Ohio Chambers Urge 'Redesigning Ohio'

Dec. 20, 2010 9:00 a .m.

Published by The Business Journal, Youngstown, Ohio.

 

YOUNGSTOWN, Ohio -- Gov. Elect John Kasich enjoyed substantial business support during his successful gubernatorial campaign. Now the state's chambers of commerce are offering him suggestions regarding how to address the fiscal challenges facing state and local government.

 

"Redesigning Ohio," a report being unveiled today at news conferences in Columbus and Akron, "offers a road map for long-term, transformational change as well as meaningful recommendations for tackling our current fiscal crisis," its executive summary states.

 

more: http://business-journal.com/ohio-chambers-urge-redesigning-ohio-p18187-1.htm

Without any details it's impossible to have an opinion.

 

"produce fewer governments, lower costs and more value."

 

Add 'sharpen the saw', and 'win-win', and you have a true para-diggum changer.

 

Let me know when someone (chambers, Kasich...anyone) has some details we can dig into.

 

 

Most of those ideas look good on paper.

Most of those ideas amount to "lay people off" and/or "pay people less."  That's no redesign of Ohio, it's just typical Chamber suggestions, most of which have already been granted or are currently underway.

 

I have no doubt that some cutbacks are necessary at this point.  But part of the reason for the deficit is Taft's massive reducton in business taxes, which I believe is now fully phased in, and these cuts are an inevitable part of that approach.  On what sort of timetable are the tax cuts expected to draw business investment and create private-sector jobs?  Does this trickle-down approach need to prove itself in any way?  Because job losses in state and local govt, and the effects they have on local economies, won't be too hard to measure. 

Damn those Chamber folks, caring bout commerce and all.

No wages = no discretonary income = no commerce.  If the plan is to produce discretionary income through prvate sector job growth, that's wonderful.  When will it take place?  So far we've already put more $ in the pockets of busnesses via tax cuts, and we're about to slash state and local payrolls to close the resulting deficit.  Doesn't seem too much to ask that said businesses start a-payin' sometime soon.  When?  By all means, commence commerce.

Somebody has to pay taxes who isn't paid by taxpayers.

Here's the PD article link. http://www.cleveland.com/open/index.ssf/2010/12/metro_chambers_of_commerce_mak.html

 

They're bringing up regionalism talking points so it ain't all that bad.

COC's are very useful advocates in our society, but we must not lose sight of the fact that they are advocates and have specific interests they would advance at the expense of others.  Same goes for environmental groups.

When I clicked the Business Journal link, I was hoping for regionalism material and didn't find much of it.  The PD version also mentions closing 3 prisons in favor of a "community-based system," also not bad.  A Tale of Two Summaries.... let's see the plan itself.  The business lobby would be a welcome ally for regionalism.

No wages = no discretonary income = no commerce. If the plan is to produce discretionary income through prvate sector job growth, that's wonderful. When will it take place? So far we've already put more $ in the pockets of busnesses via tax cuts, and we're about to slash state and local payrolls to close the resulting deficit.   Doesn't seem too much to ask that said businesses start a-payin' sometime soon. When? By all means, commence commerce.

 

Supply and Demand can dictate what salaries they pay, then as times go well, discretionary income rises, othertimes it falls. We do not need an artificial prop to make sure people have a suitable income, the market establishes that.

^No minimum wage then?

I have to agree with 327.  All those tax cuts in the early 2000s sure don't seem to have not created jobs.

 

Back in the early 1900s there was no minimum wage, and we had a lot more people living on the street.  The Free Market and living by Supply and Demand alone mean Survival of the Fittest -- and those who can't be successful in the market can go to hell.  Who cares.  If only THOSE POOR PEOPLE had worked harder, not made bad decisions, stayed in school, etc., etc. 

 

Compassionate conservatism exemplified. 

 

 

The free market does not have anti-trust laws, but I don't see even the staunchest conservatives arguing for a return to the days of monopolies.

^ No minimum wage. The minimum wage only creates wage inflation and contributes to the rising cost of goods and increased cost of labor. When the minimum wage goes up, it does little to increase the buying power of those making it because it contributes to wage push throughout the scale. It is a meaningless inefficient way to determine earnings but there are a number of bleeding heart politicians who know nothing about economics that think it is actually helping the poor

Any workplace regulations?  Or does the free market just take care of all that too?

I have to agree with 327. All those tax cuts in the early 2000s sure don't seem to have not created jobs.

 

Back in the early 1900s there was no minimum wage, and we had a lot more people living on the street. The Free Market and living by Supply and Demand alone mean Survival of the Fittest -- and those who can't be successful in the market can go to hell. Who cares. If only THOSE POOR PEOPLE had worked harder, not made bad decisions, stayed in school, etc., etc.

