feet and get America’s economy back on the move.
00Dr. Rich Swierhttp://drrich.wpengine.com/wp-content/uploads/logo_264x69.pngDr. Rich Swier2012-09-10 13:48:382012-09-10 13:48:38Hasner Campaign: Both Parties Created This Jobs Crisis
Jobs are top of mind during the 2012 election cycle. Elected officials from President Obama on down are touting their pro-economic growth records and job creation skills. Sarasota County is no exception. It is appropriate to review their on going efforts to “create jobs” in Sarasota County, FL.
In April 2009 Sarasota County released its Five-Year Economic Development Strategic Plan. The Five-Year Plan states, “Community and business leaders have made it clear that a shotgun approach will no longer work. This proposed plan is based on five guiding principles: Promote the growth/health of existing businesses; Create an environment that promotes homegrown businesses and innovation; Diversify the economy through platforms that build on our unique assets; Make strategic plays in emerging markets; Leverage resources and investments to grow capacity to pursue economic opportunities.”
The plan may be characterized as the County Commission’s “jobs bill”. The strategic plan, now in its third year, recognized that the recession had hit Sarasota.
Based upon the strategic plan, the Sarasota Board of County Commissioners on September 15, 2010 passed Resolution 2010-199. It created a goal to “promote economic activity in the County by providing economic incentives that will encourage diverse new businesses to relocate to Sarasota County and current businesses to expand.” One of the things created was an “economic development fund” and an incentives or awards program. One of the purposes is to attract new or help expanding companies that “provide an above-average wage to its employees”.
The resolution goes into great detail to lay out a series of “Economic Development Factors” that “shall be applied when the Board makes its determination on ad valorem tax exemptions to a requesting business”. But what about guidelines for the “economic development fund”? This question is germane as the fund has already given out $4,482,303 with an additional $5,527,797 in awards remaining to be paid. The $10 million for this “fund” came from the sale of foreclosed properties and collection of unpaid County property taxes. Click here to view the 2012 Economic Development report to the County (slides 65-68).
Jeff Maultsby, Manager of Business and Economic Development, Steve Botelho and Lisa Damschroder from the Office of Financial Planning and Joan McGill, Vice President of Business Development at the Economic Development Corporation, said there is no system in place to select the best candidates to meet the goals established by the County Commission. As of now there is no way to accurately determine any return on investment to the County from these awards (staff indicated the purchase of a software program may to help address this).
Here is an analysis of the County economic development efforts to date:
Of the $4.48 million awarded, PGT received $600,00 and Tervis Tumbler $450,00 (two awards) given since 2010, for a combined total payout of $1,050,000 (23% of all awards to date). These two companies actually added the following: PGT – 432 jobs, Tervis Tumbler – 413 jobs. PGT and Tervis Tumbler added 845 or 80.6% of 1,048 jobs created to date under this awards program.
This would seem like a big win for the County until one drills down a little deeper.
As Resolution 2010-199 states the County Commission wants to attract and expand businesses with an “above-average wage”. The average wage for all industries in Sarasota County according to the Florida Office of Economic and Demographic Research is $38,660.
According to County staff the actual average wages are: PGT $24,335 (initially projected average wage of $29,500), Tervis Tumbler $26,572 (initially projected average wage of $31,500). Both companies fell well short of the existing County average wage of $38,660: PGT 38% lower and Tervis Tumbler 31% lower. If the County wanted above-average wages they did not get them with these two companies. Even the “projected average wages” for each company were below the County average wage.
If the goal is above-average wages then why give money to any company projecting below-average wages?
