The South's Talent-Development Problem

Besides making the region unwelcoming to gays and minorities, the "godly folk" in the Bible Belt/American South also hate paying taxes and spending money on public education. It's part of the reason region lags behind other parts of America in talent development and upward social mobility.  A piece in The Economist - once again leave it to the European media to provide such good coverage - looks at the penny wise pound foolishness of the states in the South where among far too many embracing ignorance and bigotry are celebrated.  Here are some article excerpts:

[G]etting a good job in the South is tough if you’re young. A new report from MDC, a non-profit based in Durham, says that more than 30% of those under 25 in Arkansas, Georgia, Kentucky, Mississippi and North Carolina are “underemployed”: they are either looking for a job, settling for part-time work or giving up on the search entirely.

Why are young people having such a tough time in the labour market? Part of the problem is competition. Many Southern cities, with their low cost of living, cheap property prices and good weather, attract graduates from across America, and there aren’t enough jobs to employ them all.

Newcomers clash over the available jobs, and residents with inferior credentials are easily displaced. Those who fail to become knowledge workers often end up shunted into the growing service sector, doing the kind of jobs (serve coffee, fix up houses) that techie types are too busy to do for themselves. “Talent recruitment is not balanced against talent development in the South,” says David Dodson, president of MDC. “It’s almost like a colonial economy, because the benefits accrue to those that come from someplace else.”

The South certainly has a talent-development problem. Poor education standards are a big part of it. The numbers bear this out. In an average group of 100 14-15 year-old Americans, 27 of them will not finish high school on time, according to the MDC study; this number goes up to 40 in South Carolina, 39 in Mississippi and 37 in Georgia. The problem is made worse by recent drops in education funding. Between fiscal years 2008 and 2014 state spending per pupil, adjusted for inflation, decreased in Alabama by $1,242—more than anywhere else in America. In Georgia it dropped by $707 and in Mississippi by $648. In fact, such spending declined in every Southern state apart from Tennessee. During this time spending actually increased in 12 other non-Southern states.

So it is unsurprising that Southern cities are among the worst in the nation when it comes to social mobility and inequality. . . . A study by the Equality of Opportunity Project last year says a child born into an Atlanta family with income in the bottom fifth percentile has just a 4.5% chance of making it to the top percentile; in San Francisco the chance is 12.2%. 

All of this makes life tough for young people in the South. Even for college graduates, finding good jobs is no piece of cake.

Living in the past and thumping on one's Bible constantly does little to prepare one's children and grandchildren for the future.

Social Mobility Is Lowest in the South/Bible Belt

Click image to enlarge

I often mark the argument that backwardness and bigotry are impediments to economic progress.  A new study reported on by the New York Times would seem to corroborate this premise in significant part.  Where is social mobility the lowest?  In the South and Bible Belt, of course.  Where is it higher?  Except for some surprising exceptions in the sparsely settled mid-west, in the Northeast and in the far west.  In short, progressive areas where racism and homophobia are less prevalent provide a better opportunity for those born into the bottom economic classes of society to move up.  In Virginia, the highest social mobility is not surprisingly found in Northern Virginia.  The lowest social mobility is found across Virginia's largely reactionary south side - and area where the "godly Christians" hold sway.  As for Hampton Roads, it does not fare too well either, something that ought to send a warning bell to area leaders.  Here are article highlights:

The study — based on millions of anonymous earnings records and being released this week by a team of top academic economists — is the first with enough data to compare upward mobility across metropolitan areas. These comparisons provide some of the most powerful evidence so far about the factors that seem to drive people’s chances of rising beyond the station of their birth, including education, family structure and the economic layout of metropolitan areas. 

Climbing the income ladder occurs less often in the Southeast and industrial Midwest, the data shows, with the odds notably low in Atlanta, Charlotte, Memphis, Raleigh, Indianapolis, Cincinnati and Columbus. By contrast, some of the highest rates occur in the Northeast, Great Plains and West, including in New York, Boston, Salt Lake City, Pittsburgh, Seattle and large swaths of California and Minnesota. 

“Where you grow up matters,” said Nathaniel Hendren, a Harvard economist and one of the study’s authors. “There is tremendous variation across the U.S. in the extent to which kids can rise out of poverty.” 

That variation does not stem simply from the fact that some areas have higher average incomes: upward mobility rates, Mr. Hendren added, often differ sharply in areas where average income is similar, like Atlanta and Seattle. 

