Friday, March 16, 2018

Can A Pro-Life Democrat Win In South Dakota? Billie Sutton Wants To Know

     Can a "pro-life" Democrat succeed in South Dakota politics?  We'll find out in November.  Much as the Republican stranglehold on South Dakota state politics has resulted in a state with the calcified political and economic environment that I've often discussed and documented here, the Democratic Party's self-contradictory plan to upend the status quo seems more like a dream than a hope.  Why self-contradictory?  Because the party's "white knight" is Senator Billie Sutton, who will be the Democratic nominee for Governor in the coming election.  Sutton has a great biography and plenty of experience, but his "pro-life" voting record while in the legislature stands in defiance of one of the Democratic Party's articles of faith, that women should have the right to abortions.  The Party's 2016 platform states that "we believe unequivocally that every woman should have access to quality reproductive healthcare services including access to safe and legal abortions."
Howdy, Ma'am
Now About That Uterus Of Yours

     Sutton has shown over the years that he rejects that tenet of his party's core beliefs.  In 2013, he voted for a House resolution urging the United States Supreme Court to revisit Roe v. Wade and "overturn its decision."  In 2016 he voted for an "informed consent" law requiring abortion providers to give patients information that South Dakota's chapter of the pro-choice organization NARAL calls "biased counseling."  Cory Heidelberger's Aberdeen-based blog Dakota Free Press has created a table of Sutton's votes that gives the nominee an 80% pro-life voting record during the period 2011-2017.  South Dakota Right To Life was so impressed by Sutton's consistency that in 2016 they rated him 100 and gave him an "A" for his work in support of its agenda.
     Counter-intuitively, these numbers must sit pretty well with South Dakota's establishment Democrats.  Indeed, state party Chairwoman Ann Tornberg has advertised herself as pro-life, though  I've never known her to make reproductive rights an issue in dealing with party business.  Obviously, within party ranks it isn't a make-or-break issue.  There's probably even some sub-surface hope that on the basis of Sutton's pro-life agenda a fair number of Republicans seeking some political reform might feel comfortable voting for him.  That could well materialize, but I think it will come at some significant cost to Democrats in November because most social issues-driven younger voters will be turned off by Sutton's anti-choice agenda.  I haven't found South Dakota-specific numbers, but on a national scale, Pew Research has found that young adults (18-39), by a 2-to-1 margin believe abortion should be legal in all or most cases. The next older group (30-49) agrees by a margin of about 3-to-2.
     If these results are close to how South Dakota's younger voters feel, Sutton probably has a problem. Question is, will this attitude be expressed with enough intensity to make a difference at the polls?  Maybe, maybe not.  My experience tells me that among a fair number of passionately committed young voters, it will be.  I doubt that a large contingent of Dems would reject him outright, but believe that many will respond to him with a collective "meh."  Given the party registration gap between Democrats and Republicans (30% vs. 46%), on the enthusiasm front Sutton needs more, much more.

Monday, March 12, 2018

How Long Can South Dakota Endure Self-Flagellation? Expand Medicaid Already.

     South Dakota's persistent refusal to expand Medicaid is the political equivalent of self-flagellation.  How many "red" states have to successfully take advantage of this good deal before our political class realizes that we're getting left behind on this?  The program itself provides eligibility for Medicaid to state residents who earn too much money to qualify for medicaid under current guidelines but not enough to pay for conventional health insurance. estimates that about 60,000 South Dakotans would qualify under the program, which would be funded by the federal government to the tune of 90%.   That represents some big money, amounting to a bit over $2 billion dollars that our state will leave on the table over the next decade if we continue to reject this great deal.
Works For Montana
Why Not South Dakota?