 

Compassionate conservatism exemplified.

 

 

 

I do not think anyone will argue for pure captialism as Adam Smith describes. That is untenable. I think most "compassionate conservatives" and libertarians even agree with some  checks in the system to balance things out and help the poor. The minimum wage is not one of them, it is a pure arbitrary figure that only contributes to wage push and inflation, it is not a real wage. Social Security and even some forms of wel-fare could be argued to serve a better purpose of providing a safety net.

 

I do not think  anyone thinks monopolies should be unregulated and that they should return to the policies of the 19th century but, at the same time there does not need to be laws everytime someone gets taken advantage of either. The market can regulate itself in many of these cases in the long run.

Business Group Presents Budget Proposals

 

http://www.onntv.com/live/content/onnnews/stories/2010/12/20/story_chamber_of_commerce.html?sid=102

 

...

 

They also put potential tax increases on the table which is something Kasich has not been receptive to, reported ONN's Jim Heath.

 

The group estimates that their savings only total $1.4 billion dollars, just an eighth of the projected deficit.

 

...

I have to agree with 327. All those tax cuts in the early 2000s sure don't seem to have not created jobs.

 

Back in the early 1900s there was no minimum wage, and we had a lot more people living on the street. The Free Market and living by Supply and Demand alone mean Survival of the Fittest -- and those who can't be successful in the market can go to hell. Who cares. If only THOSE POOR PEOPLE had worked harder, not made bad decisions, stayed in school, etc., etc.

 

Compassionate conservatism exemplified.

 

 

 

I do not think anyone will argue for pure captialism as Adam Smith describes. That is untenable. I think most "compassionate conservatives" and libertarians even agree with some checks in the system to balance things out and help the poor. The minimum wage is not one of them, it is a pure arbitrary figure that only contributes to wage push and inflation, it is not a real wage. Social Security and even some forms of wel-fare could be argued to serve a better purpose of providing a safety net.

 

I do not think anyone thinks monopolies should be unregulated and that they should return to the policies of the 19th century but, at the same time there does not need to be laws everytime someone gets taken advantage of either. The market can regulate itself in many of these cases in the long run.

 

Actually, classical economics argues against the need for antitrust laws in most cases: Monopolies without state protection are inherently unstable in the long run even as the profit handsomely in the short run.  Think of how many industry-dominating companies have risen and fallen over the years without any help from federal antitrust authorities.  Look back on the last fifteen years and then go back nearly thirty to the breakup of AT&T.  Had the federal government simply waited another decade, it's entirely likely that the shift to broadband nationwide would have been faster as people responded to the economic pressure to escape AT&T's monopoly ... and an exit option arose.  On the world stage, look at the declining influence of the once-dominant OPEC oligopoly.

 

The real problem with our antitrust laws today is the regulatory apparatus that has grown up around them, which has a very broad and ill-defined purview because the trigger of federal antitrust law is any "conspiracy in restraint of trade."  This means a great deal of bureaucratic red tape (and, inevitably, lobbyists getting rich in D.C.--administrative agency lobbyists are every bit as in demand as lobbyists with direct access to legislators themselves) whenever a company wants to buy out a large competitor.  The Sirius-XM merger comes to mind.  The feds were concerned about the monopolization of satellite radio, and the regulatory delay caused a lot of pain (to companies which, at the time, weren't all that healthy even combined; they still has a lot of financial problems, in fact).

 

The minimum wage has likewise been routinely critiqued in economic literature as a theoretical matter, but it's still low enough that it barely matters in practical terms.  Productivity-enhancing technology is strong and widespread enough today that even a startup business should be able to get $7.25 (or whatever it is) worth of productivity even from new hires today.  Obviously, a minimum wage of $25 would be more crippling.

 

As for "workplace regulations," that's a pretty broad umbrella.  As an example of a place in which the government is clearly in the right, one need look no farther than Massey Energy; its CEO even got reprimanded by some of its own major shareholders for its "<a href="http://crooksandliars.com/susie-madrak/investors-ask-blankenships-resignatio">confrontational approach to regulatory compliance</a>."  BP likewise was getting cited for safety infractions orders of magnitude more often than many of its other major oil company competitors.  Other cases are not so cut and dried, though.

Sure, monopolies might be unstable in the long run.  In the long run, our economy will pick up and companies will start hiring again.  What should the unemployed carpenter do in the meantime?  Particularly now that his 99 weeks of unemployment insurance runs out next week?

 

If the minimum wage is so low that it "barely matters," it isn't significantly impacting the economy and shouldn't even be an issue. 

