daveswen

A 2 percent solution to a nonexistent problem

ISU economist Dave Swenson exposes how a Republican property tax bill relies on flawed assumptions and would make the “important job of governing harder” for cities and counties. -promoted by Laura Belin

It is a common canard among the anti-property taxers that city and county governments, those closest to the electorate, are gouging unsuspecting taxpayers. It is their rallying lament, and it requires no substantiation, just confident assertion.

As is frequently the case with made-up woes like this, Iowa House Republicans have a solution. The remedy is House Study Bill 165, a bill to place limits on city and county government property tax growth.

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Iowa’s 2019 economic outlook: The good, bad, and ugly

Iowa State University economist Dave Swenson reviews the evidence that President Donald Trump’s trade policy is “harming a large number of Iowans, limiting the state’s potential prosperity.” -promoted by Laura Belin

Governor Kim Reynolds’ Condition of the State address had precious little to say about Iowa’s economy, which is odd because that is something her predecessor and mentor always liked to crow about. She acknowledged that there are challenges for rural areas and that there are ongoing initiatives to promote training and placement of workers, but really said nothing about how the Hawkeye state is performing economically.

There’s plenty to say. Some of it good, some bad, and given the impacts of the President Donald Trump’s trade disputes, lots of ugly.

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A pre-election economic update

Dave Swenson is an associate scientist in Iowa State University’s Department of Economics. -promoted by desmoinesdem

Elections inspire economic promises. Whether those promises are realistic or not usually doesn’t matter. It is the economic narrative that matters, and if you hit the right chord, as the Bill Clinton campaign found with “it’s the economy, stupid,” you can milk that for all it is worth to swing an election in your favor.

The GOP retook the Iowa governorship in 2011, and there was a range of economic promises and expectations. Chief among them was the time-worn assumption that Republicans knew how to generate economic prosperity. Jobs were going to be created, household incomes were going to rise, and the state’s economic prospects were going to be righted after four years of mismanagement.

For a time things looked promising. Robust farm profits were driving strong demand for machinery and other capital investments on the farm, which supported both Main Street and manufacturing recovery. Iowa’s already strong wind energy industry continued to expand. There were huge fertilizer plants under construction on both sides of the state. Iowa had become a popular place to site data centers. A dime was added to the gas tax to boost road construction. And a controversial pipeline bisecting the state diagonally requiring hundreds of workers was laid in the ground.

So Iowa’s economy is doing great, right? Wrong. Here are just a few key indicators:

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Iowa nonmetro changes, challenges, and shifting voter preferences

Iowa State University economist Dave Swenson examines “troubling” trends in seventeen mid-sized cities (“micropolitan” areas) with core urban populations of 10,000 or more. -promoted by desmoinesdem

Iowa’s metropolitan areas are growing, a few quite smartly, but a majority of Iowa’s nonmetropolitan areas are declining, several quite sharply. These changes have implications for the vitality of and outlook for much of rural Iowa. They also have implications for dominant rural political attitudes.

As rural economies and populations transform, so too do their collective public policy preferences. Recent statewide and federal election results show clearly that nonmetropolitan Iowa has become more conservative than its historically-conservative norm. And current indications give us no reason to expect that trend to abate.

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Turning good economic news into bad news

Economist Dave Swenson explains why “a tight labor market is good for workers and good for families,” contrary to what you may have read in the newspaper. -promoted by desmoinesdem

Iowa’s enviously low unemployment rate of 3.1 percent is distressing many in the business community and, by proxy, business news. In recent months more and more people are declaring that Iowa is at full employment, and that, they say, is a problem.

It’s not. Iowa’s economy bumping up against full employment, if in fact that is happening, is a good thing. It is the stated goal of every politician’s overweening job creation rhetoric. It is what we hope for as our economy moves through the wrenching disruptions to firms and households caused by recessions. It is precisely what we want to happen: as many people are working as our economy can support.

Unless it creates discomfort in the business community. Then low unemployment is a problem. Let me explain.

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Higher Education Economic Impact Studies Are Usually Hooey

ISU economist Dave Swenson returns to the important topic of exaggerated claims about job creation and other economic impacts. -promoted by desmoinesdem

The Iowa Department of Education released a study recently claiming Iowa’s community colleges support $5.4 billion in income and 107,170 jobs in Iowa.

The claim is ludicrous, and I’ll get to the details in a bit, but it is on par with a range of private and public economic impact studies of higher education that contort econometric methods in ways never intended in order to provide ever-desperate college and university administrators with economy-benefiting claims that wow legislators and garner public support.

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