     Our mostly reddish state neighbor Montana expanded Medicaid in 2016, and economists there are calling it an unqualified success.  Cory Heidelberger's excellent Aberdeen-based blog Dakota Free Press calls my attention to it. Montana analysts conclude that the hundreds of millions of federal dollars that have been sent to the state have, according to University of Montana economists, "added thousands of jobs . . . and significantly boosted the state's economy."  The UM economists further note that the economic boost has been strong enough to "pay for Montana's share of the jointly funded health program."  Putting numbers on it, the university's Bureau of Business and Economic Research says that Medicaid expansion has resulted in "the creation of 5,000 jobs and $280 million in personal income each year."
     How long do we have to wait for South Dakota to seize this opportunity?  I've heard some arguments that we can't depend on the federal government to keep up its part of the bargain, but that contingency can be addressed.  Arizona's ultra-conservative Governor Jan Brewer signed on to expansion in 2013, but with a "circuit breaker" caveat calling for an automatic halt to the program if federal reimbursements decrease.  Virginia, Florida, New Mexico and Ohio have the same option in their programs.
     I've also heard objections to giving benefits to those who won't work for them.  Mike Pence addressed that issue when he was governor of Indiana, requiring beneficiaries to pay premiums into health savings accounts (those delinquent by six months are kicked out) and make co-pays for inappropriate emergency room visits. That skin-in-the-game approach certainly dovetails with the work ethic that is the pride of many South Dakotans. Governor Daugaard himself noted in a RCJ column last June that  "South Dakotans understand the value of work because working hard has been instilled in us by our ancestors."
     Another core element of South Dakota values that we need to incorporate is common sense.  Senator Mike Rounds repeatedly touted "South Dakota Common Sense" as an attribute that he wanted to take to Washington during his Senate campaign in 2012.  So now we should ask, isn't it plain common sense to see the benefits of a deal where South Dakota gets nearly ten times the return on its money, especially when there is a built-in cancellation clause if the feds don't live up to their end of the bargain?  Tens of thousands of hard-working South Dakotans stand to benefit while the overall economy gains something as a result.  It's time to move ahead with this.

Saturday, March 3, 2018

Farmers Are Waiting For The Tariff Repercussions To Take Hold

     After a couple of months of decent rallies in commodity prices, South Dakota's farmers had reason to be optimistic about this year's crops.  Then came President Trump's tariff announcements last week, and suddenly everybody sobered up.  More on that later, but first off, the improvement in crop prices hasn't been about supply/demand fundamentals, which haven't changed much in recent months.  Instead, producers can thank the stunning volatility in the stock market for their good fortune. Analysts are generally saying that institutional investors are pulling substantial cash out of stocks and moving it into commodities.  This is a "lock in your profits" trade, as the big gains since the election of President Donald Trump have given investors plenty of reason to take profits out of historically over-valued equities and put them into real-world products, particularly wheat, corn and soybeans.  This is, after all, the stuff of life.  Even that proto-anticapitalist Vladimir Lenin once said that "grain is the currency of currencies" as he made sure that one of the Red Army's first priorities during the Russian revolution was to steal stockpiles of grain.
Say Goodbye?

    Running for a safe haven during volatile times is a long-standing trading strategy. Given the quirky nature of policies that are coming out of a White House defined by volatility and chaos, it's no surprise to see the gambit coming into play of late. But much as they love the nice upside bounce in prices, farmers saw their markets react with serious concern at the end of last week when Trump's sudden announcement on steel and aluminum tariffs made the news.  Wheat prices in particular got clobbered.  The reason?  Nobody knows how the rest of the world will react.  If Trump's tariffs do indeed get set into motion next week, it's likely that our trading partners will respond with retaliatory tariffs of their own.  Trump seems to welcome that scenario by saying "trade wars are good and easy to win."  Meantime, our farmers, who depend heavily on foreign markets, are out in their fields wondering if retaliatory tariffs will apply to them.  This whole thing is a cloud hanging over the American farm industry.
     With good reason, the Belle Fourche (SD)-based Tri-State Livestock News writes that farm leaders reacted to the tariff news with "fear and horror." TSLN reports that the American Soybean Association and U.S. Wheat Associates jointly stated that "we have repeatedly warned that the risks of retaliation . . . set by such a policy have serious potential consequences for agriculture."    Wheat prices are particularly sensitive to intense foreign competition and stand to take a shellacking if there's a retaliation from our foreign customers. That explains the huge drop in wheat prices the day after Trump's tariff announcement.
     Most surprising to me is that ag producers are themselves surprised by this turn of events, considering that Donald Trump campaigned consistently on his pledge to put the United States into protectionist mode when it came to foreign trade.  Trump's well known support in the farm belt (he carried South Dakota with 62% of the vote) suggests that voters either weren't listening or simply didn't believe he'd actually pull a stunt like this.  As farmers go out into their fields engaged in their Spring planting activities the next few weeks, they'll be wondering if a world that up to now has been eager to buy their production will soon be saying "no, thanks."

