Corporate Patriotism: Bernie-Style!

Bernie Sanders, fresh from never drawing a paycheck other than from coffers filled with taxpayer dollars,  now describes corporations as “deserters” for using existing law and the existing tax code to reduce their aggregate tax burden.  In other words, Bernie wants to squash inversions.

But let’s ask Big Boy Bernie a question:  Who writes the laws?  Congress.  Who has established the highest corporate income

The only "worker" Bernie approves of cheers for the hammer and sickle.

The only “worker” Bernie approves of cheers for the hammer and sickle.

tax rate in the OECD?  Congress.  Who wants to make sure that corporations face a higher corporate tax burden than any other place on the planet, and then scratch their heads and wonder why corporations a) aren’t hiring, and b) look to use existing tax law to avoid paying more than they have to?

Congress.  Congress in the form of, specifically, Bernie Sanders, avowed socialist and re-distributor of other peoples’ earnings.

Let’s let Bernie speak for himself, though:

“I have a message for these corporate deserters: You can’t be an American company only when you want corporate welfare from American taxpayers or you want lucrative contracts from the federal government. If you want the advantages of being an American company then you can’t run away from America to avoid paying taxes.”

First, I have a message for Bernie:  Your august body, the Senate, approves corporate “welfare”, in whatever form it takes.  If  you don’t want corporations seeking breaks from the people who write the laws, stop writing laws that do exactly that.  Stop sending former Congressmen to work for lobbying firms.  Oh, and Bernie has no problem signing bills that subsidize, corporate-welfare-style, certain industries that are prevalent in Vermont.  So that form of welfare is OK, but others are not?  And do we need Senators creating and approving 5-year plans like a Politboro hack from the 1980’s?

Secondly, the “advantages” of being an American company include the highest tax rate in the OECD.  How is that advantageous to US corporations, exactly, especially when self-congratulating politicians like Sanders villify the companies that actually produce something, and create jobs to produce those goods or services?  A higher tax rate means reduced net income.  Reduced income means slower corporate growth, reduced product development, less hiring – in other words, the taxes that Bernie thinks belongs to him actually represent jobs and growth taken away from the American worker.

And corporations are the ones being unpatriotic?  Bernie wants to make it harder to find a job.  In a recession.  He’s criticizing corporations for responding to the incentives the US government, in its laws and tax code (one of the largest and most complex codes in the OECD) has created.

In other words, if someone sets your house on fire, you get out.  What you don’t normally see is the person who set the match to your house asking the fleeing occupants why they’re leaving their privileged home.  In fact, Bernie’s going to take it one step further, and make sure they are forced to re-enter the burning building.

This is how Bernie gets fish put on his table, too.

This is how Bernie gets fish put on his table, too.

One last thing:

“At least a dozen other major companies are considering abandoning America through a loophole in the tax code known as corporate inversion.  Such inversions allow U.S. companies to move their corporate headquarters overseas by merging with a foreign company in a low-tax country, even though most of their profits and sales occur in America.”

It’s not a loophole; it’s the law.  Kind of like Obamacare.  It’s not a loophole, Bernie, it’s law – the laws that the Senate makes.  Change the US tax code so the rate is on par with other OECD countries – hell, peg it to an average of all of them and you’ll shave off 10 percentage points – and you’ll see the inversion rate drop.  You’ll see unemployment go down.  You’ll see home-buying increase.  Etc.

You will see all those things, results that don’t require Congressional interventions, other than getting the hell out of the way.  Which is why you’ll never, ever, see a career carpetbagger like Bernie Sanders champion or vote for a corporate tax reduction.

Even if it costs Americans jobs.

 

 

The Volatility of Death

The Shumlin administration, months after touting what a great place Vermont is for jobs, has announced that due to declining tax revenues the state is looking at reducing FY15 budgets in all areas by 4%:

  Gov. Peter Shumlin ordered all agencies to draft a plan to trim 4 percent from their just-approved budgets.

I'm shocked, SHOCKED, to learn that the FY15 budget revenues are off.  I'm also shocked to learn that Spock's ears are fake.

I’m shocked, SHOCKED, to learn that the FY15 budget revenues are off. I’m also shocked to learn that Spock’s ears are fake.

  Final spending reductions are expected to total about 2 percent, with some areas of the budget held harmless from cuts.

  On July 24, top economists briefed Shumlin and members of the Emergency Board about a range of indicators leading   them to expect about $31 million less in state tax revenue over the coming year.

  The pace of recovery is not as robust as they had thought at the start of the year.

  On Thursday, the administration released July tax revenues that came in about 1.77 percent under budget.

As Jim Reardon, the state budget director said:

  “It’s always a difficult process,” state budget director Jim Reardon said Friday. “But the fortunate thing is we’re at beginning of the fiscal year so it’s much more feasible to make adjustments.”

