July 09, 2007
Learning From Idaho (and Hawaii, Montana, and Utah)

Lynne Varner of the Seattle Times is convinced that Democratic governor Chris Gregoire is doing a fine job, in part because unemployment in the state is about average for the nation.

For now, revenue predictions are rosy.  According to the state Economic and Revenue Forecast Council, reserves are headed upward of $1 billion.  The economy is fortified by an all-time low unemployment rate of 4.4 percent and job growth that outpaces the nation.

If that's a good performance, how should we grade the performance of the Republican governors of Idaho (Kempthorne, Risch and Otter)?

Want to increase your chances of getting a job?  Move to the wide-open state of Idaho.  Along with Montana, Utah and Hawaii, it is among the states with the very lowest unemployment in the nation, according to the Bureau of Labor Statistics.

Nationwide, the jobless rate is at a comfortably low 4.5 percent.  But in Idaho it is exceptionally low — recently, it came in at 2.3 percent, which had the state's own analysts scratching their heads in amazement.

Do those four states have anything in common?  Well, three out of the four, all except Montana, have Republican governors.  And it may be significant that Hawaii was doing badly economically until Republican Linda Lingle won the governorship in 2002.  (She may have been cheated out of a victory in 1998.)  For more evidence, take a look at the graphic that accompanies that brief New York Times article.  You will see that, in general, states that voted for President Bush in 2004, that is, Republican states, have lower unemployment rates than states that voted for Senator Kerry, that is, Democratic states.

This pattern would not surprise the late Mancur Olson.  In his book, The Rise and Decline of Nations, Olson argued that special interest groups in democracies carve out special deals for themselves and, over time, slow growth and even cause stagnation.  Though Republicans are imperfect, they are better than Democrats at turning down special interest groups, especially unions.  It is no accident that the state with highest unemployment, Michigan, is also a state where unions have been extraordinarily powerful, for many years.

Cross posted at Jim Miller on Politics.

(Regulation is also the most likely reason that Idaho (and other Republican states) have less expensive housing than Washington (and other Democratic states).)

Posted by Jim Miller at July 09, 2007 04:06 PM | Email This
Comments
1. If Lynn thinks it's so zippy out there, perhaps she could pay our family's B&O tax.

Posted by: Michele on July 9, 2007 05:36 PM
2. Washington is a beautiful state -- water, mountains, evergreens, and a temperate climate. Geographically located for massive trade with Asia our economic well-being is almost assured by that stroke of luck alone.

Politically we are in the basement of an outhouse. If our politicians and beurocrats were in, say Montana they would be booted out of office when the economy tanked because of their policies.

Here they are able to piss on the taxpayer and still retain their office because our geographical location ensures a reasonably good economy through trade.

Politically we suck, economically we rock, in spite of the political structure.

Posted by: Dick H on July 9, 2007 05:44 PM
3. Our economy has much more to do with the what Boeing and Airbus CEOs do than what our governor does. I agree with Dick, our economy is doing great despite our governor and I would add it is doing well nationally despite our congress and president.

Posted by: Travis on July 9, 2007 06:07 PM
4. You could put all that Queen Christine knows about business on a Post-It and still have room for your grocery list.

Posted by: Walters on July 9, 2007 06:12 PM
5. You couldn't put all of Queen Christine's Tax and fee raises on a whole case of post it notes.

You wouldn't need any post it notes to list all of the tax cutting promises she has made and kept.

Posted by: GS on July 9, 2007 07:51 PM
6.
You know what? I actually like things they way they are in Washington their present unlivable form, because people really should be moving away from the Puget Sound and into Idaho anyway!

Seriously, anyone with a family would have more house and a better lifestyle in Pocatello than anywhere around here.

Posted by: John Bailo on July 10, 2007 04:28 AM
7. TWO BI-PARTISAN ECONOMIC FACTS

1. Any money spent on subsidizing 'low income' housing only increases demand

2. Inflation and employment are contradictory goals. High employment leads to inflation and low employment reduces it. The prime rate is the tool to manage these effects.

No comments about Gregoire here, no room on the post-it! That's pretty rare for me to pass up an opening on her, isn't it?

Posted by: Douglas Tooley on July 10, 2007 06:06 AM
8. Puget Sound was the best kept secret in the country in the 50's, 60's and 70's. Except for a few Boeing burps, the economy was consistent and diversified (timber/lumber, fishing, aircraft, military, shipbuilding, import/export, tourism). The political scene was moderate during that period, traffic was manageable, housing was affordable and folks enjoyed life in the NW.

All that has changed since our population doubled....

We've caught all the fish, cut all the timber and exported the shipbuilding industry to Korea, leaving Boeing, the seaports, the military and the tourists. Still not too bad...

Traffic is as bad or worse than any city in the country. Bad...

Housing is in short supply, very expensive, with prices still rising...

But the most detrimental change is in the political arena. Seattle and Olympia are a few steps west of Havana. Taxation is out of control, over-regulation is the order of the day, leftist politicians and public-employee unions flaunt their power in the face of the people while perverts and the unclothed proudly march the streets of Seattle.

Soon, this area will be just like other areas of the country that people move away from. Everything that made Puget Sound a desirable and beautiful place to live is eroding and decaying. I sadly watch as the region my family settled in 1898 becomes a sewer.

Posted by: Saltherring on July 10, 2007 07:21 AM
9. Imagine how much better we'd do if all the Socailist-Democrats would get out of the way.

Posted by: John425 on July 10, 2007 10:40 AM
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