The gaps can be stark. On average, fairly poor children in Seattle — those who grew up in the 25th percentile of the national income distribution — do as well financially when they grow up as middle-class children — those who grew up at the 50th percentile — from Atlanta. 

[T]he researchers identified four broad factors that appeared to affect income mobility, including the size and dispersion of the local middle class. All else being equal, upward mobility tended to be higher in metropolitan areas where poor families were more dispersed among mixed-income neighborhoods.

Income mobility was also higher in areas with more two-parent households, better elementary schools and high schools, and more civic engagement, including membership in religious and community groups. 

Regions with larger black populations had lower upward-mobility rates. But the researchers’ analysis suggested that this was not primarily because of their race. Both white and black residents of Atlanta have low upward mobility, for instance. 

In previous studies of mobility, economists have found that a smaller percentage of people escape childhood poverty in the United States than in several other rich countries, including Canada, Australia, France, Germany and Japan. The latest study is consistent with those findings. 

That pattern makes economists more confident that the characteristics of different regions — as opposed to something inherent and unchangeable in the local residents — are helping cause the varying mobility rates. 

GOP/Conservative Groups Plan US-wide Assault on Education, Health and Public Sector

David Koch

The hypocrisy of Republicans and self-professed Bible worshiping conservatives continues to soar to new levels.  As The Guardian reports, plans are underway for a 34 state campaign to "release residents from government dependency," which of course, really means that the poor and those without health care will be cast into the gutter to hopefully die while education spending is gutted.  Helping to fund this effort to bring back the worse aspects of the Gilded Age are not surprisingly the greed driven billionaire Koch brothers.   Shockingly, another major supporter is food giant Kraft and multinational drugs company GlaxoSmithKline (yes, the boyfriend and I will be changing our shopping patterns).  The article also highlights the pressing need to halt the political activities of alleged charities that are nothing more than funding funnels Here are story highlights:for the far right. 

Conservative groups across the US are planning a co-ordinated assault against public sector rights and services in the key areas of education, healthcare, income tax, workers' compensation and the environment, documents obtained by the Guardian reveal.

The strategy for the state-level organisations, which describe themselves as "free-market thinktanks", includes proposals from six different states for cuts in public sector pensions, campaigns to reduce the wages of government workers and eliminate income taxes, school voucher schemes to counter public education, opposition to Medicaid, and a campaign against regional efforts to combat greenhouse gas emissions that cause climate change.

The policy goals are contained in a set of funding proposals obtained by the Guardian. . . . The documents contain 40 funding proposals from 34 states, providing a blueprint for the conservative agenda in 2014.

In partnership with the Texas Observer and the Portland Press Herald in Maine, the Guardian is publishing SPN's summary of all the proposals to give readers and news outlets full and fair access to state-by-state conservative plans that could have significant impact throughout the US, and to allow the public to reach its own conclusions about whether these activities comply with the spirit of non-profit tax-exempt charities.Details of the co-ordinated approach come amid growing federal scrutiny of the political activities of tax-exempt charities.

Most of the "thinktanks" involved in the proposals gathered by the State Policy Network are constituted as 501(c)(3) charities that are exempt from tax by the Internal Revenue Service. Though the groups are not involved in election campaigns, they are subject to strict restrictions on the amount of lobbying they are allowed to perform. Several of the grant bids contained in the Guardian documents propose the launch of "media campaigns" aimed at changing state laws and policies, or refer to "advancing model legislation" and "candidate briefings", in ways that arguably cross the line into lobbying.

The documents also cast light on the nexus of funding arrangements behind radical rightwing campaigns. The State Policy Network (SPN) has members in each of the 50 states and an annual warchest of $83m drawn from major corporate donors that include the energy tycoons the Koch brothers, the tobacco company Philip Morris, food giant Kraft and the multinational drugs company GlaxoSmithKline.

The proposals in the grant bids contained in the Guardian documents go beyond a commitment to free enterprise, however. They include:

• "reforms" to public employee pensions raised by SPN thinktanks in Arizona, Colorado, Minnesota, Missouri, New Jersey and Pennsylvania;
• tax elimination or reduction schemes in Alabama, Arkansas, Georgia, Maryland, Nebraska and New York;
• an education voucher system to promote private and home schooling in Florida;
• campaigns against worker and union rights in Delaware and Nevada;
• opposition to Medicaid in Georgia, North Carolina and Utah.

Medicaid is the target of a grant proposal coming from the Texas Public Policy Foundation (TPPF), an influential thinktank funded largely by rightwing foundations and corporations including the energy tycoons the Koch brothers, tobacco company Altria and the telecoms giant Verizon. The Texas Observer has investigated the contents of the document and points out that in its request for $40,000 from Searle, TPPF claims credit for blocking Medicaid expansion in the state.

