Dave Swenson

The news out of West Des Moines last week was that Microsoft will add a third data center. At first glance, a data center cluster looks to be popping-up in Iowa. We have the three Microsoft projects in West Des Moines, Facebook’s two complexes on the other side of the metro in Altoona, Google’s two projects in Council Bluffs, and a smattering of smaller centers scattered about the state.

“Microsoft could build these centers anywhere in the world,” said West Des Moines Mayor Steve Gaer, as quoted in the Des Moines Register, but they’re building them right here in Iowa. A map of data centers across the U.S. tells us, though, that data centers of all sorts and sizes are just about everywhere there are people. In short, Iowa isn’t that special. Don’t tell West Des Moines.

“Phony number” graphic created by Dave Swenson

I was encouraged when Beth Townsend became Iowa Workforce Development director early this year. The previous director, Teresa Wahlert, was one of Governor Terry Branstad’s worst appointees; I suspect her record for legal entanglements involving an agency director for the State of Iowa will never be surpassed. In contrast, I’d heard consistently good feedback about Townsend’s work as executive director of the Iowa Civil Rights Commission. The new director has taken several steps to bring Iowa Workforce Development’s operations in line with federal labor laws.

Which makes it even more disappointing to see Townsend sell one of the biggest lies of Branstad’s long, long stint as governor, first in her agency’s annual budget presentation, and now in the editorial pages of Iowa’s largest newspapers.

Sidestepping what looked like an unwinnable battle with Iowa Senate Democrats, Governor Terry Branstad announced in a press release today that Teresa Wahlert will retire as head of Iowa Workforce Development. Apparently Wahlert informed Branstad on January 9 that she would step down, effective today. Iowa Civil Rights Commission Executive Director Beth Townsend will take over as acting director of Iowa Workforce Development. After the jump I’ve posted background on Townsend as well as today’s press release about Wahlert’s retirement.

Wahlert’s tenure was rocky from the start, as she only barely was confirmed to lead the agency in 2011. Iowa Senate Democrats objected to the planned closure of staffed Iowa Workforce Development offices all over the state, a policy that Wahlert later carried out despite lawmakers’ efforts to keep the offices open. (The Iowa Supreme Court eventually ruled unanimously that Branstad acted improperly when he struck language about the field offices without vetoing the money allocated to fund them, but the offices were never reopened.)

Wahlert’s conduct is also mixed up in two lawsuits filed by former senior state employees. As if that weren’t enough, an arbitrator ruled in November that Wahlert “overstepped her bounds when she promoted a judge who had been demoted after complaints that she created a hostile work environment.” For those reasons, she certainly would not have received the 34 yes votes she needed in the Iowa Senate, had Branstad re-appointed her to her current job. Today’s official press release does not acknowledge any of the controversies surrounding Wahlert’s work. Instead, the governor and Lieutenant Governor Kim Reynolds praised her leadership on worker training and job creation.

Final note: words attributed to Reynolds today greatly exaggerate the number of jobs created during Wahlert’s years in state government. No matter how many times real economists dismantle this zombie lie, the Branstad administration is hell-bent on counting only gross jobs created (a “fake” number), not net jobs created (which accounts for job losses as well). Townsend could do all Iowans a service by getting her new subordinates out of the fuzzy math business. As Mike Owen of the Iowa Policy Project argued here, the “political tainting” of Iowa Workforce Development is unacceptable: “IWD should be trying to determine and illustrate the actual job picture facing our state, so policy makers can make decisions in that light.”  

What’s on your mind this weekend, Bleeding Heartland readers? I’ve been thinking about math, or rather, the inability to do math. This fascinating article by Robert Charette exposes the “myth” of an alleged shortage of STEM (science, technology, engineering, and mathematics) workers. The real problem in the U.S., Charette argues, is “a STEM knowledge shortage.”

To fill that shortage, you don’t necessarily need a college or university degree in a STEM discipline, but you do need to learn those subjects, and learn them well, from childhood until you head off to college or get a job. Improving everyone’s STEM skills would clearly be good for the workforce and for people’s employment prospects, for public policy debates, and for everyday tasks like balancing checkbooks and calculating risks.

