The 16% of American counties that voted for Clinton generated 64% of American economic activity in 2015. Trump’s third of the map includes far more tiny boxes; I can slide 49 counties over from Clinton’s side and completely cover all 2,650 of Trump’s counties.
I wrote on first viewing that this split between high-output and low-output counties appears to align with the split between new-economy counties and old-economy counties. Donald Trump doesn’t even understand that divide; his business is wheeling-dealing for land and buildings, not providing goods or services. He doesn’t even know what “the cyber” is, let alone how it has fundamentally reshaped economic activity. He doesn’t grasp the global economy; he wants to throttle it and have us retreat back into some fantasy shell of isolationism that will tank the entire U.S. economy and leave other nations free to trade and innovate and grow, leaving us to become the next Portugal. Trump isn’t promising anything to put his lower-GDP counties in a better situation; he’s just promising to drag the bigger-GDP counties down.
Sharing my concern, the Brookings Institution’s Mark Muro and Sifan Liu write that a Presidential focus on boosting the GDP of those low-output counties is fine, if the Administration can look forward and accept change:
Given the election map we revealed, the Trump administration will likely feel pressure to respond most to the desires and frustrations of the nation’s struggling hinterland, and discount the priorities and needs of the nation’s high-output economic base.
On one hand, more attention to the economic and health challenges of rural and small-city Rustbelt America could be welcome, especially if it focuses on the right things: realism about current economic trends, adjustment to change, improving rural education and skills training, and enhancing linkages to nearby metropolitan centers. However, Trump’s promises to “bring back” the coal economy and “bring back” millions of manufacturing jobs (that now don’t exist thanks to automation) don’t speak wisely to real-world trends in low-output America. They look backwards and speak instead to local frustrations [Mark Muro and Sifan Liu, “Another Clinton-Trump Divide: High-Output America vs Low-Output America,” Brookings Institution, 2016.11.29].
Muro and Liu worry that focusing on economic development in lagging rural areas could leave high-output urban areas on their own in sustaining and building the education, research, and infrastructure that makes them successful. I’ve advocated a similar focus in South Dakota economic development: let our big, rich towns take care of themselves while focusing government intervention in places where the free market isn’t meeting economic needs, like the reservations.
But in a way, we already do that. Last March, WalletHub measured state dependency on the federal government, based on federal funding as a percentage of state revenue, the ratio of federal funding to IRS collections in each state, and the share of federal jobs in each state.
Of the ten states most dependent on federal funding and jobs, only New Mexico went for Clinton, by a margin of eight percentage points. The other nine most Uncle Sam-dependent states all went for Trump by double digits (19 points in Missouri to 42 points in West Virginia). Of the ten states least dependent on federal funding and jobs, nine went for Clinton (though it was close in New Hampshire, Minnesota, and Nevada). Only one of those more self-sufficient states, Kansas, went for Trump, by 21 points.
Real Republicans and Libertarians could read these maps and conclude is not that we need to understand the emotions and fears of the Trump voters but that we need to get them off their couches and off the dole and get them contributing to the new economy instead of dreaming that the Trumpist government will give them the things they used to work for.
Related Reading: Loren Collingwood of the Washington Post tests county data and finds a distinct correlation between Trump votes and loss of manufacturing jobs from 2000 to 2014. However, Collingwood finds a slightly stronger correlation between Trump’s vote share and change in Hispanic population over the same period:
I also found evidence consistent with the “racial threat” hypothesis. As shown by the orange dotted line in the graph, Trump’s vote was higher in counties where the number of Latinos has increased significantly since 2000. This suggests that some voters may have supported Trump as a way of expressing white identity in an increasingly diverse nation [Loren Collingwood, “The County-by-County Data on Trump Voters Shows Why He Won,” Washington Post, 2016.11.19].
Collingwood finds even stronger negative predictors of Trump turnout in percentage of blacks, percentage of Hispanics, and, the strongest, percentage of residents with college degrees.
Trump may have played to economic anxiety, but he played more to uneducated white fright.
The Department of Public Safety has released its 2015 Crash Report. In his cover letter, Governor Daugaard chooses to highlight two statistically insignificant pieces of data:
In each Crash Report, there are positive outcomes to share and evidence of challenges that South Dakotans face when it comes to motor vehicle safety.
The overall numbers of drivers in alcohol-involved fatal crashes is up slightly from last year’s report. In 2015, South Dakota had 41 intoxicated drivers who were involved in fatal motor vehicle crashes, compared to 40 in 2014.