Would these jobs have been created without the County awards? According to PGT President Rodney Hershberger the company was planning to close its plant in North Carolina in the 2006-2007 time frame due to the housing slump. The greatest concern was a lack of land and buildings. In the middle of 2010 PGT began looking at options to move the equipment and employees to Florida, with Sarasota, Jacksonville and Miami as possible sites. PGT primarily serves customers in Florida with impact (hurricane) windows and the North Carolina plant was half impact and half non-impact windows. The plant would be closed and operations moved closer to its Florida market. The intent was to move employees to Florida. However, due to deep family roots at the NC plant only 30 employees actually relocated to Sarasota County. Sarasota was always the top choice because this is where PGT was founded and its the central home location, which best serves its impact windows market. Rodney said of the newly hired employees about 70% live in Sarasota, 10% in Manatee County and 20% in Charlotte County. According to Tim Graham, VP of Human Resources for Tervis Tumbler, “Through the assistance provided to Tervis by the EDC grant we were able to substantially increase our production capacity and employment at Tervis.” PGT used its award to off set the cost of moving equipment. Tervis used its two awards to off set impact fees.
Why did Sarasota County taxpayers invest over $1 million in two well established local companies?
Let’s take a look at the remaining 203 jobs “created” to date. Forty-one had an average wage below the County average. The remaining 162 jobs had an average wage of $52,496 or 36% higher than the County average. This average wage increase was offset by the 886 below-average wage jobs.
There remain award commitments of over $5.5 million for the creation of a “projected” 1260 jobs. Will these create more above-average wage jobs? According to the County spreadsheet the companies yet to produce jobs have a “projected average wage” of $50,232. The “actual average wage” of jobs created by these companies to date is $43,368 or 14% lower than the currently projected wages. Another issue is most of the money given to date was given up front before any jobs were created. The current contracts give companies anywhere from 1 to 6 years to actually create the jobs. It should be noted that only recently do the contracts with the County state that the awards will not be made until after the jobs are created. I believed they learned a harsh lesson from $650,000 awarded to Sandborn Studios on September 2, 2010 with no jobs created to date.
Finally, there are nine awards listed on the Economic Development Incentives spreadsheet to either other governments (e.g. City of North Port Economic Development Study, City of Sarasota Newtown Business Assistance Program) or non-profit agencies (e.g. SCOPE – Institute for the Ages, Rev 3 Triathlon). How does a triathlon attract companies offering above-average jobs you may ask? The monies allocated to these governmental and non-profit entities total $3.84 million or 70% of all remaining awards. This allocation of funding is interesting for two reasons 1) there is no system to measure jobs created by inter-governmental transfers and 2) there is already in place a competitive system to allocate funds to non-profit organizations run by the same office that runs this business incentive awards program. This system has been totally bypassed using these “business” awards to non-profits. The awards may violate the intent if not the verbiage of the County Resolution 2010-199 “to relocate and expand existing businesses”. I did not know the County wanted more non-profits who don’t pay taxes to the County!
The Sarasota County Commission took money owed to taxpayers and redistributed it to a stimulus program that: lacked strict/measurable criteria for awarding the money, created jobs that by enlarge offer below-average wages and has no accurate way to measure any return on the taxpayers investment to the County.
The Sarasota County Commission on Tuesday, June 26, 2012 voted unanimously to repeal and replace Resoluton 2010-199 related to economic incentives provided for businesses that relocate to the county.
David E. Merrill, Sarasota business owner and former Mayor of the City of Sarasota, in a September 8, 2012 email to the County Commissioners stated, “So that you don’t look as foolish as Charlie Christ and the city and county commissioners in St. Lucie, I urge you to stop giving ‘corporate welfare’ checks to companies in the name of economic development, and, instead, focus on building a really great community through wise urban design and a focus on aesthetics and quality-of-life issues. Let the bankers and investors fund private businesses, not our governments.”
Government does not create jobs, profits do. The more products produced the more profit generated. As demand rises, profits rise and more workers are needed to provide the product or service offered. Without profit there can be no job growth. Government must take profits from one company and redistribute it to another to meet government’s goals.