The article is lengthy, so read the entire piece.

Bleak Friday - And Year - For Many Virginians

One hears Republicans at the state and federal level blathering disingenuously about wanting to create jobs and promote economic growth, yet in their quest to never raise taxes - and preferable give tax breaks to the wealthy - they enact budgets that ultimately have the exact opposite of the goals they pretend to support.  And as The Commonwealth Institute reports, past decisions and GOP backed budgets when fully analyzed present a less than rosy picture for Virginia.  Here are some excerpts:

Official state estimates predict the amount of money it takes in to pay for education, health care and other services will increase moderately over the next few years as personal income ticks up.

But a closer look at the numbers, adjusting revenue projections to account for one-time revenue bumps and reduced federal spending, changes that picture and puts Virginia back into shortfall territory, without enough revenue to meet the routine needs of Virginians.

Official state revenue forecasts may have Virginia with $700 million more than it needs to meet its technical budget obligations for Fiscal Year 2014-2016. Or, the sluggish economy and past decisions made to balance the budget may have the state facing a cumulative shortfall of over $300 million by the end of Fiscal Year 2016.

Key factors influencing the 2014-2016 budget:

• Recent revenue windfall masks problems.
  • In 2013, Virginia got a one-time, $290 million windfall from non-withholding tax payments – almost three-times more than expected.
  • That windfall helped balance the budget, but masked revenue shortfalls in other areas, including sales, corporate and individual income tax withholdings.
  • Without the bump in non-withholding, Virginia would have missed its FY 2013 revenue forecast
  • Backing out the one-time revenue boost from the formula used to calculate future revenue growth has Virginia facing a shortfall of about $300 million by the end of FY 2016.

• Sequestration, sluggish economy starting to hit state.
  • Recent employment gains in the state have been below expectations and well below typical recovery patterns.
  • Virginia’s individual income tax withholdings and sales tax revenue slowed in the spring and summer of 2013.
  • The federal government accounts for 1 out of every 12 jobs in Virginia. Nationally, that figure is 1 out of every 27 jobs.
  • With two wars winding down and federal lawmakers aiming to reduce the national debt and deficit, it’s likely that military spending will decrease regardless of the details of sequestration.

• Years of cuts have starved vital services while costs remain.
  • State spending in key areas is now below pre-recession levels, even before considering inflation cost increases or cost increases driven by population growth.
  • Support for public education is down by $479 million, or 8.5 percent compared to pre-recession levels. Yet enrollment is up 3.6 percent.
  • General fund support for the state’s colleges and universities is down $140 million – 8.4 percent – but enrollment is up 24 percent.

• Bills to be paid.  During the recession, the state nearly depleted its rainy day fund. Replenishing that fund at its new increased level will take years and is also a legal obligation that reduces budget flexibility and the amount available to invest in key priorities.

 Other disturbing findings have been released in respect to Virginia's wage levels that are troubling:

In 2012, hourly wages for workers at every wage level were below their historical peaks. In other words, when you adjust for inflation, low, middle, and high earners alike earned less per hour in 2012 than they had at some point in the past decade or so.
What varies, however, is how far wages have fallen and for how long.
Wages for all workers  in Virginia peaked somewhere between 2001 and 2010. For lower earners, those peaks occurred longer ago than for higher earners, whose wages peaked much more recently. That means lower wage workers were taking hits not just during the recession, but well before it began, while high wage workers saw their wages rise, even during the recession.
- See more at: http://thehalfsheet.org/post/68170755977/in-the-dark#sthash.yFu71OWG.dpuf

In 2012, hourly wages for workers at every wage level were below their historical peaks. In other words, when you adjust for inflation, low, middle, and high earners alike earned less per hour in 2012 than they had at some point in the past decade or so.

What varies, however, is how far wages have fallen and for how long. Wages for all workers  in Virginia peaked somewhere between 2001 and 2010. For lower earners, those peaks occurred longer ago than for higher earners, whose wages peaked much more recently. That means lower wage workers were taking hits not just during the recession, but well before it began, while high wage workers saw their wages rise, even during the recession.

As a result, lower-wage workers are now even worse off relative to their higher-wage counterparts. For example, the bottom 10 percent of earners – who make up to $8.18 an hour – had wages in 2012 that were more than 10 percent below their 2004 peak. But the top 10 percent of earners – who make more than $47.97 an hour – were only 2 percent down from their peak, which they just hit in 2010. 