However, the good news is the number of drivers and passengers who died while not wearing seatbelts in 2015 is down seven percent from 2014. While that number is still too high, we are happy to see a reverse in the trend [Governor Dennis Daugaard, 2015 Crash Report, Department of Public Safety, November 2016].
I say statistically insignificant because a change from 41 to 40 out of over 17,000 crashes doesn’t tell us much. The non-seatbelted fatalities figures are even smaller, down from 30 to 28. Neither decline represents a real reversal or a trend; both are statistical noise, possibly explained by one vehicle.
If we want numbers that can inform policy, we need to look at bigger numbers that can’t be explained by one motorist misfortune:
economic loss ($M)
We killed fewer people on our highways last year, but we still had more costly wrecks. Injuries jumped 8.5%; alcohol-related injuries jumped 23.7%. Direct property damage rose 5.1%; economic losses 11.7%. All of those unpleasant increases exceed the 2.6% increase in reported crashes, indicating that, for some reason, we got more buck from each bang.
That snapshot suggests some strange danger cropping up in last year’s driving. (Anyone care to speculate on the impact of raising our Interstate speed limit from 75 to 80? Ah, but the Crash Report says that while Interstates represent a larger percentage of fatal crashes than they do of total crashes, they make up a smaller percentage of injury crashes.)
Comparing 2015 to 1986, we have 64% more registered vehicles traveling 49% more miles (over 93 million miles, the distance to the sun!) but only 30% more crashes, about the same number of fatal crashes, and fewer injuries.
And over just the last decade, alcohol-related fatalities and injuries have declined 15%, while DUI arrests have declined 18% and DUI convictions have dropped 27%. Whatever we’re doing—more checkpoints, more counseling, sobering up culturally—appears to be deterring drunk driving.
What will happen in 2017? The problem of DUI has only gotten worse since the July 2013 DUI killing of our daughter. We call upon the Governor and Legislature to think about the victims and change DUI laws and practices. Make Vehicular Homicide “a crime of violence”. Implement all the 2013 NTSB recommendations. Mandate 24/7 or ignition interlocks for all DUI convicts. Suspend licenses and impound vehicles upon arrest. Fund local governments that bear the brunt of DUI costs. Stop suspended imposition, allowing offenders to escape any consequences. Stop pandering to defense lawyers. Politicians should heed Psalm 37:27 “Turn from evil and do good; then you will dwell in the land forever.” If politicians choose to fail DUI victims again, perhaps an Initiated Measure can change things [Gregg Spindler, letter to the editor, received 2016.11.29].
I’d suggest the initiative threat may take the pressure off the Legislature to do anything. I’d also suggest that the success this year of Amendment S, the crime victims bill of rights, shows that a DUI reform would pass easily: run just one ad, with Gregg Spindler holding a photo of his daughter, and voters will mark Yes overwhelmingly.
Our World in Data offers a useful series of charts on global trends in financing healthcare. Among theit data, authors Esteban Ortiz-Ospina and Max Roser offer one chart that shows that, since enactment of the Affordable Care Act, the percentage of Americans without health insurance has dropped to a 53-year historic low:
The Affordable Care Act has not changed our status as a stunning outlier in annual per-capita health expenditure and life expectancy:
These spending figures, adjusted for inflation and regional purchasing power, show that we Americans more than twice as much on health care each year as the average in the next 24 biggest health-spending countries and still die 2.8 years sooner than the average in those countries.
We spend more and live less. Wow.
For another perspective, throw the most recent OECD health spending data and WHO life expectancy data together and divide:
Life expectancy (LE)
Health Spending per capita
Years of LE per $1000
$ per year of LE
Out of 43 nations, we are the only one getting less than ten years of life expectancy out of every $1,000 we spend annually on health care. Or, flip numerator and denominator, and we are the only nation out of this big group that spends more than $100 annually on health care for each year of life that we can expect to enjoy.
Or here’s a kicker: multiply life expectancy by annual health care spending: at current rates, each American spends over $712,000 on health care to make it just about 79 years. The Swiss spend $562K and get four more years to hang out with grandkids. Those darned socialist Canadians spend $368K and live to be almost 82.
NSU and DSU both broke 1% headcount growth: NSU netted 91 new bodies on campus for 2.60% growth, while DSU netted 45 for 1.43% growth. Only BHSU saw headcount shrink, which canceled out the gains at NSU, DSU, and Mines by losing 151 bodies, a 3.44% decline (which I don’t get—do you high school graduates not know how beautiful Spearfish is?).