00Dr. Rich Swierhttp://drrich.wpengine.com/wp-content/uploads/logo_264x69.pngDr. Rich Swier2012-09-09 05:43:312012-09-09 05:43:31Sarasota County’s 2009 Jobs Plan – An Analysis
As President Obama prepares to take the stage tonight and accept his party’s nomination for re-election there is an ongoing discussion about the state of the economy. The great question is: Are we as a nation better off today than four years ago?
Media Matters states, “In their attempts to grapple with the question of whether Americans are better off, cable news outlets have regularly failed to provide important context about the dire state of the economy in late 2008, when millions of jobs were lost.” Investors Business Daily reports, “Obama’s argument is simple: The economy was headed for a second Great Depression when he took office — hemorrhaging GDP and jobs. His stimulus, the auto bailouts and so on, prevented that, and the economy has since been slowly digging out of the massive ditch into which President Bush drove it. Thus, Obama says, he deserves an ‘incomplete’ grade.”
Media Matters focuses on statements from five economists reflecting upon September 2008 and the financial crisis. Diana Henriques, who covered finance for The New York Times, states, “September 2008 was one of the scariest months I have ever experienced as a business reporter. We had seen Bear Stearns nearly fail, we had seen Fannie Mae and Freddie Mac taken under receivership.”
IBD takes a comparative approach, looking at key indicators then and now. IBD uses the following examples to answer the question:
• Median incomes: These have fallen 7.3% since Obama took office, which translates into an average of $4,000. Since the so-called recovery started, median incomes continued to fall, dropping $2,544, or 4.8%.
• Long-term unemployed: More than three years into Obama’s recovery, 811,000 more still fall into this category than when the recession ended.
• Poverty: The poverty rate climbed to 15.1% in 2010, up from 14.3% in 2009, and economists think it may have hit 15.7% last year, highest since the 1960s.
• Food stamps: There are 11.8 million more people on food stamps since Obama’s recovery started.
• Disability: More than 1 million workers have been added to Social Security’s disability program in the last three years.
• Gas prices: A gallon of gas cost $1.89 when Obama was sworn in. By June 2009, the price was $2.70. Today, it’s $3.84.
• Misery Index: When Obama took office, the combination of unemployment and inflation stood at 7.83. Today it’s 9.71.
• Union membership: Even unions are worse off under Obama, with membership dropping half a million between 2009 and 2011.
• Debt: Everyone is far worse off if you just look at the national debt. It has climbed more than $5 trillion under Obama, crossing $16 trillion for the first time on Tuesday and driving the U.S. credit rating down.
Media Matters states, “Other veteran financial scribes point to the overall economic picture today as compared to 2008, while also noting that the positive direction of the economy is important, too. Their comments are supported by a number of key indicators: The economy has grown for twelve consecutive quarters; private sector employment has grown for 29 consecutive months, adding millions of jobs; and the Dow Jones Industrial Average has nearly doubled from its low point in March 2009.”
Media Matters quotes Kevin Hall, McClatchy’s national economics correspondent, as saying, “If you go back and look at the charts — you can pull up the GDP chart, we are growing 2 to 2.2 percent — you would say it is clearly yes, compared to a 3.7 percent contraction in the third quarter of 2008, followed by an 8.9 percent contraction in the fourth quarter of 2008.”
The real indicator of if we are doing better will not be determined by economists or statistics. It will be determined at kitchen tables across America. What each family, individual and business owner feels and experiences will determine the truth about are we better off. This will translate into motivation to vote for or against a particular candidate.
Bottom line: Are YOU better off today than 4 years ago?
Unemployment is at 8.3 percent. The economy is sputtering at 1.5 percent growth. Food prices are rising due to drought conditions across the country. And gas prices are up again, pinching Americans’ summer budgets. It is past time for the President and Congress to pursue smart policies that would put us on a path to relief.
According to AAA’s Fuel Gauge Report, the current national average for regular is $3.66 per gallon. That’s up 28 cents per gallon from a month ago, and July had its biggest price jump since AAA started tracking prices in 2000. To see the average for Florida click here.
