Scott's Not Working

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Broken Promise

In his April 14, 2014, announcement that he will run for a second term as Governor, Scott Walker had the chutzpah to tout his success in leading an economic recovery in Wisconsin. But the figures don't lie. Here's Politifact's latest accounting (as of April 1, 2014) on the jobs front:

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Faking the Business Creation Numbers

On October 9, 2013, The Business Journal reported that Governor Walker "continued ... to downplay his 250,000 jobs pledge from his gubernatorial campaign, instead focusing on two other numbers he says are key indicators of the state's economic success and potential: 11,590 and 1." Walker apparently blamed "employer concerns caused by protests in Madison, recall elections and the Affordable Care Act" for the state's failure to grow the way he had promised. So he is turning instead to two different measures of his "success": the growth of "new businesses" since he took office and a forecast for economic growth from the Federal Reserve Bank of Philadelphia.

The trouble is both measures are deeply flawed. Take the claim about "new businesses." The article in The Business Journal notes that the number Walker is using "include about 15 different types of business classifications." It does not note, however, that among those 15 types are such things as Little League Teams, Girl Scout Troops, Lions and Rotary Clubs, birdwatchers, a host of community organizations and other non-profits. The categories also include "out-of-state corporations that have to file papers in Wisconsin, but have no real physical presence in the state [plus] multiple filings for one business" (Uppity Wisconsin, November 13, 2013).

The actual number of economically significant new businesses created in Wisconsin since Scott Walker took office? 4,024 -- according to the Quarterly Census of Employment and Wages conducted by the Bureau of Labor Statistics. As Uppity Wisconsin points out, "the QCEW count is-- as Walker has pointed out almost daily-- an actual hard-count census of nearly all the businesses in the state with actual employees.  It is clearly the most precise measurement for keeping track of job and business creation under Walker" (Uppity Wisconsin, October 5, 2013).

As for the "WE'RE NUMBER ONE!" claim about Wisconsin's economic forecast,

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Wisconsin Lags Region & Neighbors in Economic Growth

Does a rising tide lift all ships equally? Not if the ship is Scott Walker’s Wisconsin. The US Dept. of Commerce recently released 2012 real GDP growth by state for 2012. (Real GDP is Gross Domestic Product, adjusted by inflation). For 2012, U.S. real GDP grew by 2.5%. The Department’s Bureau of Economic Analysis (BEA) divides the U.S. into 8 regions. Wisconsin, together with Illinois, Indiana, Ohio and Michigan, is part of the Great Lakes region. The Great Lakes Region saw real GDP growth of 2.2%, slightly trailing the overall U.S. real GDP growth rate.

lagging_growth_WI.jpgHow did Wisconsin compare with our neighboring Great Lakes states? The BEA data are as follows:

  • Indiana – 3.3%
  • Ohio – 2.2%
  • Michigan – 2.2%
  • Illinois – 1.9%
  • Wisconsin – 1.2%

That’s right – Wisconsin came in dead last among the states in the Great Lakes Region.

You may ask “But what about Minnesota? Iowa? Wisconsin adjoins those states. Wouldn’t that be a better comparison?” Good question, but alas there is no comfort to be gained there. Minnesota and Iowa are part of the Plains region. Their 2012 real GDP growth rates were:

  • Minnesota – 3.5%
  • Iowa – 2.4%

Time for a new Captain on the Wisconsin Ship of State?

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