 

Massey Energy is a bad example.  They have been cited for safety violations thousands of times, gone to court to contest fines, and continue to run unsafe mines and make significant profits (their stock price has doubled within the past year).  Massey has about 35 underground mines.  Around the time of the accident that killed the miners at Massey's Upper Big Branch mine, the government proposed $1.77 million in fines for safety violations at that mine, but Massey had only paid about $365,000 and contested most of the difference.  Still, the government did not shut down the mine (as they have the authority to do) and miners died.  Massey isn't worried about following regulations, because the government isn't enforcing them.  Their profits more than cover the fines, and they can keep the fines tied up in court and delay payment for years and years.  Massey is a good example of how private industry is not self-regulating, and Government regulation does not always work either.

 

Government regulation, and citizen involvement and monitoring of government behavior is necessary and good for everyone.  Trickle down economics does not work for anyone but the people at the top. 

Sure, monopolies might be unstable in the long run. In the long run, our economy will pick up and companies will start hiring again. What should the unemployed carpenter do in the meantime? Particularly now that his 99 weeks of unemployment insurance runs out next week?

 

It's impossible to tell any hypothetical individual as an individual what he should do.  He should do what's right for him.  What he should not do is continue to expect handouts into infinity.

 

If the minimum wage is so low that it "barely matters," it isn't significantly impacting the economy and shouldn't even be an issue.

 

I agree; my post said as much.

 

Massey Energy is a bad example. They have been cited for safety violations thousands of times, gone to court to contest fines, and continue to run unsafe mines and make significant profits (their stock price has doubled within the past year). Massey has about 35 underground mines. Around the time of the accident that killed the miners at Massey's Upper Big Branch mine, the government proposed $1.77 million in fines for safety violations at that mine, but Massey had only paid about $365,000 and contested most of the difference. Still, the government did not shut down the mine (as they have the authority to do) and miners died. Massey isn't worried about following regulations, because the government isn't enforcing them. Their profits more than cover the fines, and they can keep the fines tied up in court and delay payment for years and years. Massey is a good example of how private industry is not self-regulating, and Government regulation does not always work either.

 

Private industry is not self-regulating on all fronts ... but Massey Energy was a uniquely bad actor.  There were news stories at the time about other mines in the Appalachians that had only a tiny handful of safety citations, whereas Massey was subject to hundreds.

 

Government regulation, and citizen involvement and monitoring of government behavior is necessary and good for everyone. Trickle down economics does not work for anyone but the people at the top.

 

Some government regulation is.  Some isn't.  And regulatory intrusiveness is completely orthogonal to the merits of trickle-down economics.  You're confusing policies and parties.  Just because the GOP typically supports deregulation and supply-side economics doesn't mean that the two are the same thing.  You could easily design a deregulated system with a highly progressive tax rate (in fact, that is exactly the system Warren Buffett advocates), or a tightly regulated economy with a comparatively low tax burden (though why you'd want that, I have no idea).

Sure, monopolies might be unstable in the long run.  In the long run, our economy will pick up and companies will start hiring again.  What should the unemployed carpenter do in the meantime?  Particularly now that his 99 weeks of unemployment insurance runs out next week?

 

It's impossible to tell any hypothetical individual as an individual what he should do.  He should do what's right for him.  What he should not do is continue to expect handouts into infinity.

 

Assume that I'm the carpenter and I'm willing to work.  I'll do anything, not just carpentry.  I've been looking for two years now and other than some temporary part time work here and there there just aren't ANY jobs.  I don't want a handout, but a job! 

 

I disagree that we should tell our fellow Americans that we'll just help them for 99 weeks and that's it -- live on the street if you have to. 

 

The economy is in a unique situation, one that we haven't seen since the 1930s.  There are no jobs.  We (government) should continue to help people get by until companies start unloading some of their piles of cash on new hires.  You won't live very comfortably on unemployment insurance "handouts" -- it's barely enough to get by on. 

 

 

I understand that regulation and economics are separate.  Let me separate the following points.

 

(a) supply side economics doesn't seem to work for anyone but the rich.  We have lower taxes on the wealthy now than we have had in decades, and taxes have been reduced on the upper tax brackets since 2000.  So there has been enough time for the tax cuts to "trickle down."  Why do we not have more jobs?  Why are corporations sitting on more cash than ever?  Why are more Americans below the poverty line now?  If cutting taxes benefits everyone, why have the rich done better and the poor done worse in the past decade? 

 

(b) This country did very well under a highly progressive tax rate scheme through the 1960s.  There are a lot of ways to simplify the tax system, however, that I think everyone would benefit from.  Fewer or no deductions.  Perhaps no or fewer state or local taxes -- reduce the number of tax collection agencies.  At any rate, Ohio is going to have to make significant cuts in spending, and should also consider raising some taxes.  Some of us can afford to pay more and stand to lose more if spending is cut too deeply.