Wednesday, February 28, 2018

Does Marty Jackley Want Businesses To Move Into South Dakota Or Doesn't He?

      Last week's resounding vote of confidence by the South Dakota Chamber of Commerce at its annual Business Day gathering in Pierre only reinforced what I've been sensing all along.
But Will They Love Him Tomorrow?
This state's business community is pretty much solidly behind South Dakota Attorney General Marty Jackley's candidacy for Governor, giving him 60% of its support, compared to an anemic 23% for his chief primary rival Congresswoman Kristi Noem.  The balance went to the Democratic candidate Billie Sutton.  This, of course, is about as unscientific as the straw poll at the South Dakota State Fair last summer that gave Jackley a 58% to 41% margin over Noem, but the numbers are facts that have to give Jackley's campaign plenty of reason to cheer.
     But confident as I am about Jackley's chances, my status as a businessman makes me wonder about the cross-purposes in his campaign.  From the "Hometown Initiative" that Jackley released a few days ago, the candidate says that he wants to give "our young people the opportunities they need to remain in the state" and aggressively recruit "employees from outside the state" in order to "retain South Dakota's best and close the worker shortage."  This is great rhetoric, but I don't get how it squares with Jackley's unequivocal support on a couple of issue that are likely to turn off the very people he's trying to attract.  Jackley's support for gender-exclusive use of school bathrooms probably has plenty of backing from voters here, but promoting a law to that effect in South Dakota would have disastrous consequences for his plan to retain and recruit the best people into our state as a way to bolster and advance our economy.  There are just too many companies and institutions that will have nothing to do with a state that discriminates against its transgender residents.  Look at how quickly North Carolina repealed its ill-conceived anti-transgender bathroom law when the NCAA threatened to take its basketball tourneys away from the state because of it.  Corporate boycotts have become a fact of life for states that codify laws restricting the rights of their LGBT residents, so if Jackley wants to impose his values on bathroom access he runs the risk of costing the state some serious money and opportunities.
     Same goes for Jackley's support for one of the National Rifle Association's pet causes, "constitutional carry," which okays the holding of a handgun, either concealed or openly, without a permit.   Along with my M-16, as a radioman I also toted a .45 during my 13 months as a Marine in Vietnam.  I have good reason to get a little nervous about the idea of just anyone getting a handgun off the shelf without a permit.  That restrictions are by-passable doesn't mean they should be tossed.  I'd be concerned about South Dakota getting a reputation as a shoot-'em-up state now that NRA-boycotts are getting commonplace in the corporate world.
    Jackley's dilemma is a tough one:  if supporting the business community and enhancing economic development are his primary goals, he has to court a national market that can find South Dakota and its codified values all too easy to reject, conspicuously. 

Saturday, February 17, 2018

Kristi Get Your Gun.

