Monday, July 31, 2017

CREG: State's Economy in New Normal

The Consensus Revenue Estimating Group, CREG, has released its report for July. I am planning a longer article about it, placing it in its proper macroeconomic context, but because of this week's Revenue Committee meeting in Thermopolis, I wanted to put up a short note on the report before they get started. (By the way, in case you happen to be in the area, the meeting is Wednesday and Thursday.) So here goes.

The report's leading message is that:

Fifteen Industries In Decline

Last week I reported that the Wyoming economy has the worst GDP growth in the country. In the first quarter of 2017, our state's economy contracted by an inflation-adjusted 3.7 percent over the same quarter in 2016. Regular readers of this blog are not surprised: I have written numerous articles about the poor-to-disastrous performance of our state's economy. 

Equally unsurprising is the report that the Department of Workforce Services released recently, with labor-market numbers for June. It shows that:

Saturday, July 29, 2017

An Open Letter to the Revenue Committee

Chairman Peterson; Chairman Madden; Members of the Joint Revenue Committee of the Wyoming Legislature,

Friday, July 28, 2017

Obamacare Wins: Here Is What's Next

I took my wife to breakfast at Perkins this morning. They have hashbrowns worth starving for.

I also took the opportunity to honor John the Statist, the big government proselytizer from Arizona, whose relentless commitment to egalitarianism has now ruined sensible, meaningful and workable Obamacare reform.

Thursday, July 27, 2017

GDP: Wyoming Growth Worst in Nation

I hear from legislators that my blog is inspiring voters and taxpayers to voice their concerns about our state's future. I also hear that people are being inspired to run for office, thanks in part to my work. Those stories are heart-warming - thank you! - but they also prove that there is only one way for the truth to win: with superior analysis, we will always win the argument; with active voters and taxpayers, nobody can escape our arguments.

Tuesday, July 25, 2017

When Is Government Big Enough?

The welfare statist has a simple answer: never. To him, government is never big enough. In my new book, out in October, I explain in detail why this is so; where the welfare statist ideology comes from, what it has already done to our country and what it will do in the future. (Make sure to be the first to read it - pre-order it today!)

Sadly, the welfare statist ideology - egalitarianism - has conquered so much of America already, that its way of thinking runs deep even in supposedly conservative circles. Therefore, it is not surprising, but troubling of course, that even President Trump falls into statist habitual thinking.

Monday, July 24, 2017

Are the Best Run States Republican?

If Wyoming has proven anything over the past few years, it is that Republicans and fiscal conservatives are by no means overlapping categories. A quick glance at what the Republicans have accomplished in Congress over the past 30 years or so even suggests that the two may be strictly separate.   

Somehow, though, a lot of people still believe that just because someone is a Republican, they are also fiscal conservatives. A report in the Investor's Business Daily on July 11  alluded to just that:

Friday, July 21, 2017

Sorry, Governor Mead, But You Are Wrong

According to the U.S. News and the Associated Press, Governor Mead believes that the state budget situation is not as bad as expected. The state's General Fund, Mead said, "is running above projections by about $70 million." He added that "other revenue" is also exceeding expectations.

I understand the governor. He gets his picture of the Wyoming economy from, among others, state senior economist Jim Robinson. Unfortunately, Robinson's latest analysis of the state economy was nothing short of dishonest. I am sorry to be so blunt and use such a strong word, but I have to call them as I see them. 

Wednesday, July 19, 2017

Uncertainty Holds Economy in Tight Grip

After two years of depression-level decline in economic activity here in Wyoming, we have reached a point of stabilization. This is a "new normal" where, if the economy if left alone by our legislature, we will be for the foreseeable future. (With the right kind of government spending reforms, though, we would see a substantial improvement in the economy.) There are, however, some peculiarities about this "new normal" that throws a veil of uncertainty over it. While we await the new state GDP data (published by the Bureau of Economic Analysis next week), here are some interesting numbers from our state's labor market.*

Let us start with the aggregated private sector of the Wyoming economy.

Monday, July 17, 2017

Wyoming Democrats Invite Taxman O'Malley

Rumor has it the Wyoming Democrats just had a pow-wow in Thermopolis, to which they invited an out-of-state speaker: former Maryland governor and former Democrat presidential candidate Martin O'Malley.

One of their reasons for getting together was that there is apparently a "groundswell" against president Trump. They probably know something I do not, but be that as it may. It is always nice to see that Democrats in Wyoming are still active. A one-party system is never good for anybody in the long run. 

That said, I have to admit that their choice of speaker kind of defeated the very purpose of a two-party system here in Wyoming.

Wyoming Closer to Taxmageddon

On August 2-3 the Joint Revenue Committee is meeting in Thermopolis. Their agenda, which you can read here, is filled to the brim with proposals to raise taxes, and - just to top it off - higher fees. 

So long as their agenda remains the subject of a dinner conversation among welfare-statist friends, it will do no harm to Wyoming. But when the Revenue Committee meets, it is not to have dinner. It is to mark the beginning of a new tax policy for our state. 

As such, their agenda is the very opposite of what our state needs. Let us take a quick walk through it, item by item.

Sunday, July 16, 2017

Dear Congress: Please Grow Up

The United States remains one of a very small number of developed nations that still has not created a single-payer health care system. We should be very happy that we do not have to live under the unending problems that are associated with a government health care monopoly. The problem is that if the Democrats can have it their way one more time, we will get a single-payer system. 

Not only would that decimate our health care system to an archipelago of budget-restrained medical facilities providing mediocre care at phenomenal waiting lists, but it would also create the largest government bureaucracy the world has ever known. Imagine one federal agency with a budget of $2 trillion ($2,000,000,000,000) per year. 