Speaking of public policy debates, Congressional Republicans are poised for another showdown over the debt ceiling, armed with phony concern about a “growing” federal deficit. In fact, the deficit is falling at the fastest rate in decades, but very few Americans realize that, and self-appointed fact-checkers bend over backwards not to acknowledge it.

Speaking of the inability to count, Governor Terry Branstad’s administration has touted misleading “job creation” numbers for a long time, but the latest propaganda is “inflated” even if you accept the governor’s “bizarre” practice of counting only jobs created while not subtracting jobs lost.

Politicians aren’t the only ones who let ideology interfere with basic numeracy. This must-read piece by Chris Mooney summarizes findings from a new study: “people who are otherwise very good at math may totally flunk a problem that they would otherwise probably be able to solve, simply because giving the right answer goes against their political beliefs.”  Regardless of party affiliation, research subjects with higher math skills were better at solving a problem about the effectiveness of skin cream. When the same numbers were presented as evidence related to handgun bans, liberal Democrats and conservative Republicanss were more likely to arrive at the wrong answer if the correct answer went against their opinions about gun control and crime.

This is an open thread.

On Friday the U.S. House approved a bill that would reorganize nearly three dozen federal job training programs into one fund providing job training money to states. Iowa’s four representatives split on party lines.

What’s on your mind this weekend, Bleeding Heartland readers? The Bureau of Labor Statistics released a better than expected jobs report on Friday, but not all the numbers were encouraging. States have continued to cut jobs even after the end of the “Great Recession,” and the “sequester” federal budget cuts will lead to more public-sector job losses later this year. Disappearing state government jobs are a drag on the national economy.

Surprise, surprise: the Iowa Chamber Alliance thinks shoveling more taxpayer dollars to large corporations is the best way to create jobs. The Iowa Policy Project disagrees and points out that Iowa is already writing large subsidy checks to some companies that paid no income tax in 2012. UPDATE: Forgot to mention that Iowa just agreed to give the Principal Financial Group $22.5 million in tax credits for its $285 million renovation plan in downtown Des Moines. Why should Iowa taxpayers underwrite office remodeling for a profitable company? That’s part of the cost of doing business.

Conservatives who think high tax rates can’t coexist with economic prosperity should explain why “the average Canadian household is now richer than an average American household for the first time ever.” My guess is the answer is related to Canada’s efficient, single-payer health care system (no medical bankruptcies or huge out of pocket costs because of health problems).

Senator Tom Harkin has introduced a bill to raise the minimum wage from $7.25 to $10.10 over three years before “before indexing it to keep up with the rising cost of living.” Indexing the minimum wage to inflation should have happened a long time ago.

This is an open thread.

Iowa Economic Development Authority Director Debi Durham went to the statehouse yesterday to advocate for more tax credits to use as business incentives during the next fiscal year. She inadvertently revealed that in the negotiating department, she could benefit from wisdom that President Ronald Reagan borrowed from a Russian proverb.

After landing significant state and local tax incentives, a large corporation confirmed plans yesterday to expand its fertilizer plant in Port Neal (Woodbury County). Officials hailed the “single largest capital investment” in Iowa history, eclipsing the $1.4 billion fertilizer plant project announced in September for Lee County.

More details and reaction to the CF Industries project are after the jump.

Boring, cookie-cutter commercials may not help candidates like Republican John Archer much, but at least they do no harm. The same can’t be said for Representative Dave Loebsack’s latest tv ad, unless picking a fight with a major employer in your district has some upside I’m missing.

One of Republican Mitt Romney’s latest television commercials in Iowa asserts that cutting government spending and eliminating the federal deficit will create 130,000 jobs in Iowa. Meanwhile, in states with more military bases and defense sector industry, Romney campaign advertising promises to create hundreds of thousands of jobs by reversing planned cuts in defense spending.

Three days after proudly announcing the largest set of tax incentives Iowa has ever offered to a corporation, Governor Terry Branstad criticized President Barack Obama’s “penchant for trying to pick winners and losers in the marketplace.”