Yes, it’s great that it’s in the first month of the new fiscal year – but it also means that the revenue trends that were evident in the FY14 budget, and that his office has years of data on, were not incorporated into the FY15 budget.  Missing your first month’s budget number is not something to celebrate.  It means you missed something entirely, or your assumptions about revenues are problematic.

And why the big miss, from a year over year perspective?  Not enough rich Vermonters are dying fast enough:

General Fund revenues totaled $101.00 million for July 2014, -$1.82 million or -1.77% below the monthly and cumulative budget forecast targets.  Total GF revenues for the month for were -$2.46 million or -2.38% behind the actual results for the prior fiscal year (FY2014), primarily as a result of the volatile Estate Tax finishing the month at $8.77 million less than last year.

The state is cutting services because it can't forecast inheritance tax revenues - because you can't accurately forecast inheritance tax revenues.

The state is cutting services because it can’t forecast inheritance tax revenues – because you can’t accurately forecast inheritance tax revenues.

In other words, last year’s budget bacon was saved by somebody dying, and since Vermont sees fit to levy an estate tax (remember that this tax is on what was left over after your assets and income were taxed when they were earned, in other words, it’s double taxation), there are times and places where the budget holes are not going to be filled.  The state seems to eagerly await the filling of other holes, notably gravesites, so the annual budgets remain unimperiled.

What’s interesting is that even the state’s small budget estimate for revenues in this category is off by almost 100%.  It means that the state’s annual budget, and the jobs of those people who work for the state, is significantly impacted by a tiny, infinitely small percentage of the state’s population.  To put this in perspective, what would the budget cuts look like if a couple of the other revenue categories were off to the same

A budget rescued by bacon.

A budget rescued by bacon.

degree as the Inheritance & Estate revenues are?

Then the budget might be in full-on meltdown just as the fiscal year starts.  Oh, and to keep this in perspective, Shumlin wants to increase spending for single-payer by $2.2 billion.  Based on the recent budget performances, a lot of Vermonters are going to have to die to cover that new expense – I hope they’re up for it.

 

 

 

“Clean” Energy Jobs And The Taxpayers That Pay For Them

The Vermont Department of Public Service (the same entity that served the public by helping to hasten the decommissioning of Vermont Yankee, which means Vermonters will be subject to spot-market pricing for power and increased electricity rates – conveniently timed for after the next gubernatorial election) recently published a study that forecasts 1,800 new jobs in the “clean” energy industry for 2014.  The job forecast is based on a poll commissioned by the DPS.

Two things:

1.  “Clean” energy jobs (as if there is such a thing; every erg of energy created has some kind of cost in terms of its generation, either the burning of fuel, the build of solar panels with its well-known collateral environmental impacts, or habitat impacts of hydro generation, etc) are largely funded by taxes, in the form of grants, subsidies, or contracts issued by local, state, or federal agencies.  These jobs are not spontaneously born in the marketplace.  For the most part, those jobs are created because there is tax money available for revenues.  Ask any company that builds wind turbines or solar panels where their dollars are coming from.

If only personal incomes were so easily renewed.

In other words, those jobs would not exist without tax money.  At best, it’s an economic wash – a transfer payment, not an indicator of economic growth.  It’s just a re-allocation of capital, funded by taxes and borrowing.

2.  The “clean” energy industry is much more mature in other countries where these energy policies have taken root much earlier than here in the states.  So what are some of the longer-term results of those efforts in other countries?

A few examples:

German Wind Turbine Investors Dissolve Operating Company After 13 Years Of Poor Returns, Technical Failures

“The first report, which came from a commission of experts that had been appointed by the German parliament to study the country’s energy laws, recommended Chancellor Angela Merkel’s government on Wednesday to abolish all subsidies for green energy which cost the state some €20 billion per year.

It concluded that the current system, in which green power producers are paid guaranteed, above market prices to put electricity on the grid, is financially unsound and not producing a measurable effect on innovation. “For both these reasons, there is no justification for a continuation of the [policy],” it said.”

Germany’s Energiewende bodes ill for the country’s European leadership

“The result is a web of grotesque distortions. On sunny days Germany pushes its excess power into the European grid at a loss. Because producers of renewables are paid a fixed price, their subsidy rises as the spot price of electricity falls. On cloudy days Germany relies ever more on brown coal. Last year its CO2 emissions rose.”

French body blames renewables for EU power market failures

“Europe’s electricity system is not living up to its promises, according to a French advisory body to the prime minister, which published a report on Tuesday (28 January) largely blaming renewable energy subsidies for this failure.”

“Whether on low-carbon growth or boosting competitiveness with lower prices – none of the benefits of a common EU electric policy have materialised, the report says.”

Given the examples set by other countries who adopted a “clean energy or die” policy, rushing headlong into the subsidy industry, er, “clean” energy industry,

Well, that right there is your problem.

Well, that right there is your problem.

might Vermont want to take a look at those efforts before committing to having “90 percent of our energy from renewable sources by 2050″, as Christopher Recchia, the commissioner for the DPS, states?  (Hell, why not 100%?  No one likes a quitter, Chris – you’re either in or you’re out.)