Interestingly, NSU coupled the highest headcount gain with the largest credit-FTE loss by percentage. NSU lost 41.8 FTEs, a 2.10% decline. DSU was the only FTE gainer, adding 37.8 credit FTEs, a 2.03% gain.
If we divide credit FTEs by headcount, we get a picture of which campuses’ students take more credits:
change (percentage points)
Predictably, the Hardrockers take the most credits per student. The Jackrabbits and the Coyotes have the next highest credit FTE/headcount ratios. Mines, SDSU, and USD are above the systemwide average, suggesting they have a higher proportion of students taking a full load of classes. Among our smaller universities, the Yellow Jackets appear to take a few more credits than their Trojan and Wolf counterparts.
This year’s slight systemwide changes fit a six-year flatline:
These twenty-year charts show the clear recession era enrollment surges, plus up-blips in 1998 and 2005. Otherwise, the Regental system doesn’t post monumental growth or declines in enrollment and credit FTEs. Given that the Regents’ goal is ever-growing enrollment, we appear to need a strategy that doesn’t wait for economic distress to swell our collegiate ranks.
The man purportedly sending the letter (and the fundraising pitch, and the four postcards he wants you to send to friends to exhort them to oppose “forced unionism”) is a Washington Beltway lobbyist with Koch Brother connections:
The core statistical claim of Mix’s missive, repeated on the cards recipients can stamp send to friends (Hi, Grandma! Kids are great, but unions stink!) is that “private sector employment jumped over 11% in the last decade in South Dakota—twice as much as forced-unionism states.” Mix is, of course, asserting that correlation equals causation. According to the August 23, 2016, State Economic Snapshots from the Congressional Joint Economic Committee, since December 2007, before the recession, South Dakota’s private-sector employment has grown 7.7%, compared to a national average of 5.4%. Using Mix’s NRTW list of “right to work” versus “forced unionism” states and including District of Columbia, the 26 “right to work” states saw private sector job growth of 6.05%, while the 24 other states plus D.C. saw 5.25% job growth. The actual statistical correlation between private-sector job growth rates and “right to work” status is 0.0004—practically nil. Mix can’t cite a rigorous statistical correlation, let alone the causation that his postcard text implies.
One possible reason for South Dakota’s low wages and nationwide, wage stagnation over the past generation: declining union membership. Marketplace visits with Washington University professor Jake Rosenfeld, who says non-union workers are suffering right along with union workers from the loss of labor’s power to negotiate better pay:
Rosenfeld looked at non-union wage growth since 1979. He said union decline has had a staggering effect on non-union workers.
“We’re talking about over $100 billion a year in lost wages,” he said.
But how do non-union workers benefit from union power?
Nonunion workers benefit from a strong union presence in their labor market in many ways. Strong unions set pay and benefits standards that nonunion employers follow. Those employers may raise pay for some workers to forestall an organizing drive, which leads to an upward adjustment in wages of workers above them, to maintain relative pay differentials (similar to the effects of minimum-wage increases).
Even absent organizing activities in their spheres, nonunion employers may also follow the standards that unions help establish through politicking for labor-friendly policies, instituting informal and formal rules governing labor conditions, and generally serving as a cultural force arguing for a “fairer share” for working men and women. (For example, highly unionized states helped lift minimum wages above the levels of states where labor was comparatively weak.) Higher pay in organized establishments increases competition for labor so that nonunion firms lift wages to prevent their employees from leaving for higher, union wages. And in setting wages, new market entrants often look to what industry leaders are doing; when organized labor was strong, many of these leaders were unionized [Jake Rosenfeld, Patrick Denice, and Jennifer Laird, “Union Decline Lowers Wages of Nonunion Workers,” Economic Policy Institute, 2016.08.30].
5.9% of South Dakota’s workers belong to unions, the 14th-lowest union membership rate in the U.S. As I noted earlier this morning, our average wage is the third-lowest in the nation. Of the ten states with the highest union membership rates (ranging from 14.8% in Oregon to 24.7% in New York), six are among the top ten for average wages. (The statistical correlation between union membership and average wage by state is 0.4633, with a strongly significant p-value <0.001.)
Strengthen unions, and you’ll strengthen wages for organized and non-organized workers alike. Strengthen wages, and you’ll strengthen the economy.