Public-sector jobs continue to decline, and private-sector job growth is not nearly strong enough to make a significant dent in the national unemployment rate, according to the latest monthly jobs report from the U.S. Bureau of Labor Statistics. On the contrary, another recession is well within the range of possibilities for the coming year. Equally worrying, there appears to be no chance of passing another government stimulus package, no matter who wins the presidential election.

A bidding war between Iowa and Illinois ended yesterday, as an Egyptian company’s representative stood with Governor Terry Branstad to announce plans for a $1.4 billion fertilizer plant in Lee County. A package of state, federal, and local tax incentives worth hundreds of millions of dollars will support the project, costing taxpayers more than $1 million for each of the 165 permanent jobs created.

After failing to deliver on its promises, a Cedar Rapids company has agreed to pay back–with interest–a $250,000 loan the Iowa Economic Development Authority awarded last year. Solid reporting by a local journalist may have made the difference between this case and the sad story from Webster City, which Bleeding Heartland discussed here.

Catching up on some sad news from last week, no electric cars will roll off assembly lines in Webster City. On the contrary, the city will be lucky to get back money it loaned to a company that never delivered on its owner’s promises.

A week doesn’t go by without some new ad related to the presidential campaign hitting the Iowa airwaves. The latest commercials from the Barack Obama and Mitt Romney campaigns are after the jump, along with highlights from Romney’s event in Council Bluffs on Friday.  

Speaking in Des Moines this afternoon, Mitt Romney promised to lead the country “out of this debt and spending inferno” by reducing federal government spending from 24.3 percent of the country’s gross domestic product to 20 percent of GDP within four years. Romney would address what he called a “prairie fire of debt” by moving some federal programs to the state level or the private sector, repealing “Obamacare,” reforming Medicare and Social Security, and reducing “redundancy and waste” in government programs.

I’ve posted the full prepared text of Romney’s remarks after the jump, along with a few comments.

Governor Terry Branstad’s education reform blueprint called for higher academic standards and better methods to assess student skills. I just hope my kids don’t learn to count the way the governor counts jobs created in Iowa.

The word “devastating” is overused in political commentary, but I can’t think of a better way to describe the television commercial President Barack Obama’s re-election campaign rolled out today. The fifth commercial the president’s team has run in Iowa since the beginning of April is in my opinion the most effective by far. (The previous ads claimed Republican Mitt Romney “stood with Big Oil,” accused Romney of shipping jobs overseas and maintaining a Swiss bank account, put a positive spin on Obama’s record, and highlighted the unpopular decision to bail out the auto industry.)

The new spot is two minutes long and features workers who lost their jobs after Bain Capital took over GST Steel in Kansas City. The video and transcript are after the jump. UPDATE: Added a new web video from the Romney campaign and two new anti-Obama commercials the American Future Fund is running on cable television in several swing states.

Republican Congressional candidate John Archer is up on cable television with a new commercial promoting his jobs plan. Follow me after the jump for the video, transcript, and analysis.

Beef Products, Inc. announced yesterday that it will permanently close three factories in Waterloo, Iowa, Amarillo, Texas and Garden City, Kansas. BPI suspended operations at those plants in March, following public controversy over lean finely textured beef, which detractors call “pink slime.” The Waterloo facility employed 200 people, who will be jobless effective May 25.

Comments from Governor Terry Branstad, Senator Chuck Grassley, and Representative Bruce Braley are after the jump. Branstad and Grassley criticized what they have called a “smear campaign” against lean finely textured beef. Braley, who previously called for a Congressional investigation into media claims about the product, expressed regret that “the facts have been lost in the furor” over lean finely textured beef.

President Barack Obama’s campaign launched a new television commercial today in nine swing states, including Iowa. The 60-second spot and annotated transcript are after the jump. This commercial focuses on how the president dealt with the challenges facing him when he took office. Unlike the Obama campaign’s last tv ad, this one does not mention his Republican opponent, Mitt Romney.

Approximately 44 percent of Iowa workers earning less than $10 per hour have at least some college education, according to data compiled by Janelle Jones and John Schmitt of the Center for Economic Policy Research.  

Recreation on Iowa rivers generates enough economic activity to support about 6,350 jobs, according to a new study by Iowa State University’s Center for Agricultural and Rural Development.

