South Dakota is on top… of the lowest quintile for real state GDP growth in 2014:
Two states—Alaska and Mississippi—posted GDP shrinkage in 2014. We almost joined them, growing our economy only 0.6%. We tied Vermont and Connecticut. Maine, Iowa, Indiana, and New Jersey grew less than we did; Virginia didn’t grow at all.
In announcing the new corporate welfare park in northwest Sioux Falls last week, Governor Dennis Daugaard touted the advantages the project would enjoy:
“Foundation Park has several unique and defining characteristics,” said Gov. Dennis Daugaard. “In addition to the location’s robust infrastructure, including access to two major interstates and rail, the site draws from South Dakota’s largest population base in a nationally-recognized, fast-growing economy. Paired with South Dakota’s unparalleled business climate, Foundation Park gives our state the opportunity to attract larger national and international projects” [Governor’s Office of Economic Development, press release, 2015.06.02].
0.6% is neither fast growing nor worthy of national recognition. It doesn’t even beat Minnesota, which posted an anemic 1.4% growth, below the national average of 2.2%.
Amazing how a provincially self-limiting (sometimes referred to as a “conservative” approach to life) understanding of the global economy colors one’s definition of what a “rapidly expanding; robust economy” might actually be – isn’t it?
Wingnuts salted the mine and have it up for sale.
A quick glance at the map shows the Pacific coast liberal states have a steady GDP growth, these states also have some of highest minimum wages in the union.
How much of an impact does a decent wage play in South Dakota’s pitiful growth?
The less than stellar growth in South Dakota GDP can partly be attributed to the downturn in the agricultural commodities market and the resulting ripple effects across the South Dakota economy. Blaming GDP on the Governor’s policies is shortsighted with agriculture being South Dakota’s biggest industry.
I thought, yesterday, we determined that BANKING was the biggest industry in SD! But, as Roger eludes to, the “bottom” includes some of the reddest of the red states! Coincidence????
When agriculture prices were high here a few years ago and it was raining while the national economy was lousy, our numbers looked fantastic. Now we look bleak. So last week I learned here that banking is our biggest industry. Has that helped? Probably in some ways but it does not make us great.
All states have freeways and rail.
We do not have a business climate, we have a low tax climate. As Stephanies father would say, I would not mind paying income tax when I make money. Dry years in South Dakota are harder than taxes.
If we could advertise Aberdeens great trained tradespeople and pay them ok, you could put in a lot of industry. But we can not have investors lose millions like they did at Aberdeen and keep getting more to invest in this state. Obviously republican leadership can talk better than they can do business. We have to become more than another Wall Drug that made money by advertising rather than producing something.
Roger, we’ll find out how that minimum wage affects GDP in next year’s economic results. Respecting Mr. Sol’s wishes, we’ll make sure the SDDP and not the Governor get the credit for that upswing. ; – )
Other than Joop Bollen and the other pals on the Rounds/Daugaard/Jackley gravy train, Republicans have created no prosperity in South Dakota since Bill Janklow left office. Hang onto this and a lot of evidence and put it together for the next governor election (2018) to chase the dumb bastards out of Pierre. The Republican story in South Dakota is one of abject failure in every category that doesn’t involve paying off pals and racketeering. The 2016 election should see the Democrats filling all seats for the Legislature, Congress and the PUC. The narrative and research is being done on this blog. Then in 2018, stop the GOP coronation for Governor, again with all the evidence you’ve retained in the last couple years.
Republican control for the last 38 years has been a fiscal failure. They have nothing more to sell.
It would appear that the ad campaign “Why Die On Mars When You Can Live in SD” is not working out very well.
Banking may be the biggest industry in South Dakota, but it’s impact on the rest of the economy of the state is minimal, compared to agriculture. Much of the money earned by banking doesn’t circulate in South Dakota. It gets shipped elsewhere. Money earned by a farmer or rancher is mostly redistributed to local business or reinvested within the state. I bet you get five times the benefit from a dollar earned in ag versus a dollar earned in banking.
So Daugard is simply a bald-faced liar, again:
“nationally-recognized, fast-growing economy.”
Hang on, Susan! The above GDP numbers are for 2014; the We’re Not Mars campaign rolled out this April. Patience…. : – )
96,
Was in Aberdeen a few weeks ago and a big Mayflower moving van was in front of Joop’s house. The house is pretty hard to miss on North Main’s historic district and didn’t stick around to check but wondered if pallets of cash were being loaded or pallets or new antiquities were being off loaded. Living the American dream courtesy of………
I know you all would like to think otherwise, but the difference maker is natural resources, not politics. ND, MT, WY all have significant natural resources (oil, minerals, natural gas) that SD does not. You can argue blue vs red but those states’ political landscapes look a lot like ours. Be patient and wait for the Baaken activities to roll south and you will see a bump in SD’s GDP. Our economy, based upon the three legs of tourism, agriculture and banking, makes for a stable, but not growing scenario like we are presently experiencing.
Try again, ‘King’
The Bakken has peaked and Montana is tapped out.
“…the site draws from South Dakota’s largest population base in a nationally-recognized, fast-growing economy.” Daugaard is talking specifically about the Sioux Falls economy not South Dakota.