But the DPS report’s research methodologies were sampling, in large part, the industries that are direct recipients of some kind of subsidized dollar of one kind or another.  The report itself says that its survey population (10,000 phone calls and 1,200 emails, with a response of 1,464) consisted of “a list of businesses that were identified by Renewable Energy Vermont, various state agencies, and other advisory team members (the “known universe”).”

Well.  If you limit your universe to those entities – private, public, and advocacy – that have an enormous self-interest in the propagation of subsidies, do you really expect to get results back from the survey that paint a bleak outlook for “clean” energy jobs in the future?  The responses to these inquiries are all going to be positive, because if you paint a negative picture, the likelihood of additional subsidy funding diminishes.  It is a self-serving survey.  Given the membership of Renewable Energy Vermont, companies that have an interest in promoting renewable energy and seeking more revenues, it’s like conducting a survey about capital punishment by asking death row inmates their opinions on the subject.  You’re probably only going to get one answer.

In terms of the state’s job growth outlook, I’m not sure if the DPS has talked with the Vermont Department of Labor’s employment projections, but I’m having a hard time correlating 1,800 new jobs with both the occupations and the number of new jobs that the Department of Labor projects for 2015.  Granted, these are two different years, but I would assume DPS does not expect 1,800 new jobs in 2014 to disappear in 2015.

The reason Vermont is rushing forward with clean energy mandates while simultaneously wearing a blindfold is because it’s politically useful to do so.  Peter Shumlin has long backed these subsidy regimes, and even with high-profile, epic failures like Solyndra, no planet-sized levels of reality need slow down a political agenda, one that both brings tax revenues (in the form of subsidies) to energy industry companies, and also allows a politician to claim he or she is actually doing something.  Once again, the only thing being done is political advancement on the taxpayer’s dime, and there will be no net benefit to Vermonters.

In fact, if countries like France and Germany are running away from energy subsidies as fast as they can, all of our policies and budgets that are devoted to emulating those failed models should immediately be halted and put up for legislative review.  Sadly, given Vermont’s politics, that’s about as likely an occurrence as a new nuclear power plant licensing.

 

 

 

Peter Shumlin’s Growing Economic Legacy

The Vermont Department of Labor periodically publishes short-term employment projections, to highlight where the employment growth sectors are likely to be in Vermont, and includes an industry breakdown as well.  Since Peter Shumlin likes to tout economic data as evidence that Vermont is a “great” place for jobs, let’s let his words do the talking:

“With the second lowest unemployment rate in the country, we need to make sure people know that we have great jobs in Vermont – and lots of them,” the Governor said at a news conference at the Keurig Green Mountain, Inc. Beverage Technology Center in Waterbury.

Well.  Peter happily ignores the raft of other information at his fingertips regarding Vermont’s employment outlook, because it might demonstrate a certain lack of greatness for Vermonters seeking to work and live here.

What jobs will have the most openings, based on the Dept. of Labor’s statistics?  Rankings are based on the total number of expected openings in 2015:

Peter's Economic Growth Legacy

Peter’s Economic Growth Legacy

Cashiers.  Retail.  Fast food.  Waiters and Waitresses.  The only occupation in the top ten that requires a college degree is #6, Registered Nurses, which means we have population growth in hospitals, not economic growth.  Personal care aides is growing because of Vermont’s demographics, which features not a youthful and vibrant dominant cohort, buying homes and starting families, but rather the largest growth sector is in retirees – a fact that also helps keep our workforce participation rate low, which has the political benefit of making the unemployment rate artificially low.

Shumlin can tour the state and tell reporters that Vermont’s a great place to work, but that’s so unabashedly untrue as to barely pass the laugh test.  Vermont’s native college-educated graduates leave the state at record levels.  Why?  Take a look at the list of projected occupational growth rates in the chart above and you’ll understand why.  Peter understands that too, which is why he never gets into specifics, other than to tout the one or two companies that are doing well, and have a public presence.  But even companies like Keurig/Green Mountain aren’t growing their footprint here, and in fact their next plant will be built in Georgia – the state, not the Vermont town – as that company expands into cold beverages.

As Peter said, “we have great jobs in Vermont – and lots of them”.  Really?  How’s the 11-30 ranking looking?

11-30 on the "great" list.

11-30 on the “great” list.

The reality is that the state’s largest private-sector industry is tourism, followed closely by retail, and neither industry is known for high-paying jobs.  What does not dominate the job scene are manufacturing, technical, financial, or other traditionally higher-paying occupations.    If you leave Chittenden County, the job conditions just get worse.  Compare the income and population growth numbers between Chittenden County and Rutland County, or the fact that Rutland County has 50% more residents over the age of 65 than Chittenden County does (as just one example) and the picture that emerges is not one of a vibrant and growing Vermont economy.  It is quite the opposite, but these numbers are not the things you’ll hear spoken into a microphone when Shumlin is in public.