There are many factors affecting prices that we cannot control—worldwide tensions, especially in the Middle East, can drive up oil prices. Global demand, especially from China and India’s rapidly growing economies, continues upward.
But after three years of adding regulatory hurdles and blocking exploratory access and development, President Obama’s policies are helping keep prices higher than necessary.
If the President truly wanted to lower gas prices, he would work to increase supply. But when given the opportunity, he has done the opposite. He turned down the Keystone XL pipeline, which would bring up to 830,000 barrels of oil per day from Canada. His Administration has made it even harder for companies to explore and extract domestic energy resources by canceling, delaying, or withdrawing a number of lease sales for exploration and development. Meanwhile, huge swaths of federal lands have been put off limits for energy exploration.
Domestic refinery outages have had a recent impact on gas prices. Two of the factors holding back domestic energy production are regulatory red tape and litigation—and these, we can do something about. As Heritage’s Nicolas Loris notes:
Environmental activists delay new energy projects by filing endless administrative appeals and lawsuits. Creating a manageable time frame for permitting and for groups or individuals to contest energy plans would keep potentially cost-effective ventures from being tied up for years in litigation while allowing the public and interested parties to voice opposition or support for these projects.
We don’t have to stand still. Congress could alleviate the energy crunch in 10 different ways by taking action on things we can control, like restrictions on oil shale development and offshore drilling.
One of the most common objections is that increasing domestic oil production takes too long and would not impact the market for at least a decade. The longer people make this argument, however, the longer it will take. The sooner we make investments in domestic energy, the sooner those benefits will be realized. And with some serious reforms, some of this oil can reach the market in much less than a decade.
Gas prices aren’t under the control of any one President. But Americans shouldn’t settle for policies that restrict oil exploration, refining, and production and artificially drive prices higher.
Recently in a radio interview Robert Wiedemer co-author of America’s Bubble Economy and Aftershock and Edward J. Pinto, resident scholar at the American Enterprise Institute discussed the idea of the United States having a “bubble government”. Wiedemer stated that America has suffered through “a number of financial bubbles” and the “aftershock following each”. To date each of these bubbles, the most recent being the housing bubble, have burst and fallen onto two other looming bubbles. These two bubbles are the “dollar bubble” and the “debt bubble”.
These two bubbles are primed to burst and the pin is called inflation.
The Wall Street Journal headline for April 5, 2012 was “Markets Fear End of Stimulus” written by Jonathan Cheng and Charles Forelle. What is the great concern? According to Cheng and Forelle, “European Central Bank President Mario Draghi indicated he would be hesitant to undertake more monetary easing, citing concerns about inflation.” Monetary easing (a.k.a. government stimulus or quantitative easing) is governments printing money. Today American is awash in money due to our government printing it with no end in sight – the dollar bubble is upon us.
Congress has failed in their Constitutional duty to pass a budget in nearly four years. The U.S. government runs on continuing resolutions and Congress has raised the debt ceiling to an astounding $15+ trillion dollars. In 2011 Congress spent nearly 55% more than it collect in revenues. The debt ceiling will be breached yet again before the November 6, 2012 elections. This all has caused our government to borrow at an unprecedented rate of 40 cents of every dollar – the debt bubble.
What does that all have to do with Florida?
Florida is especially vulnerable to the aftershock of either a dollar or debt bubble burst. Florida’s barely recovering housing market and our large population of fixed income retirees are in the cross hairs should inflation increase even fractionally.
According to Edward J. Pinto, “One in four [Federal Housing Administration] FHA loans outstanding in Georgia and New Jersey are now thirty-days-plus delinquent, with eight additional states having delinquency rates above 20 percent. The national rate is 17.79 percent.” Florida has a delinquency rate of 23.07%. Pinto points out, “FHA is estimated to have a current net worth of -$16.923 billion, approximately $18 billion less than the ‘economic net worth’ set forth in FHA’s 2011 Actuarial Study.”