I return to the South Dakota Board of Regents Occupational Wages Dashboard and find South Dakota doesn’t pay the worst wages in the nation. In general, workers in Arkansas and Mississippi get paid even less:
Our neighboring states offer wage advantages ranging from 5% in Montana to 28% in Minnesota. The national average salary is 24% higher than South Dakota’s.
Additional purchasing power from working here instead of SD
The purchasing power of the state average pay after state and local taxes is 8% higher in Montana and 28% higher in Minnesota. The purchasing power of the national average pay after state and local taxes is 25% better than South Dakota’s.
Who’s beating us? The strongest economies are Massachusetts, Oregon, Delaware, Colorado, and California:
Governing explains its methodology:
To determine which states are doing well and which aren’t, we looked at six variables from the Bureau of Labor Statistics and the Bureau of Economic Analysis: the current state unemployment rate; the improvement in the state unemployment rate over the past year; the per capita state GDP in 2015; the percent change in real state GDP between 2014 and 2015; the percent change in state personal income per capita, from the third quarter of 2015 to the first quarter of 2016; and the percentage growth in year-to-date increases in jobs for 2016.
…For each of the six variables, we ranked the states from 1 to 50, with 1 being the best score for that variable and 50 the worst score. Once we had the 1 through 50 rankings for all six variables, we added up each state’s ranking, double-weighting two of the six measures — current unemployment and percent change in real GDP — that we considered the most important. After adding up each state’s rankings, including the double-weighted ones, we divided by eight to create an overall average ranking for each state. A rank of 1 in each category would produce an average rating of 1.0, while a rank of 50 would produce an average of 50.0. In reality, no state was perfectly strong or perfectly weak. All states had a mix of rankings, with the rankings for some variables higher than others, so the states’ average rankings ranged between 13.3 and 40.6 rather than 1 to 50 [Louis Jacobson, “The Best of Times, the Worst of Times: A Ranking of State Economies,” Governing, 2016.08.22].
The top half of states by economic rank each have average of 12.56 Electoral College votes. The bottom half average 8.84 Electoral votes. If Trump’s strength increases with economic disappointment and if voters in each state thus voted by their relative economic satisfaction, Trump would have to win the thirty lowest-ranking states on this chart to reach 270 Electoral votes. Reversing that thinking, Clinton would only need to win the top 22.
The top half includes 16 states that went for Obama in 2012 and 9 that went for Romney. In the bottom half, Romney states outnumber Obama states 15 to 10. States with the good sense to vote for Obama seem to be a little better at building strong economies
Add this article to your Huether 2018 folder: WalletHub says Sioux Falls is the ninth-best-run city in the United States. Looking at our 150 largest cities, WalletHub finds Sioux Falls getting good bang for the buck on financial stability, education, health, safety, economy, infrastructure, and pollution.
Those methodology categories show the problem with citing these rankings as justification for shouting “Mayor Mike for Governor!” Consider education: WalletHub counts GreatSchools scores and high school graduation rate. Sioux Falls schools, like all public schools in South Dakota, are run by school boards, which hold elections, levy taxes, and set policy separately from city governments. A slacker mayor is hard-pressed to foul a good school district’s graduation rate, and an outstanding mayor is hard-pressed to get a meathead school board to hire good teachers.
Similarly on pollution: WalletHub’s city rankings include water quality, air quality, and greenhouse gas emissions. Environmental regulation in South Dakota comes mostly from the Department of Environment and Natural Resources. If Sioux Falls has dirty water, it’s largely from upstream ag polluters. If Sioux Falls has clean air, its mostly from emissions controls imposed from higher levels.
Whatever validity these city rankings have, Sioux Falls can crow relative to its West River rival. Rapid City ranks 32nd. The Gateway to the Black Hills just misses the top quintile due to a really low score in education… which again, doesn’t really indict Mayor Steve Allender or his predecessor Sam Kooiker but simply points out the challenges the Rapid City Area Schools face in educating a higher-minority (Sioux Falls 86.8% white; Rapid City 80.4% white) and higher-poverty (Sioux Falls: 11.8% in poverty, per capita income $28,120; Rapid City: 15.1% in poverty, per capita income $25,983) population.
As the largest city in the state, with the greatest amount and variety of available jobs, housing, and cultural opportunities in South Dakota, plus relatively easy access to not one but two day-drive metro centers, Sioux Falls could elect an Easter Egg mayor and still likely place in the top quintile of WalletHub’s city-management rankings. Keep an ear out for this survey in pro-Huether propaganda, and be ready to apply grains of salt as appropriate.