Oh, and the BEA ranks Vermont 50th for Total Personal Income.  Dead.  Last.  Even with a 33% increase in personal current transfer payments from 2003 to 2013 (which includes “Government payments to individuals includes retirement and disability insurance benefits, medical benefits (mainly Medicare and Medicaid), income maintenance benefits, unemployment insurance compensation, veterans benefits, and Federal education and training assistance.”) .  Which means we have the fewest dollars, nationally, in income.

Peter's fine work on display here.

Peter’s fine work on display here.

In other words, Shumlin’s legacy is of decreasing opportunity, reduced incomes, and demographic and economic trendlines all heading in the wrong direction.  This is what he’s going to hang his hat on when he runs for a vacant US Senate seat.  The more Vermonters realize what Shumlin’s really been responsible for, the more likely their economic opportunity improves – but until that time, we will be on the receiving end of more of the same.

 

The Trifecta of Incompetence

The Progressive Party Operating Manual

The Progressive Party Operating Manual

Swing and a Miss

The Burlington Free Press, despite its historical track record in defending Burlington Telecom, has just acknowledged what most Vermonters (and especially Burlingtonians) already knew:  BT was at best an enormous financial risk at conception, and that taxpayers are the ones left with cleaning up this mess left by the Kiss administration, and particularly the actions of Jonathan Leopold while he was Chief Administrative Officer for the city.

Still, there are those who defend the city’s foray into providing services that were already being provided by the private sector, because, magically, the good intentions of Progressive politics would ensure blowback-free outcomes. To wit:

Laren-Glenn Davitian, representing various public-access media groups, in testimony filed with the PSB raised another possible consequence of Burlington Telecom going private.

Davitian fears, as the Free Press reported, “a corporate owner would be less likely to attend to the needs of nonprofit media outlet than a public owned utility.”

I guess the needs of the for-profit world, and more importantly, the actual consumers of digital media are to go unmentioned here. Instead, we get the paean for “nonprofit media outlet(s)”, which, one assumes, is a critical media requirement for every Burlingtonian to receive.  For anyone who’s watched cable access, I don’t think anything more need be said.  If this is the best argument for defending the misappropriation of taxpayer dollars – regardless of the get out of jail free card issued by a judge – then virtually any spending by any public entity is not only above scrutiny or criticism, but is essentially unassailable.

In other words, under the guise of public interest, you cannot question the emperor’s decisions – period. Until, of course, you discover that the public’s interest isn’t being served when the organization the political class has willed into being is failing massively, and to fix it, you take their earned dollars out of a cash “pool”, and decide that neither the Mayor, the City Council, nor the taxpayer needs to know about it.  After all, it’s not their money anymore, is it?  It’s the city’s.  Oh, and a Certificate of Public Good?  That’s just not germane to making sure the progressive experimenting in telecoms succeeds.  Why do you need to bother with regulations when you can just go around them?

And why is Davitian is concerned about a nonprofit media outlet? If there’s so much concern, go right ahead and build one your own – and if you build it, they will come, if enough Burlingtonians decide they want to pay for it.  That’s how a market works.  It can also be noted that one of the reasons Burlington Telecom has failed is because their pricing structure was no cheaper than private-sector offerings, and in some cases, was more

...and the idea that someone else is responsible for paying for you.

…and the idea that someone else is responsible for paying for you.

expensive that already-available offerings.

But that’s progressivism in a nutshell: Higher costs, worse service, and it’s always publicly-funded – these three outcomes form the inevitable underpinnings of incompetence. Which means that other such efforts, like single-payer health care, should turn out just perfectly. After all, there’s a long-standing track record of progressive success to stand on.  What’s disappointing is that the Free Press has taken years to come to the same conclusion, and only well after the obvious became indisputably true.

 

 

Putting The Health Care Cart Before The Horse Is Even Born

Shumlin's plan in a nutshell

Shumlin’s plan in a nutshell

There’s nothing quite like being late to the party.  Democrats in the legislature are now calling for a “full understanding” of who pays for health care costs.  This is three years after Act 48 was passed, which mandates a transition to single-payer.  Whew.  Just in time.

“Before entertaining any transition to a new health care system, we need to have a full understanding of who pays today, and how well the system is working today.” Lincoln Rep. Mike Fisher, chairman of the House Health Care Committee.

So now, Democrats are finally getting around to learning the funding mechanisms for the industry they voted to completely overhaul, with the goal of removing all the payers in the system and transforming them into one?  This is like like trying to learn how space shuttle engines work 10 minutes before liftoff:  “Well, we’re pretty sure it’ll work – fingers crossed!”.  Out here in the real world, you can’t buy a house or a car if you can’t afford it, which means someone does an analysis of revenues and expenses prior to execution.