Unfortunately, a new report by Environment Iowa indicates that this state’s rivers are among the country’s most polluted waterways.

Follow me after the jump for excerpts from both reports, published last week.

What’s on your mind this weekend, Bleeding Heartland readers? I’m catching up on two stories I didn’t have time to write about during the past week: President Barack Obama’s choice of Jim Yong Kim to be next president of the World Bank, and Vice President Joe Biden’s March 28 visits to Davenport and Sioux City. Kim was born in South Korea but grew up in Muscatine, where his family moved when he was five years old. More clips about Kim and Biden’s latest Iowa trip are after the jump.

Sad news from the south side of Des Moines: Cha Cha, the male lion at the Blank Park Zoo, was euthanized this week after being diagnosed with inoperable liver cancer. He was 16 years old.

This is an open thread; all topics welcome.  

Iowa politicians from both parties are speaking out today in defense of finely textured beef product, now commonly known as “pink slime.” The U.S. Department of Agriculture announced earlier this month that it will give schools the option of buying ground beef that does not contain the product. Several grocery store chains have recently announced that they will stop carrying ground beef containing the product, prompting Beef Products Inc. to suspend production of finely textured beef product at three plants for 60 days. One of the closed plants is in Waterloo. BPI is leaving its plant in South Sioux City, Nebraska running for now.

Iowa political reaction to the controversy is after the jump.

Democrats Bruce Braley (IA-01), Dave Loebsack (IA-02), and Leonard Boswell (IA-03) joined Republicans Tom Latham (IA-04) and Steve King (IA-05) in voting yesterday for the Senate version of a bill designed to help small business start-ups. The five representatives all supported the original version of the bill earlier this month. Republican Chuck Grassley also voted for the bill when it came before the Senate last week, but Democrat Tom Harkin opposed it over concerns it would further deregulate Wall Street and undermine investor protections. After yesterday’s vote, Braley hailed the bipartisan action to “reduce small business restrictions,” while Loebsack highlighted provisions he advocated to promote small businesses owned by womens, veterans, and minorities. I enclose those statements at the end of this post.

Also on March 27, the U.S. House approved a bill designed to weaken the Federal Communications Commission’s ability to regulate. Iowans split on party lines. Follow me after the jump for details on that bill and various amendments debated on the House floor yesterday.

Yesterday the U.S. Senate approved an amended version of the Jumpstart Our Business Startups (JOBS) Act, which is supposed to make it easier for entrepreneurs to start small companies. All five Iowans in the U.S. House voted for this bill two weeks ago, but Iowa’s senators split on party lines.  

The U.S. House approved the Jumpstart Our Business Startups (JOBS) Act today by an overwhelming majority. All five Iowans were among the 390 votes for passage (roll call). Details on the legislation are below.

UPDATE: The Democratic Congressional Campaign Committee is hammering House Republicans for keeping certain amendments out of the otherwise bipartisan JOBS Act. I’ve enclosed DCCC press releases naming Tom Latham and Steve King below.

Des Moines was second only to Washington, DC in the latest Forbes magazine report on the best cities for high-paying jobs.

Christie Vilsack toured Iowa’s new fourth Congressional district late last week to roll out an energy plan “geared towards bringing a new prosperity to Iowa’s small cities and rural communities by creating layers of economic opportunity.”

The five-point plan is more of a political statement than a detailed policy document. Like some of Vilsack’s previous proposals, it embraces some Republican talking points.

Upon closer examination, the energy plan looks like two parts bipartisan no-brainers, two parts conservative buzzwords, and one part fairy dust.

The U.S. Postal Service announced yesterday that it will keep mail processing facilities in Waterloo and Cedar Rapids open, saving hundreds of jobs.

Anyone else in the Bleeding Heartland community not planning to watch the Superbowl tonight?

Jobs are on my mind this weekend. On Friday the Bureau of Labor Statistics released some encouraging employment numbers. On the same day, news broke about proposed Air Force cuts that could eliminate around 500 jobs in the Des Moines area.  

President Barack Obama hits the road today through Friday to promote proposals from last night’s State of the Union address. Cedar Rapids is the first stop on his itinerary, which also includes Phoenix, Las Vegas, Denver, and Detroit. All cities are in states Obama hopes to win or at least put in play this November.