     Perversely, the most telling aspect of South Dakota's Republican Congresswoman Kristi Noem's campaign for governor this year is what some of the state's most conservative leaders
Kristi Noem
She Can Still Ride Horse
are saying about outgoing Governor Dennis Daugaard. 
In dissing Daugaard's lack of support for their agendas, Rapid City Representative Lynn DiSanto (whose legislative efforts at loosening the state's gun law restrictions have hit a brick wall when they reached the governor's office) last month told the Brookings (SD) Register that "conservative legislators . . . just have to ride out Governor Daugaard's last remaining year . . . I think that Daugaard has pretty clearly shown his colors." Ed Randazzo of the state's Family Heritage Alliance, which has supported transgender-targeted bathroom legislation that has also failed to get a pass from Daugaard, added that if either Noem or her main primary opponent SD Attorney General Marty Jackley becomes governor "we think that the governor's office will be more receptive to our issues."
     It looks like "gun rights" and "family values" conservatives in South Dakota will be getting wooed aggressively by Noem during the primary campaign.  Her official video sets the tone.  She asserts that she's "pro Second Amendment" and concludes with a fetchingly tongue-in-cheek touch: "I can still ride horse.  I can still shoot a gun.  What else do you need in South Dakota?"  Adorably condescending as it is, the line compresses the essence of her appeal.  She's one of us and we're all nice people who work hard, shoot straight, and love the land, right?  More pointedly useful is Noem's commitment to social values embraced and promoted by South Dakota's Family Heritage Alliance, which calls her "a longtime and faithful supporter" of the organization's Christian conservative agenda.
     Voters who are focused on conventional, secular issues like the economy and government operations won't find much on Noem's website.  Looking for them elsewhere I found a recent interview with KSFY television that revealed both substance and vision.  Actually, she nailed it on one front:  South Dakota's "brain drain."  Noem notes that many of our young people "get through college and leave for higher paying jobs."  Obvious as it is, it's nice to hear a politician acknowledge the fact.  Noem wants to turn that trend around by aggressively courting businesses to come to South Dakota, upgrading our technological infrastructure, melding biotech with our ag sector and expanding county-specific developments in the vast rural sections of  the state.           
     These are themes she needs to push.  Noem's already well-established Christian conservative creds won't be enough to take her over the top.  They certainly didn't help her at the state fair in Sioux Falls last summer, where Noem's main primary opponent Jackley won a straw poll with 57% of the vote to Noem's 41%--unscientific, yes, but an eye-opener just the same.  Kristi Noem would be smart to reach out to secular voters and get their attention by stressing accelerated economic growth.  That "brain drain" issue is one that will hit the mark in a lot of homes in this state.                              

Monday, February 12, 2018

A Small Bump In South Dakota Sales Tax Revenues Does Not An Economic Turnaround Make

     The hopelessly reactive nature of South Dakota's Republican leadership to the news that state sales tax revenues are slightly better than planned (maybe "prayed for" is a better phrase)
Governor Daugaard
Expenses Are Way Up Here
Tax Revenues Are Way Down There
is symptomatic of the budgeting stasis that has characterized state government during Dennis Daugaard's tenure as governor. 
The 1.9% improvement over Daugaard's downwardly revised projections toward the end of last year seems to have provoked a collective sigh of relief in Pierre.  Daugaard greeted the news by saying that last December there was "little hope" that the revenue shortfall could allow for even inflationary increases in funding for education, Medicaid providers, and state workers.  Now Daugaard is telling the Rapid City Journal that there is "certainly hope" but that "time will tell."  Indeed.  Going into his eighth and final year as Governor, Daugaard's wait-and-see posture remains unshaken. Unaddressed is the need for dynamic and pro-active leadership when it comes to finding ways to goose South Dakota's economy to at least the point where we can keep up with the growth rates of our immediately neighboring states, not to mention the U.S. as a whole.  As noted here before, South Dakota's per capita growth through 2016 has fallen far behind the rest of the country during Daugaard's tenure in Pierre.  Complete 2017 data have yet to be released, but considering that SD's personal income growth during Q2 and Q3, 2017 were 44th and dead lastrespectively,in the country, I doubt that we'll see much improvement in our standing when the final numbers for 2017 come out in March.
   Meantime, as to those higher-than-expected sales tax receipts that have ratcheted up the hope level in state government (House Majority Leader Lee Qualm says his mood is "guardedly optimistic), I'd say the news should be an embarrassment to those who see some hope in them.  The South Dakota Department of Revenue discloses that 2017 taxable sales for the state were just 1.05% higher than in 2016.  That would be half the relatively modest 2.1% national inflation rate for the year.  Being guardedly optimistic about revenues that can't even keep pace with inflation is a measure of the impotence of our state's leadership when it comes to moving South Dakota's economy forward.
     Considering that the U.S. Department of Agriculture projects a decline of nearly 7% in U.S. farm profits during 2018, I don't see our ag-dominated state's financial fortunes improving much during this last year of Governor Daugaard's tenure.  USDA's projections expect the lowest farm income since 2006 to materialize this year, which only highlights the failure of South Dakota's leadership to create broader economic opportunities and take advantage of those that already exist.  For example, the irrational rejection of the billions of dollars that would have materialized by expanding Medicaid comes to mind right away.
     There are others, and they're worth exploring.  As we bid adieu to Daugaard, we have a chance to check them out in the context of what his contending field of  replacements have in the way of economic development ideas.  I'll do a 3-part series on just those issues and my take on how Kristi Noem, Marty Jackley and Billie Sutton plan to address them starting next week.