The two words missing in Fisher’s statement are “due” and “diligence”, which, much like the federal health care law, were completely and utterly absent in 2011 when Democrats decided they knew better than anybody else how to manage the largest component of state GDP, while simultaneously putting its implementation off to a much more politically convenient date.  Not only have Democrats now admitted they don’t understand the funding mechanism that they voted to completely remake (even though that data is readily available in dozens of different reports, and has been for years – here’s one from 2009), they still don’t have a financing plan for it, a plan that is estimated will exceed the state’s entire annual tax revenue take.  The FY2015 budget estimates $1.438 billion in revenue; the estimated cost for Vermont’s single-payer ranges from $1.8 billion and $2.6 billion.

In fact, the financing plan is so far back in its prototype stages the state of Vermont is only now receiving bids on an RFP to evaluate financing plans for single-payer.  More money spent to see if we can even afford to do the thing which we’re now going to do.

But let’s get back to the legislators’ plans, plans which seem to duplicate existing work that taxpayers have already paid for:

The work that will be done by consultants for the Legislature will in some ways be nearly identical to the analysis being performed by consultants for the Shumlin Administration. They’ll try to determine not just how much individuals and businesses pay in the form of insurance premiums, but also the impact of health care related costs on other household expenses, such as property tax bills.

There are elements of the original analysis done by Dr. Hsaio in 2011 that are not available, which is not an accident, since those elements speak to the funding mechanism (or lack of one) directly.  As others have noted,

Not pictured:  The taxpayers paying for the marbles in the first place.

Not pictured: The taxpayers paying for the marbles in the first place.

the original pitch for single-payer was that it would reduce costs, but now its being conceded that the only reduction likely to occur is a reduction in the rate of cost growth – if even that can be achieved.  Shumlin himself has said “If we can’t get costs under control,” he said, “we’ll pick up our marbles and go home.”, a sentiment that some legislators are now realizing might be the only rational option.

That’s not what was sold to Vermonters in 2011 by our elected representatives.  Nor was it assumed that the legislature and the governor, both of whom have taken oaths to faithfully execute their offices, would send us down into a dark tunnel without at least thinking to buy some flashlights before we all went in. What this really means, though, is that Democrats are searching for political cover to help their re-election chances in the next several years, but more specifically, after Vermont’s single-payer system blooms into its full flower.  Then they will be able to point back to this fine work and claim that they did their job – even if it was three years too late.

 

 

 

 

 

 

Shumlin’s “Great Jobs In Vermont” Project: Sure, There’s 3,000 Fewer Jobs Than Last Month, But Still, It’s Great

This is my serious face.  You like it?  It's the one I use when I tell people I'm not going to raise taxes, and then raise them later.  See?  I'm serious.

This is my serious face. You like it? It’s the one I use when I tell people I’m not going to raise taxes, and then raise them later. See? I’m serious.  Check your property tax next fiscal year if you don’t believe my Serious Face.

Putney’s favorite son and occasional Vermont governor Peter Shumlin, when not found doing yeoman’s work in creating a business climate that produces, what’s the word I’m looking for here….oh, that’s right – jobs….recently used taxpayer money again to tout Vermont as being a “great” place for jobs.  In fact, things are so great, he’s announced a campaign to tout the inherent greatness of jobs in Vermont, because apparently the previously-mentioned greatness has been hiding under a rock until Peter stumbled across it, and figured that, hey, why not throw this up on a website and start claiming to be the “jobs” governor?

It’s almost as if Peter has recognized his own greatness in creating Vermont’s inherently great job-creating environment.  In fact, he recently claimed that the state has created thousands of jobs in Vermont:

Shumlin says the state has created 11,000 new jobs since he stepped into office in the midst of the economic recession.

Of course, taking a cue from his dear leader, he throws in the “midst of an economic recession” into his claim, because that’s what heroes do -

The Job-Creating Heroes Of The 21st Century

The Job-Creating Heroes Of The 21st Century

they qualify their results so as to color a better impression.  Courage in gubernatorial leadership positions is such a rare commodity, so even flatlanders can understand the unwavering devotion to Shumlin and his good works.

But, in case Peter bumped his head on something solid, let’s look at the numbers, something done last year when Peter was also making claims about greatness that the actual numbers did not support.  Peter came into office in January, 2011.  The actual change in job numbers is 7,500 (not seasonally adjusted), not 11,000.  Total private sector growth is 4,900, government jobs 2,600.  So out of the total job growth, roughly 33% of it is in the public sector.  How many of the new private sector jobs created are required to fund the 2,600 new public sector jobs?  Greatness is its own reward, it seems, so let’s let Peter speak for himself:

“With the second lowest unemployment rate in the country, we need to make sure people know that we have great jobs in Vermont – and lots of them,” the Governor said at a news conference at the Keurig Green Mountain, Inc. Beverage Technology Center in Waterbury.