Follow me after the jump for links on the president’s Cedar Rapids visit. I will update this post later with highlights and reaction.

After more than five hours of debate, the Iowa House on April 26 approved a bill to let MidAmerican Energy charge consumers for costs associated with a nuclear reactor it may or may not build in the coming decade. House File 561 passed 68 to 30. All Republicans present except two voted yes, joined by 12 House Democrats: Deborah Berry (district 22), Chris Hall (district 2), Minority Leader Kevin McCarthy (district 67), Dan Muhlbauer (district 51), Pat Murphy (district 28), Rick Olson (district 68), Brian Quirk (district 15), Mark Smith (district 43), Phyllis Thede (district 81), Andrew Wenthe (district 18), John Wittneben (district 7) and Mary Wolfe (district 26). The remaining 29 House Democrats voted against the bill. Two Republicans voted no: Guy Vander Linden (district 75) and Kim Pearson (district 42).

Details on the House debate and efforts to amend the bill are after the jump, along with some speculation about its prospects in the Senate and thoughts about the coalitions lobbying for and against it.  

The Iowa Senate confirmed six of Governor Terry Branstad’s appointees to state offices and boards yesterday, but Democratic senators indicated that two of the governor’s picks may not receive the two-thirds vote needed in the upper chamber. Meanwhile, Branstad suggested at his weekly press conference that race may be a factor in opposition to Isaiah McGee as director of the Iowa Department of Human Rights.

Follow me after the jump for more on who was confirmed yesterday and the battles coming later this week.

UPDATE: On April 12 the Senate rejected McGee as well as William Gustoff, one of Branstad’s appointees to the state Judicial Nominating Commission. Senators confirmed Teresa Wahlert with two votes to spare and three members of the Environmental Protection Commission. Details on the April 12 votes are below.

Governor Terry Branstad’s plan to transform the Iowa Department of Economic Development into a public-private partnership won approval from the Iowa House this week. House File 590 would create an Iowa Partnership for Economic Progress, with three separate boards supervising various aspects of economic development work. Supporters say they have worked to make Branstad’s preferred model more transparent, but its convoluted structure invites the kind of abuses seen in other states where private entities have control over economic development incentives.

More details on House File 590 and its path through the Iowa House are after the jump.

“The Unsafe Bridges of Iowa Counties” wouldn’t be an appealing feature film, but it could be an appropriate subject for a documentary. The Transportation for America coalition released a report today on the state of bridges in the U.S., and the results are not pretty for Iowa. Nationwide, “69,223 bridges – 11.5 percent of total highway bridges in the U.S. – are classified as ‘structurally deficient,’ requiring significant maintenance, rehabilitation or replacement.” Table 1 and Appendix A of the full report (pdf) rank the states by percentage of structurally deficient bridges. Iowa’s percentage is nearly twice the national average: 21.7 percent of our state’s bridges are deficient. Only Pennsylvania and Oklahoma scored worse on this metric. Iowa is among just five states in which more than 20 percent of bridges are structurally deficient.

Appendix B shows the two busiest structurally deficient bridges in each state. In Iowa, those are an I-80/I-35 bridge over a drainage ditch in Polk County (average daily traffic 82,100 vehicles) and an I-29 bridge over the Floyd River in Woodbury County (average daily traffic 42,100 vehicles).

Appendix C shows the 100 worst counties nationwide in terms of percentage of deficient bridges. Iowa has 17 counties on this list, more than any other state.

Iowa has an unusually large number of towns and more road miles per capita than any other state, to my knowledge. Historically, our state’s political leaders have been reluctant to borrow to pay for infrastructure needs, which explains Iowa’s relatively low debt load and the furious Republican reaction to the last administration’s I-JOBS infrastructure bonding initiative. Some states routinely borrow to cover infrastructure projects, including our neighbor to the north. I wonder if Minnesota’s much larger state borrowing than Iowa over the years is one reason the state does relatively well in Transportation for America’s report (8.8 percent of bridges in the state are structurally deficient).