It goes without saying that the GOP nationally and in Virginia opposes increasing the minimum wage even though  most of the increase in wages would be immediately re-injected into the economy.  As for Medicaid Expansion, which the Virginia GOP likewise opposes, the Commonwealth Instutite found that it would pay for itself, expand the number of Virginian's with health care access, and create jobs:

Virginia has many options to ensure that expanding Medicaid can pay for itself and provide coverage to nearly 400,000 uninsured Virginians. That’s because Virginia currently funds a wide range of services for the uninsured with state general fund dollars. To the extent that Medicaid would begin paying for some of those services with federal dollars, it would both reduce state costs and provide funding for unmet health needs in Virginia.

While expansion is forecast to cost the state $1.60 billion from 2014 to 2022 – with most of that cost coming in the later years – the $1.64 billion in savings from expansion would offset all of the costs and ease state budget pressures.

Over the next nine years (2014-2022), savings would come from six key sources:

• $637 million from reducing indigent care funding by 50 percent.

• $292 million from insuring patients treated through Community Service Boards for mental health and substance abuse issues.

• $290 million from covering the inpatient hospital care for state prisoners.

• $173 million from slowing growth in premium increases for the state employee health insurance plan.

• $142 million from capturing savings from other provisions of the Affordable Care Act.

• $104 million from replacing general funds with federal funds used to support programs for low-income people who currently do not qualify for Medicaid.

 Given that its policies are wrong for most Virginians, how does the Virginia GOP manage to cling to power?  It plays on the racism, religious extremism and overall bigotry of the party base and induce the ignorant and short sighted to vote against their own long term best interest.  One has to wonder when the Hell these folks are going to open their eyes.

The GOP Fueled Driven Decline of North Carolina

The southern boundary of the Hampton Roads area is the North Carolina/Virginia border.  Indeed, my office is less than 25 miles from North Carolina and I've spent a great deal of time in the Outer Banks surfing.  Hence, I thought I knew the state.  Yet, since the Republican Party took control of the North Carolina legislature and governor's mansion, North Carolina has veered off into insanity.  One has to wonder how long it will be before its reputation as a moderate and pro-business state is destroyed by the GOP/Christofascist extremism.  An editorial in the New York Times looks at the rapid decline of that state.  Here are excerpts:

Every Monday since April, thousands of North Carolina residents have gathered at the State Capitol to protest the grotesque damage that a new Republican majority has been doing to a tradition of caring for the least fortunate. Nearly 700 people have been arrested in the “Moral Monday” demonstrations, as they are known. But the bad news keeps on coming from the Legislature, and pretty soon a single day of the week may not be enough to contain the outrage.

In January, after the election of Pat McCrory as governor, Republicans took control of both the executive and legislative branches for the first time since Reconstruction. Since then, state government has become a demolition derby, tearing down years of progress in public education, tax policy, racial equality in the courtroom and access to the ballot. 

The cruelest decision by lawmakers went into effect last week: ending federal unemployment benefits for 70,000 residents. Another 100,000 will lose their checks in a few months. Those still receiving benefits will find that they have been cut by a third, to a maximum of $350 weekly from $535, and the length of time they can receive benefits has been slashed from 26 weeks to as few as 12 weeks.

At the same time, the state is also making it harder for future generations of workers to get jobs, cutting back sharply on spending for public schools. Though North Carolina has been growing rapidly, it is spending less on schools now than it did in 2007, ranking 46th in the nation in per-capita education dollars. Teacher pay is falling, 10,000 prekindergarten slots are scheduled to be removed, and even services to disabled children are being chopped. 

Republicans repealed the Racial Justice Act, a 2009 law that was the first in the country to give death-row inmates a chance to prove they were victims of discrimination. They have refused to expand Medicaid and want to cut income taxes for the rich while raising sales taxes on everyone else. The Senate passed a bill that would close most of the state’s abortion clinics. 

And, naturally, the Legislature is rushing to impose voter ID requirements and cut back on early voting and Sunday voting, which have been popular among Democratic voters.

North Carolina was once considered a beacon of farsightedness in the South, an exception in a region of poor education, intolerance and tightfistedness. In a few short months, Republicans have begun to dismantle a reputation that took years to build. 

Two things strike me: (1) what the GOP is doing in North Carolina is a blue print of what the Virginia GOP wants to do in Virginia, and (2) while the GOP claims to be the party of Christian values, its actions are the antithesis to the Gospel message of Christ.