Vermont’s unemployment rate is low because we have one of the lowest labor force participation rates in the country, not because there are scads of high-paying jobs lying around, waiting for people to apply for.  In fact, there are 850 fewer people participating in the labor force this year compared to last year, so that’s 850 jobs that don’t need to be counted -which makes the unemployment rate look better than the reality Peter wants it to represent.

More Peter:

“Many people have an affinity for Vermont, whether they completed their degree here or just visited for a long weekend, but they may not be aware of the variety of good companies and plentiful job openings available in Vermont,” Gov. Shumlin said. “We’re going to get the word out that Vermont is not only the best place to live and play, but it’s a great place to work as well. We need both Vermonters looking for job opportunities and those from elsewhere who find  that they love Vermont to know that this is a great place to work, live and raise a family – and we have jobs available.”

Plentiful.  Contrary to what job-seekers will actually tell you, Peter says that there’s a virtual cornucopia of gigs out there, just waiting for the legions of job-hungry Vermonters to snatch ‘em up.  But even the state’s own 2012-2014 job projections show an aggregate job rate increase of .7% – not even one percentage point of job growth, and a touch over 5,000 new jobs.  The top 2 categories for this massive increase in projected jobs?  Cashiers and retail salespersons, or roughly 20% of the 5,000 projected job count.  These are not the high-paying jobs the governor seems to think are going wildly unfilled in Vermont’s job market – are they?  Does Peter know something people who actually work in business

If only Peter's Great Jobs In Vermont program had been available 3 years ago, I'd still have one of those great jobs.  Why did Peter wait so long to make Vermont great?

If only Peter’s Great Jobs In Vermont program had been available 3 years ago, I’d still have one of those great jobs. Why did Peter wait so long to make Vermont great?

don’t know, that Vermont was recently ranked 39th best (or worst?) for business?

But in more recent and relevant news, the month-over-month job numbers tell us that Vermont has lost 3,000 jobs between March and April 2014.  Well, it actually lost 3,200 private sector jobs, but since public sector jobs grew by 200, the net loss is 3,000.  So I guess we should say “Great!” and thank our lucky stars that at least some Vermonters are employed, even if those 200 are employed by the tax revenues generated by the rapidly-dwindling number of Vermonters who still have jobs.

 

 

 

Peter The Giant Killer

Peter Shumlin, eager to leave some trace hints of helping Vermonters in time his upcoming re-election season, is putting some of his prior seed corn to use.  Seed corn in the form of millions squeezed out of Entergy, the company that owns Vermont Yankee, and then using those millions to temporarily drop electricity rates – because he truly cares about the lives of Vermonters.

MONTPELIER – Gov. Peter Shumlin today announced that the Department of Public Service has reached agreement with key parties in the form of a

Chaplain: "Do you solemnly swear to reduce domestically-generated power in Vermont, and to hide the inevitable rate increases for these efforts by extorting funds from the very company you're shutting down?"   Peter: "I do". Chaplain: "You may now assume the soon-to-be-vacant US Senate seat".

Chaplain: “Do you solemnly swear to reduce domestically-generated power in Vermont, and to hide the inevitable rate increases for these efforts by extorting funds from the very company you’re shutting down?”
Peter: “I do”.
Chaplain: “You may now assume the soon-to-be-vacant US Senate seat.  Either one”.

Memorandum of Understanding (MOU) with Green Mountain Power (GMP), IBM and the Associated Industries of Vermont (AIV) on a total rate decrease of nearly 2.46 percent for GMP customers over the next year beginning in October, 2014.

The Public Service Department and key stakeholders agreed to a 1.46 percent rate decrease, with an additional almost 1 percent decrease that resulted from a revenue sharing agreement credit from operations at Vermont Yankee in 2013. The remaining revenue sharing agreement funds will be delivered entirely to customers over the next three years through a credit on their bills.

A key component of the agreement also freezes IBM’s rates at this level for the next three years.

“At a time when other states in our region are seeing double digit increases in power costs, Vermonters are going to see rates go down this year,” Gov. Shumlin said.

Why are those costs going up, Peter? And why are Vermont’s rates going down?

Vermont’s rate is going down because the Shumlin administration actively extorted Entergy, the owner and operator of Vermont Yankee, into putting millions of dollars into the state’s coffers (never mind the hundreds of millions of dollars of personal income and corporate income taxes that resulted from decades of VY operation that allowed electricity costs to be much lower than national averages) that Peter knew he could then use to offset rates during his next election cycle.

And then take credit for lowering electricity rates when he’s the one primarily responsible for chasing out the lowest-cost provider of electricity in the state’s history, while managing to turn the company upside down on its way out so some more of their money falls out of their pockets into Peter’s political hands, which he then lavishes onto the proletariat. A favor for which I suppose we’re all expected to thank him for.

Peter has a long record of attacking the state’s cheapest energy supplier.  Now that that fine work has been completed, he’s now giving Vermonters a chance to thank him for a brief rate reprieve, one that will inevitably disappear shortly after Peter has moved on to bigger and better things.