 

© government and regulation both work fairly well, if you have citizen and press involvement in monitoring the regulator and the regulated.  I argue that the lack of an effective press and low citizen involvement have led to problematic regulations and poor enforcement of those regulations.  More citizen involvement in the political process would improve both.  No system is perfect, but I prefer a small drag on the economy due to reasonable regulation than the "drag" on the workers caused by no regulation.  Ohio would do well to review and simplify all regulations, but I don't think "no regulation" would be good for Ohio.

 

 

Even though I think that the Chamber's recommendations are generally too vague and raise a lot more questions, after reading the full report I think it does present a way forward for further discussion.  I hope every Ohioan joins the discussion.

 

^ The company did not do well in the 60's as the tax burden continually grew higher and higher. The ecomony boomed in the postwar years from 1945-1964 approx, as the US was the chief industrial power having to supply goods to the rest of the wolrd. As the rest of the world rebuilt, the US competitve advange started to decline. As you remember it was in the 1960's that the first imports from Japan began showing up in the US.

 

The steel industry that collapsed in the early 70's was not because of any event or policy that occured during 1971 or 72 etc, but it was from actions that were occurring in the 1960's and earlier. Similar, the US Car industry collapse was a long time in the making and not the result of the Bush or Obama administration or even the fault of the CEO in charge that saw its demise (although he did contribute to it). The groundwork for the auto failure was laid a generation prior to that occurring dating back to the 1980s decisions that ceded market share to competitors.

 

To argue that supply side economics does not work does not capture the proper time frame. If looking at the policy over a 24 month period you will not see the benefit of these policies. If you look at the results 8-10 years later, there are more positive results (take the Reagn polcies of the mid 1980's they were not truly effective until early 1990s when Clinton took office. Similarly, the Keynesian approach used by FDR in the New Deal has been seen as prolonging the Great Depression for years longer than it would have been if more of a supply side or hands off policy had been used.

Ditto to Brutus Buckeye!

 

Ohio needs to begin by copying all the growing states by becoming a right to work state, cutting spending and taxes, refocus priorities for real growth, and really make Ohio a highly desirable place to work and live.

To argue that supply side economics does not work does not capture the proper time frame. If looking at the policy over a 24 month period you will not see the benefit of these policies. If you look at the results 8-10 years later, there are more positive results (take the Reagn polcies of the mid 1980's they were not truly effective until early 1990s when Clinton took office. Similarly, the Keynesian approach used by FDR in the New Deal has been seen as prolonging the Great Depression for years longer than it would have been if more of a supply side or hands off policy had been used.

 

The studies that I have seen have been inconclusive on that point, sort of a yes-and-no conclusion.  Take the current recession.  Without the (Keynesian) stimulus, the job losses and tanking of the economy would have been a LOT worse.  But arguably the recovery, when we did finally hit bottom, probably would have been faster.  The first two or three years might look similar under either approach, but ten years out the Supply Side approach probably comes out ahead for the economy as a whole. 

 

But what do the working poor, suddenly not working, suddenly without income for several years, do in the meantime?  It's in the details of what the workers are to do while waiting for the economy to recover where Supply Side theory seems to come apart. 

 

Keynesian policies might lengthen the recession, but they keep people from starving in the meantime.  WWJD?

 

 

Ohio needs to begin by copying all the growing states by becoming a right to work state, cutting spending and taxes, refocus priorities for real growth, and really make Ohio a highly desirable place to work and live.

 

What really makes Ohio a good place to work and live?  Texas ranks high on all the lists -- fewest unions, lowest taxes, fewest regulations, things you argue for, but also ranks high in largest %poverty and has one of the largest budget deficits in the country. 

 

Can you be more specific about what Ohio should stop spending money on?  Parks?  Roads? Police?  Teachers? Schools? Libraries?  In my opinion, Ohio would be an even nicer place to live if we spent more money on those things. 

 

We already aren't spending enough to maintain all the miles of roadway that we have in Ohio.  How are we going to pay for continued maintenance while spending less? 

 

I'm in favor of paying more for better service.

 

 

 

 

 

What specifically would you have would really make Ohio a desirable place to work and live?  Your list is undoubtedly different from mine, but here are a few of the things that I really like about living in Ohio. 

 

Education, parks, great museums and libraries, walkable neighborhoods (at least mine is) with great restaurants and coffee shops and friends working nearby, great forests/rivers/streams/ponds/lakes, changing seasons (nearby skiing in winter, camping in the fall, summers at the lake, gardening in the spring and summer), and local music and beer and sports teams (including my summer softball buddies) and festivals.  Taxes and regulations cause me few problems when I think of the things that I really enjoy about Ohio.