Pinto states, “The Government Mortgage Complex (GMC), consisting of FHA, Fannie Mae, Freddie Mac, the Veterans Administration and Federal Department of Agriculture, is bankrupt. The Government Mortgage Complex guarantees about $6 trillion in in home mortgages, yet has zero capital backing it. Fannie and Freddie do owe the government nearly $200 billion and counting.”
When inflation kicks in, as it is in Europe, the bond markets will tank, as they have in Spain, and Florida will be facing a double dip recession because many retirees have invested in bonds.
President Obama, the Federal Reserve and Congress will do everything they can to not let this collapse happen before the November 2012 elections. However, they may not be able to stop it, as the markets are already reacting to failed attempts at austerity in the EU and the rising cost of debt.
These two bubbles are coming home to roost in America.
When they burst the burden will fall most heavily upon the American taxpayer a rapidly diminishing species. There is not the political will to address either bubble until they burst and a national crisis occurs. As the argument goes “never let a good crisis go to waste” but this time the austerity solutions will be Draconian.
A possible scenario is a replay of the October surprise of 2008 – a meltdown of the financial markets. Are we being set up for another TARP or Stimulus III? Time will tell.
00Dr. Rich Swierhttp://drrich.wpengine.com/wp-content/uploads/logo_264x69.pngDr. Rich Swier2012-07-29 18:08:152012-07-29 18:08:15Watch Out Florida Here Comes Our “Bubble Government”
Gallup Politics recently did an Environmental poll (see the below chart). The results shows that a majority of Republicans and super majority of Democrats favor actions that will lead to higher food, fuel and energy prices. While there are more Republicans that favor opening public lands to exploration and drilling the end results of their support for policies like increasing regulations to reduce “emissions and pollution standards for businesses” means higher costs for all consumers.
Americans polled may not understand the difference between “emissions” and “pollution”.
Emissions/greenhouse gasses, e.g. CO2, primarily occur due to water evaporation from the earth’s oceans and seas. When 50% of Republicans want government to “impose mandatory controls on carbon dioxide emissions” many consumers wonder if they understand that we cannot control water evaporation from happening. The EPA recently issued a CO2 emissions ruling that impacts all of U.S. coal fired plants and will cause many to shut down because they cannot meet the new standards. This will drive up energy costs and thereby food costs.
Government spending on solar and wind power has been a disaster with many of the companies failing to produce a cost effective product, moving their operations to China or going bankrupt. All of these companies are a further drain on our economy because they are not producing cheap and reliable power, they are producing just the opposite, which drives up energy costs and thereby food costs.
While Republicans generally favor opening public lands to oil, natural gas and oil shale exploration and production, nearly half want stronger enforcement of environmental regulations and higher emission standards for automobiles. One negates the other.
The environmentalists are licking their lips at these numbers.
Gallup has tracked seven of the eight proposals periodically since 2001. Support for all but nuclear energy has declined since last measured in 2007, with the largest drops seen for spending government money to develop alternative sources of fuel for automobiles, strengthening enforcement of environmental regulations, and setting higher auto emissions standards.
These declines could be due to Americans’ reduced priority in the last several years for preserving the environment at the expense of economic growth, an outgrowth of the economic downturn. However, they are also likely to stem from heightened public concern about government spending and regulations specifically, particularly among Republicans.
Some do not find these numbers low enough to keep Republicans, in an election year, from stopping the power grab by the EPA. If this is a campaign issue then the consumer loses. As food, fuel and energy prices rise so will inflation. The column “Our Bubble Government” notes that inflation will burst both the dollar and debt bubbles. The higher the cost of goods and borrowing the more likely the current recession will last or deepen.
From this Gallup Environment poll some see trouble brewing on the horizon and its name is – inflation.
Zunaira Zaki from 