I’ll thank Peter for his work by doing him the favor of not voting for him again when it’s election season, and Peter’s out hyping up his anti-business, er, pro-business record by touting this rate cut.  Peter’s comments make it sound like he’s championing IBM’s interests here in VT, too – a little icing on the electric cake he’s whipping up for us.  Let’s remember that a then-Senator Shumlin called IBM’s spokesperson John O’Kane a liar in a public forum.  He’s threatened the company with action because he didn’t believe they were sharing all the “numbers” with him.  He’s the same governor who happily announced that the Circ Highway – once a critical infrastructure project in Vermont and for IBM’s continued growth, and is now largely a weed farm – will not be built.

Bazinga!

Bazinga!

Once Vermont Yankee goes off the grid, Vermonters will be forced to pay higher rates for electricity, and be subject to more spot-market pricing for power, since roughly 1/3 of their consistent, reliable, and cheap energy will be gone, helped, in large part, by the same governor who’s touting a temporary rate decrease as a win for Vermonters.  Will Peter be in front of cameras taking credit for the inevitable rate increase?  And will he also be available for comment when other businesses decide that the cost of doing business in Vermont makes their presence in Vermont financially ruinous?

Congratulations, Peter:  Mission Accomplished.

 

 

Bernie Sanders for President

What proud, patriotic American Senator would refuse to sit by idly, when they are, for example, chair of the Committee On Veterans’ Affairs, in order to get to the bottom of the recent Veterans Administration scandal?

We need more heroes like this one.

We need more heroes like this one.

Well, there’s one proud Senator who’s been sitting idly by – Vermont’s own Bernie Sanders.  As news of the deaths and other scandals at the VA have come out (which is not new news, by the way), our self-proclaimed defenders of veterans’ interests counseled, instead of immediate action, that we should “not rush to judgment“:

On C-SPAN that same day, Sanders, chair of the Senate Committee on Veterans’ Affairs, urged calm again, saying, “If we’re going to do our job in a proper and responsible way, we need to get the facts and not rush to judgment. And one of the concerns I have, to be very honest, is there has been a little bit of a rush to judgment.”

I suppose Bernie won’t be scheduling an 8-hour speech on the Senate floor, then, to draw attention to the issues that have occurred under his watch, since he’s been acting in various roles in veterans’ issues for years.  Why the 8-hour outrage over tax rates, but no 8-hour outrage over deaths at the VA, especially when his committee has oversight over that administration?  The Senator’s busy schedule doesn’t allow 8 hours for veterans?  The simple answer is that Sanders is not really interested in doing anything other than grandiose self-promotion and demagoguery, and when the bright lights of reality shine on his “work”, he has been found wanting.  His response to this failure is that he does not want to address it.  Look for Bernie to delay, discuss, push the issue off, and ask for an investigation, until the fire that’s burning brightly right now dies down, and the status quo is restored.

In fact, he’s already switching his tune, to make himself look better.  He’s introducing a VA accountability bill – as if something were wrong with his own committee’s oversight responsibilities.  Too late, Bernie.  You’re

Good luck with that, Bernie.

Good luck with that, Bernie.

accountable.  This happened on your watch.  He’s clearly doing this to recover from his prior statements made just a week before, where he dismissed national concerns over the well-being of its veterans.  Here’s Bernie’s call to action – years too late:

“In recent years, as a result of the wars in Iraq and Afghanistan, 1.5 million more veterans have entered the VA health care system,” Sanders said. “Congress must do everything possible to make certain that the VA has the financial resources and administrative accountability to provide the high-quality health care and timely access to care that our veterans earned and deserve.” 

“Congress must do everything”?  YOU are Congress, Senator – you, and those around you, are entrusted to do the right thing by veterans.  When the reality of your failure comes to light, then you state that “Congress must do everything possible”?  How about “This Senator must do everything possible”?   Or “This Senator has failed to do everything possible?”   Because “everything possible” clearly has not happened, and veterans are dying, they are denied access to care, and are forced to queue up in a government-run health care system that you oversee.  Secret waiting lists happened on your watch.

Meanwhile, the people who fight and die for our country continue to receive the very best care that this government-run health care system can deliver, and Bernie is OK with that.  He actually supports that, through his inaction, until it became no longer possible to do so politically.  He is defending a system that leaves deceased veterans’ bodies in county morgues for over a year, with his words and his actions – until it threatened his political viability. Vermont veterans, active duty servicemen and women, and their families, many have voted for and supported Sanders over the years.

Why would anyone ever support Sanders again, given this latest performance?  Why would anyone support a man who is actively sneering at the horrific results of his own “oversight”, all for his own political gain?  What do the lives and futures of our veterans mean to this Senator, other than as vehicles to help him maintain his political career? Now everyone knows who Sanders really is, if there was ever any doubt.  The last question remains:  Why would anyone vote for him again?