For Wyoming, a single-payer system would mean the disappearance of every full-service hospital outside of Cheyenne, and possibly one more location.

Friday, July 14, 2017

The Mercatus Report: What It Actually Means

On occasion, out-of-state think tanks provide analysis of the Wyoming economy and, in particular, our state's finances. These reports are often misused by welfare statists here in our state. The most recent example is the annual Ranking of the States by Fiscal Condition report from The Mercatus Center at the George Mason University.

The headline for Wyoming in this year's report is that our state ranks 5th in the nation for fiscal solvency. Needless to say, the Wyoming Business Report quickly picked up on this fact, and we can safely expect other news outlets to do the same.

As an outsider's view of our state, the Mercatus report can be likened to the annual tax climate publications from the Tax Foundation.

Wednesday, July 12, 2017

The Kansas Tax Cuts Revisited

Total state government spending in Kansas has essentially tracked that of the nation as a whole. For 2001-2011, in-state sourced spending, which adds together the General and Other Funds, increased by widely varying numbers, reaching 11 percent in 2009. Due to a one-year drastic and anomalous spending cut, the average only reached 4.5 percent, though without that anomalous cut the trend growth was 7.4 percent per year, in current prices. After the reform, General and Other funds spending again exhibited considerable volatility, with a trend growth of 4.7 percent per year when anomalous reductions are removed. The fact that Republicans in Kansas have abandoned their 2012 tax cuts has been used over and over again by welfare statists, nationally as well as here in Wyoming, as a general argument against tax cuts. They conveniently avoid mentioning spending in the same sentence.

The blog Better Wyoming is a good example.

Tuesday, July 11, 2017

How to Respond to A Welfare Statist

In a discussion on a Facebook thread, where I (again) pointed to the excessive size of our state government, a Republican former speaker of the Wyoming State House asked me:
Sven, you propose lots of abstract cuts without being specific. Which teachers, nurses and prison guards do you propose to reduce to make your $1.8 billion in statistical cuts? The devil is always in the details. What are your detailed proposed cuts. Otherwise, it is the old story about the chemist, physicist, and economist talking about a can of beans.
This is the oldest liberal, welfare-statist card in the deck. Every run-of-the-mill leftist from Scandinavia to California knows how to use it as their go-to political emoticon. If I had a dollar for every time someone has thrown it at me...

Monday, July 10, 2017

The Austerity Storm: Wyoming

As I explained in earlier articles, the austerity storm is coming, it is real and it is going to hit state governments hard. For half a century, we have used budget deficits to build a bigger federal government than we can afford, and by funneling some of the borrowed money to states (in the form of federal funds) we have also expanded state governments beyond what taxpayers can pay for. 

Friday, July 7, 2017

New Conservative Institute Article

Here is my latest article with the Conservative Institute, discussing the role of waste and fraud in the federal budget.

Thursday, July 6, 2017

Paid Leave: Trump's Budget Boondoggle

So far, Donald Trump has been a good president for the American economy. He has also been good for Wyoming by halting and starting the rollback of regulations on the minerals industry (though in fairness, Congressman Cheney deserves most of the kudos for that). If only the Congressional Republicans could get their act together and actually give us back some sort of pre-Obamacare free-market based health insurance system - and if they could also cut taxes - we would be in a pretty good shape as a country.

At least for the time being.

See, Trump just could not leave it alone. The welfare state, that is.

Wednesday, July 5, 2017

Federal Overreach: The Real Problem

Some of you blog readers have already expressed your reactions to this story:
Wyoming is joining more than 20 states in refusing to turn over public voter data to a federal commission investigating the integrity of elections. “I’m going to decline to provide any Wyoming voter information,” Secretary of State Ed Murray told the Star-Tribune on Monday. “It’s not sitting well with me.”
I am not going to argue the issue itself, with one exception: as someone who legally came to this country as an immigrant, and who has gone out of his way every day not to do anything illegal, it upsets me that the Wyoming Secretary of State refuses to cooperate with the federal government on such a fundamental issue as election integrity. 

Monday, July 3, 2017

The Austerity Storm: State Budgets Eroding

Nationwide, states and local governments are responsible for about 40 percent of total government spending. In total, federal, state and local government spending add up to a bit less than a third of the total U.S. economy. This share is below the average for developed, industrialized welfare states, but it is still high enough to have notable economic effects.

The worst of those effects do not show up in regular economic analysis, nor are they visible in regular statistics. They do not show up until government is pushed to the brink of fiscal panic.

Sunday, July 2, 2017

New Page: Conservative Institute

In addition to fighting for the future of Wyoming, I have started writing for the Conservative Institute. It is an exciting start-up outfit with lots of potential. I will publish links to all my writings for CI on this dedicated page, here on Wyoming Prosperity.

New Page: Larson's Political Economy

I have decided to move my other blog, Larson's Political Economy, onto this blog. From now on it will run as a separate page under the title Larson's Political Economy. The articles on this page will be more general in character than the ones on the main page, which are all directly or indirectly aimed at contributing to the discussion about the economic future of Wyoming. 

The first piece on Larson's Political Economy is about a really bad idea for a guaranteed basic income. This idea is so bad, in fact, that it would quickly and irreversibly terminate private ownership of most large businesses in America. 

Why discuss it? The idea was penned by an Economics Nobel Prize winner.

Saturday, July 1, 2017

America's Austerity Storm: The Threat Is Real

Wyoming is not the only state with budget problems. Short term, our problems are not the worst, but long term they are at least as bad as the situations other states find themselves in. Like us, they have failed to realize the combination of slow macroeconomic performance and government spending that is designed to grow faster than the state's tax base. 

The similarities between our state and others present us with both a challenge and an opportunity. The challenge lies in learning from their mistakes; the opportunity lies in doing right what they do wrong.