Thursday, 23 May 2013

Scott Mooneyham: For politicians, lots of blame but little control over jobs

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There may be no subject that politicians talk more about and have so little control over as jobs.

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There is good reason for it. No matter their relative impotence regarding the matter, people blame politicians for joblessness and bad economies.

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On the national level, the political actors and policymakers may have more economic levers, especially as it relates to monetary policy, than state policymakers. Even there, most economists suggest that consumer confidence and economic?innovation have a bigger effect on the economy than do the actions of the political class.

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On the state level, politicians? best bet is making policy decisions with a long view toward bolstering economic growth over years or decades.

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As I?ve written before, one of the factors that surely contributed to North Carolina?s economic growth in the 1980s was its highly regarded universities combined with its reputation as a low-tuition state.

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Sure, if you are former Govs. Jim Hunt or Jim Martin, it is nice to believe that you touched some magic button and created a high-tech boom.

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The likelihood is that policies put in place decades earlier, fostering excellence in the university system and attracting bright minds from across the country with promises of cheap access to those universities, was the closest thing to a magic button.

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Along those lines, the Republicans who now control the policy levers in Raleigh believe that rewriting tax codes and setting the table for natural gas and oil exploration can start the economic fireworks.

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Reasons abound to rework the state?s tax structure. The main ones: To be equitable, taxes should be broadly collected; to be efficient, tax collections should closely track economic growth.

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But notions that our tax structure is wildly out of kilter with the rest of the South are just flat wrong, and so tax reform is no ticket for an economic resurgence. (Anti-tax guru Grover Norquist recently held up Florida, which has no personal income tax, as an example for North Carolina to follow; Florida collects more state and local taxes, on a per-capita basis, than North Carolina.)

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As for an energy economy, GOP policymakers could prove correct. But even if massive amounts of natural gas lie underfoot in

Lee and Chatham counties, it might be years or decades before a thriving natural gas industry is created here.

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If you doubt that state policymakers are relatively limited when it comes to economic quick-fixes, it might be instructive to examine charts comparing North Carolina?s unemployment rate against that of the United States as a whole.

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Since the recession in 2008, North Carolina?s unemployment rate has generally hovered about 1.5 percentage points above the national average.?

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In all but a few months, its rises and dips have followed the rises and dips of the national rate.

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Nonetheless, just like Gov. Beverly Perdue and the Democrats before them, Gov. Pat McCrory and the Republicans will suffer if that doesn?t change.

Source: http://www.rockymounttelegram.com/opinion/columnists/scott-mooneyham-politicians-lots-blame-little-control-over-jobs-501031

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