Vermont’s Days Of Future Past

Here - let's conjure up a ridiculous budget, shall we?

Here – let’s conjure up a ridiculous budget, shall we?

The State of Vermont, through its Department of Labor, creates projections of future employment, broken down in many ways but here specifically by industry, as part of its mandate (which includes a lot of other labor-related data, too).  These projections aren’t updated annually, but every few years (the data discussed below is from August 2012), and they’re supposed to provide a look forward to where the state’s economic growth, and corresponding tax revenue growth is going to come from.

The Vermont Long Term Industry Projections data is particularly interesting, especially because it provides a snapshot of the employment numbers by industry (using NAICS categorization) from 1988 and 2010, and projections for 2020 based on historical data – and an average annual growth rate by industry using a “compounded formula” (a formula not described on the site).

But the raw employment numbers are there, and it’s worth noting not just the 2010 numbers and their 2020 projections, but the difference in employment numbers in certain industries from 1988 through 2010, and projected through 2020.

Here’s a sample:

Construction of Buildings:

1988 Employment:  6,833

2010 Employment:  3,507

2020 Employment:  4,731

So the projected growth rate is 3.0% (they’re using a formula different than just job growth percentage), but it’s based off the 2010 numbers, not the 1988 numbers.  Raw numbers which are down in total employment from 1988 by 48%.

Heavy and Civil Engineering Construction

1988 Employment:  2,429

2010 Employment:  1,740

2020 Employment:  1,872

Again, there’s a positive projected growth rate but the 2010 employment in terms of raw numbers is down 28% from 1988.

Specialty Trade Contractors

1988 Employment:  8,317

2010 Employment:  8,301

2020 Employment:  10,143

This sector is almost virtually the same from 1988 to 2010, but the projections for 2020 have it 25% higher than 1988 and 2010 employment levels.  I’m assuming this is based on reasonable growth expectations but the data don’t support that projection, although considering the aging housing stock in Vermont, this would be an opportunity sector.

The Manufacturing sector has a huge reduction from 1988 to 2010, the biggest drop found in the Computer and Electronic Product Mfg sector, which was/is largely IBM, but there were other manufacturers in the 1980’s like GE and Digital.

Manufacturing

1988 Employment:  11,744

2010 Employment:  6,866

2020 Employment:  6,101

It’s not new news, but that sector has been cut in half, and 2020 looks even worse.

Other sectors, like Wholesale and Retail trade, are up or even and projected to go up, but the jobs in these sectors are classically low-paying.  If this is your growth sector, your state is in trouble.

Or it’s by design.  One of the biggest growth sectors is in the Educational and Health Services Sector, specifically Educational Services, which includes public education.

Educational and Health Services Sector

Educational Services (incl. Public Education)

1988 Employment:  24,732

2010 Employment:  37,872

2020 Employment:  38,940

From 1988-2010, that’s a 53% growth rate.  Even as student populations started declining, the state and local employment was grown or maintained.  Even the 2020 projection shows roughly another 1,000 employees.

If Peter won't cut this budget, then I will, Bub.

If Peter won’t cut this budget, then I will, Bub.

What the data tells us is clear.  The state is open for business as long as the business involves the state, and any other businesses left lying in the gutter, left for dead, might get $4.5 million tossed at them.  Or not, if the revenues don’t appear.

But hey, hope springs eternal, in that there might be yet another wealthy Vermonter who miraculously leaves the state with an unanticipated inheritance tax windfall, so the state’s budget can stay in the black.

If we needed more evidence that whatever policies our “leaders” are implementing are not only failing to work, they’ve been

pushing the state in the wrong direction, I’m not sure where else anyone in government would need to look, beyond its own Labor Department data.

In case we needed any additional affirmations that our “leadership” thinks it’s doing a swell job, only in Vermont can a state budget increase of 4.1% be hailed as a victory while the state’s anemic 1.2% GDP growth rate (2012) demonstrates the reality of all that’s wrong in Vermont’s legislative and gubernatorial priorities.

There are pictures in the article of legislators applauding each other.  Applauding.  Note that the biggest elephant in the room, Shumlin’s Single-Payer plan, exists to this day without the legally-mandated funding mechanism for its projected $2.2 billion price tag.  To put that expense in perspective, the just-approved budget is $5.1 billion.

Oh, and the state’s still-ignored unfunded pension liabilities?  It’s still in the billions – and the legislature continues to avoid addressing this critical financial issue to the detriment of those Vermonters that will be forced to address this kicked can at some

You've earned the praise of Costanza.

You’ve earned the praise of Costanza.

point down the road.

Why is anyone in Montpelier applauding?  The applause should only be coming from Vermont’s citizens, when they’re in receipt of a mass resignation of the Legislature and the Governor for its joint abdication of duties, and violations of public oaths.  There’s no justification for celebration here – only a chilling reminder that our body politic does not live in the same Vermont that real Vermonters live in.

 

 

 

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