Sunday, February 4, 2018

And Just Like That, The Deficit Explodes: The Saga Of Our Spend And Borrow Republicans

     The phony-baloneyism of the GOP's persistent mantra about the need to contain federal
Rounds, Thune, Noem
See No Debt, Speak No Debt, Hear No Debt
deficits was suddenly exposed last week. 
The stock market nosedived, with the Dow Jones Industrial average falling more than a thousand points (about 4%).  I don't think it was a coincidence that the market sank during a week in which President Trump's State of the Union speech ignored mentioning the budgetTrump had good reason to lay rhetorically low because it turns out that the United States Treasury is going to have to sell nearly twice the bonds that it did last year in order to finance government operations, much of the reason being a shortfall in revenues "due to sweeping tax cuts," according to the widely-followed financial website
   I spent a little over a decade ('78-'89) as a member/floor trader on the Chicago Board Options Exchange, and learned very quickly that rising interest rates are the fastest way to put the brakes on a bull market.  Considering that the United States Treasury is probably the biggest single borrower of money in the world, the need to raise a trillion dollars more than it did last year has already affected interest rates, pushing them higher, and probably will continue to do so for the rest of the year.  It's little wonder that President Trump chose to ignore the subject altogether last week.  The financial markets weren't quite so oblivious, of course, pounding stocks and bonds unmercifully throughout the week.
     Meantime, our GOP reps in Congress have dropped their hypocritical tirades against expanding federal deficits.  Representative Kristi Noem once voted to shut down the entire government as a statement against increasing federal debt.  Senator John Thune on his website has said "our country is on an unsustainable fiscal path."  Senator Mike Rounds in 2016 sounded alarms over federal debt, saying we're in "for a grim future . . . if we don't rein in spending . . . and address our $18 trillion dollar debt."
  So how did these three follow up on their respective crusades against increased federal borrowing?  By completely ignoring the holy grail of Republican dogma against out-of-control budgets and voting enthusiastically for a tax cut that has already sent this year's borrowing requirements skyrocketing.  So tough is the situation that Congress will have to raise the debt ceiling by late March in order to make interest payments on U.S. Treasury notes.  This will present our heretofore debt-averse reps in Washington with the exquisitely uncomfortable prospect of thinking about the unthinkable, i.e., increasing federal red ink.
     Our reps had plenty of advance notice about this.  The Congressional Budget Office itself warned about the tax cut increasing deficits by more than $1 trillion.  But did our congressional delegation care?  Not much.  They made some history-defying supply-side noises about increased economic growth creating more tax revenues, but now that the financial rubber is hitting the fiscal road, the United States Treasury can't depend on that political voodooism to materialize.  It's planning on a boatload of borrowing needs this year.  As that transpires, South Dakotans can plan on higher interest expenses as we compete against our own government for money.