That said, a look at the text behind the graph confirms Mr Sol’s and The King’s astute observations:
“Agriculture, forestry, fishing, and hunting declined in six of eight BEA regions in 2014. The industry declined in all seven states in the Plains region and subtracted significantly from growth in four states—South Dakota, Iowa, Nebraska, and North Dakota.”
And
“Although mining was not a significant contributor to real GDP growth for the U.S. economy, it did play a key role in several states. This industry was a large contributor in the five fastest growing states—North Dakota, Texas, Wyoming, West Virginia, and Colorado. By contrast, mining continued to decline in Alaska due to lower output on the state’s North Slope.”
Note the West Coast state economies improved not because of high minimum wages but because of “Professional, scientific, and technical services was the largest contributor to U.S. real GDP by state growth in 2014. This industry grew 4.2 percent in 2014 compared with 0.7 percent in 2013 and contributed 0.29 percentage point to U.S. real GDP growth. It was the leading contributor to growth in the New England and Far West regions…”
http://www.bea.gov/newsreleases/regional/gdp_state/gsp_newsrelease.htm
South Dakota needs another sucker town that wants a huge economic development project so we can bring on another EB-5. South Korea is having issues with MERS so they would be counted on to provide the money needed along with China. It is just that I don’t think Daugaard is smart enough to get a criminal gang together to get that job done like Rounds did. To raise the GDP, voters need to recall Rounds from his senate seat then send him back to South Dakota to put the gang back together again. Benda is a goner but from what I read about Michels, he could fit the bill with a not much of a problem. He is already drawing a fat pay check to add to his fat paychecks, so it only makes sense to send him to Seoul to make this thing happen. Now to find the dupes in towns and counties to get suckered on.
Economic growth is not going to happen because of government-business “partnerships” (aka, crony capitalism), whether it’s Republican or Democrat officials that try (and both do try).
There are two primary factors that lead to economic growth – trade and productivity. Trade requires us to have something others want to buy and that we’re able to provide that something at competitive prices. This is where efficiency (productivity) comes in. A recent study suggests that increased productivity results from effective financial/capital foundations, increased educational attainment of workers, and solid R&D (primarily private sector).
SD is weak in the first area as we are not, economically, all that diverse. We have ag commodities and credit cards. The heavy state and federal subsidies to agriculture, coupled with intrusive EPA regulations, lock a lot of our entrepreneurs in and prevent genuine diversification. Reducing both the subsidies and the regulatory burdens would be good, basic approaches to improving trade.
And we are weak in both education and R&D, thus weak in the productivity improvements these support. Where state and local government can act most directly and effectively to address these shortcomings is in the education arena. Improving teacher pay and tying it to teacher accountability are good things to do and they will be helpful. But we also need to address the cultural tendency towards parental non-involvement (except in sports) – we could pay the best salaries to the best teachers, but if parents aren’t involved or the parent-teacher relationship is one of antagonism rather than cooperation it won’t matter.
Office parks, arenas, and temporary tax breaks don’t really do much for economic health. They do, however, make for great photo-ops and help politicians get more votes.
For all the talk of small government and local control South Dakota is driven by public sector employment. Conservation and forestry workers are the state’s most distinctive jobs. Montana, Wyoming and North Dakota rely on the extractive industries while Colorado and New Mexico economies are driven by science.
The Board of Regents just approved a natural resources law enforcement program at SDSU to fill more publicly-funded jobs.
I wish South Dakota had the land area for renewable resources and that we had a school that was driven by science and technology. Maybe then we could combine the two to make the state a leader in clean energy along with the technical jobs that go with it. High paid technical jobs rather than schemes and scams would kick that GDP right in the arse in a upwards direction. Of course, it is much easier to scheme, scam and steal all while smiling for the cameras and cutting ribbons for another empty promise. The three S’s, or as we know them, the Daugaard republican agenda.
I’d love to see the reservations be a source of green educational and industry opportunities. Possibly be a branch of a think tank like the Rocky Mountain Institute to Energy production such as geothermal, solar, wind and battery storage, showcasing new super energy efficient and sustainable ways of home building, sustainable AG and whatever else counter to the destructive ways that are going on elsewhere.
If you apply the economic multiplier factor,
http://www.economicsonline.co.uk/Managing_the_economy/The_multiplier_effect.html
I wonder what sort of economic growth South Dakota would have experienced with the $224,000,000 federal money had we accepted the Medicaid expansion.
http://www.huffingtonpost.com/2014/02/27/states-medicaid-expansion_n_4867252.html
There seems to be more to the state’s sad financial picture than agricultural problems. The worst problem seems to be political blindness and hatred toward our first black President and his signature law attempting to help South Dakotans and others in need.
Donald Pay – et al, Most of the earnings of SD farmers and ranchers is NOT diestricbute3d to local small businesses. Most of it is distributed to BIG MANUFACTURY (John Deere, Case/IH, Caterpillar, and so on) to BIG AG (CHS, Monsanto, etc.), BIG OIL (gotta fuel them machines ya know) and BIG BANKS. Please step into the reality of 21st century Ag – okay?
Mr. kurtz points out when he writes “Conservation and forestry workers are the state’s most distinctive jobs. Montana, Wyoming and North Dakota rely on the extractive industries” that South Dakota is a state of greenies. And we are getting greener. Too green for some. Those of you who do not live in the Great State of South Dakota should consider how greener we are than you. Greener than most.