State economist Mark Quasney says Governor Kristi Noem’s willingness to not take coronavirus seriously is a major cause of our increased sales tax collections… but even this Noem flunky has to admit that we wouldn’t be seeing increased sales if the federal coronavirus checks hadn’t provided the stimulus they were designed to provide:
Quasney also credits the federal government for giving South Dakotans money to spend. That money includes individual stimulus checks and unemployment assistance, totaling a combined $877 million so far.
The federal Paycheck Protection Program for employers has sent another $1.6 billion to South Dakota, although Quasney said it’s difficult to evaluate that program, because some employers sent the loans back after determining they couldn’t meet the criteria to have the loans forgiven.
Adding up all the federal assistance to South Dakotans from stimulus checks, unemployment payments and the Paycheck Protection Program, the total is about $2.5 billion. That federal money helped lessen the impact of a severe economic downtown in April.
“It certainly smoothed out that trough through the worst month for us,” Quasney said [Seth Tupper, “Sales Tax Collections Are Higher Compared to Last Year,” SDPB, 2020.06.12].
Once again, freedom is nice, but in times of crisis, government has to grease those free-market wheels.
The DOR state site shows an overall decrease of 1.18% (https://dor.sd.gov/media/o5inr4xb/0520statemjrgrpdiv.pdf
The city by city site shows RC down 11.8% and SF down 14.86% https://dor.sd.gov/media/u0zhig2x/0520municipaltaxbycity.pdf Not sure where SDPB gets its numbers.
Above reflects comparisons by month, not the overall collections for the year. Being in the tourism biz, I’d be more inclined to draw conclusions from the trend beginning in April.
Under Obama, Ted Cruz led a filibuster that caused the US government to crash through the debt ceiling and cost us our AAA credit rating because “too much spending.” Under Trump, who spent at comparable levels in the lengthiest bull market in US history: not a word. The unbelievable hypocrisy of it all.
John T. , don’t you realize that South Dakotans did not drive to Rapid City or Sioux Falls to shop during the worst part of the crisis…they learned to ‘shop at home’. The small towns benefitted from their willingness to look around or maybe do without – and many times pay a bit higher price but they supported their local businesses!! Thank You South Dakotans!
But Mary Jean, even if some shopping shifted away from the big hubs (and Aberdeen saw no such slowdown), John is pointing out that the document he’s looking at still shows an overall decline statewide of 1.18% versus May 2019. The $280K gain in municipal tax due in Aberdeen and the $18K gain in Pierre don’t make up for the $1.717M drop in Sioux Falls along with the drops in our seven other top-ten-pop cities. Madison, a town that ought to benefit from locals’ not venturing out to any of the five adjoining hubs, still saw a drop in muni tax due of 5.65%. Where’s the buy-at-home effect there?
Hey, John: do online sales show up on the muni tax report?
Socialism is what South Dakotans live on!
$2.5 billion is a lot of socialism.
How do we know this young Mr. Quasney fellow is a flunky and not a deep-state plant, sent to bugger up the workings?
South Dakota universities have been the recipients of billions of dollars of federal contracts and research monies over the decades, monies awarded to top notch competitive research faculty in universities around this state. Insofar as the vast majority of these monies are for cutting edge research these resources could have been capitalized on by the state in the form of spin-off patents and the ensuing economic development to the benefit of SD and the nation. But have these federal investments in our state been realized? Very little if any in proportion to the federal funds we’ve received, the token and narrow-sighted economic development offices notwithstanding that have no idea how to spin threads of gold into benefits to the state and nation. South Dakota takes from the feds all it can get but has yet to figure out it’s responsibility to reinvest and multiply what it’s been awarded. This has been going on for decades.
University of Minnesota has a business school department devoted to figuring out a way to turn research into $ for the U and Minnesota and into business startups in Minnesota. That department works directly and closely with other departments I mention below. The more $ from research, the more can be spent on research equipment, leading to bigger research deals, etc.
The U Ag School gets a nice chunk of change from their apple patents. There are medical and tech patents too.
That research and those patents lead to companies coming to Minnesota, investing in Minnesota, or best of all, grads starting businesses in Minnesota.
Rather than trying to lure the cheapest, most exploitative companies to SoDak, they ought to try the Gopher model and create high level businesses right there. Of course that would ruin SoDak’s reputation for treating labor like crap, no benefits and bottom wages, cheat them whenever you can. It would also threaten the SDGOP power structure.