In the past, federal highway money has gone predominantly toward building new roads. The Transportation for America report advocates more federal assistance to states for fixing roads and bridges:

Allowing roads and bridges to slip into disrepair ultimately costs state and local governments billions more than the cost of regular, timely repair. Over a 25-year period, deferring maintenance of bridges and highways can cost three times as much as preventative repairs. The backlog also increases safety risks, hinders economic prosperity and significantly burdens taxpayers.

Preservation efforts can also extend the expected service life of a road for an additional 18 years, preventing the need for major reconstruction or replacement.4 In addition to the safety imperative, investing in the construction, expansion and repair of our nation’s transportation infrastructure creates jobs today while laying the foundation for long- term economic prosperity. Repair work on roads and bridges generates 16 percent more jobs than construction of new bridges and roads.5

A recent report on the use of federal stimulus funds for transportation showed that maintenance projects created more jobs per dollar spent than new road construction.

Transportation for America’s full report is here. After the jump I’ve posted the 17 Iowa counties that made Appendix C (worst 100 counties nationwide) and the percentage of deficient bridges in each. I also posted an excerpt from the report explaining the criteria for naming a bridge “structurally deficient.”

This page at Transportation for America’s website includes a map and chart with information about all 99 Iowa counties: number of bridges, number of structurally deficient bridges, percent of bridges that are structurally deficient, bridge average annual daily traffic and average daily traffic on structurally deficient bridges. After the jump I’ve posted an excerpt from that page showing Iowa’s five best and five worst counties in this area.

Approximately 7,000 Iowans who have been out of work for at least a year have lost their chance to receive an extra 13 weeks of unemployment benefits at the federal government’s expense. The 2009 stimulus (American Recovery and Reinvestment Act) included a provision “to fund the entire cost of extended unemployment benefits through the end of 2011, rather than requiring states to pay half of the cost.” States with unemployment rates of at least 6.5 percent could qualify for 13 weeks of extended benefits, and states with unemployment rates exceeding 8 percent could qualify for 20 weeks of extended benefits.

Iowa was among nine states that did not pass enabling legislation (a “Total Unemployment Rate trigger”) to take advantage of that portion of the stimulus. Democrats in the Iowa Senate recently approved a bill on a mostly party-line vote and urged the Iowa House to act by March 10. New employment figures to be released on that date were expected to bring Iowa’s three-month average unemployment below the threshold for qualifying for the federal stimulus program. Indeed, Iowa Workforce Development confirmed that the state’s unemployment rate held steady at 6.1 percent in January, bringing the three-month average rate down to 6.1 percent.

Governor Terry Branstad didn’t advocate for the enabling legislation, and House Republican leaders decided not to move the bill:

“[T]he House Republican caucus is not interested in making it harder to be an employer in the state of Iowa,” said House Speaker Kraig Paulsen, R-Hiawatha. “What’s going on with unemployment compensation right now is making it harder to be an employer.”

I believe Republicans misunderstood the essence of this program. As the National Employment Law Project explained in a February report, the stimulus act included full federal funding for these extended benefits. Note: that report estimated that about 29,000 Iowans could potentially receive the 13 weeks of extended unemployment benefits. Iowa Senate Democrats estimated that about 7,000 would qualify. That’s a relatively small percentage of the 102,000 unemployed Iowans, but roughly $14.5 million in benefits divided among 7,000 people would have meant a lot of extra disposable income in communities with high jobless rates.

It’s lamentable that Republicans declined to act on behalf of Iowa’s long-term unemployed. In addition to helping jobless individuals, unemployment benefits have a powerful multiplier effect in local economies, because the people who receive them tend to spend the money quickly on goods and services they could not otherwise afford.

Democrats in the Iowa House and Senate share the blame for not passing the Total Unemployment Rate trigger during the 2010 legislative session. When the stimulus went into effect in 2009, Iowa’s unemployment rate was too low to qualify for that money (though state officials did secure unemployment benefits through a different part of the stimulus). But in early 2010, Iowa’s unemployment rate exceeded 6.5 percent. If the Iowa House and Senate had passed enabling legislation, Governor Chet Culver surely would have signed it, and some jobless Iowans would already have received the extra federal funding.