Saturday, January 27, 2018

A Knothead With A Law Degree

     Mark Mickelson, the South Dakota lawyer and state rep from District 13 (think Sioux Falls and surroundings) doesn't think much of non-lawyers trying to amend the South Dakota
The Scourge Of Knotheads
state constitution. 
He thinks they're "knotheads," complaining that he's "sick and tired of reading about some knothead . . . that doesn't have a law degree presupposing he knows constitutional law" using the initiative process to amend our state's constitution.  So what's the "sick and tired" lawmaker doing to change the situation?  Something so blatantly against the American way of doing things that Mickelson's efforts are proof positive that lawyers can be knotheads too.
    Mickelson, in his quest to expunge "knothead-ism" from the electoral process wants the state legislature to fix things to his liking.  How?  By restricting the ability of South Dakota voters to amend their own constitution.  He submitted House Joint Resolution 1007 to the House State Affairs Committee last week.  It's a resolution that leaves it up to our state legislature (by majority votes in each house) to decide on constitutional amendments that can be presented to voters.  The existing initiative process, which lets voters decide on amendment proposals through the petitioning process, would no longer exist.  Only lawmakers, not ordinary citizens, will be permitted to place amendments on the ballot.
    This is not only arrogant and presumptive--it exposes Mickelson's tin ear.  Why?  Because if it clears the legislative and executive hurdles in Pierre, his HJR 1007 will be decided on by voters next November--and only a knothead would think that voters will compliantly agree to a restriction of their own rights at the ballot box.  Consider the dynamics of Initiated Measure 22 and its aftermath:  IM 22, the government-and-finance-reform initiative, passed by a 53% majority in 2016.  It was then emasculated by the legislative and executive branches before it even got its final test in the courts.  So outraged were many South Dakotans that a similar effort (Constitutional Amendment W, which I support) with self-preservation smartly built into it will be on next November's ballot. It has as good, if not a better, chance of passing than IM 22.  Neither of these initiatives would have come into existence if Mickelson's brave new world of restricted ballot access were in place. Both measures express a clear yearning by South Dakota voters to retain control of their constitution.  I doubt that most of our state's voters will look kindly on an attempt to cede that control to the government.
     And if that isn't enough for a thumbs down on this democracy-constricting endeavor, consider the larger U.S. Constitutional issue at play here.  In knothead-digestible terms, it restrains free speech.  In its podcast on Mickelson's efforts, RCJ last October quoted a Common Cause spokesman who said the initiative's chance of passing constitutional muster is between "slim and none."  Mickelson is undeterred, telling RCJ "it's likely to be challenged.  I think we win."
     Whoopee.  Who can relish the thought of the State of South Dakota arguing for its authority to deny state residents the right to initiate amendments to their constitution?  Has Mickelson forgotten that in South Dakota, "Under God, The People Rule?"

Wednesday, January 24, 2018

From the South Dakota Legislature's Department Of Dumb Bills

      There's a way for elected officials in South Dakota to deflect attention away from their utter failure to confront, much less solve, the issues and problems that have been building up during the last few years.   The long-tried and -true method is to push legislation that satisfies emotional needs and biases, grabs media attention, usually gets absolutely nowhere, and fritters away government and taxpayer time and resources.  Along the way some really dumb stuff comes up in Pierre during the annual January-through-March session while long-standing issues get shorted and problems remain unsolved.
     Problems, for example, like the persistent and apparently endemic shortfall in sales tax revenues, low wages, stagnant economic growth and the labor shortage should be consuming our elected officials almost nonstop during the session.   And for some, they do.  Governor Daugaard tried to set the course for substantive legislative activity in his annual addresses this Winter, but it looks like we'll have to endure another season of silliness and irrelvance from too many of our reps in the legislature who have other agendas in mind. Cory Heidelberger's excellent, Aberdeen-based blog Dakota Free Press is a good source for a running recap of bills as they materialize--and some doozies are among them.  Examples:
     Rapid City's District 30 Representative, Republican Tim Goodwin, wants to test legislators for drugs in his House Bill 1133.  A scan of the bill itself confirms that it has no chance of passage
as it doesn't contain anything in the way of methodology, and leaves enforcement nebulously up to
Representative Goodwin
Drug Test 'Em All
the "presiding officer of the house to take appropriate action."  This is supposed to become law?Goodwin and his co-sponsors are trying to make some sort of good-for-the-goose-good-for-the-gander statement about mandatory drug testing, but it's a waste of time.

     Meanwhile, from the other end of the state, Sioux Falls District 13 Representative, Republican Sue Peterson,  wants to throw people in jail for a year and fine them $2 thousand dollars for improperly displaying the South Dakota state seal.  Her House Bill 1102  would punish anybody--inside our outside of government--for displaying the seal in any manner that doesn't conform with it's state-approved appearance.  The bill particularly notes that the words "Under God The People Rule" must be included.  This is
Representative Peterson
Jail Time If You Don't Mention God
blatantly unconstitutional coercion.  Peterson and her co-sponsors know it, but it curries some favor with their religiously-driven constituents, so by gum they're for it.  Another waste of time.
     District 19  (east of Mitchell) Senator Stace Nelson wants to amend the state constitution to change the age and gender make-up of the South Dakota militia, which includes the National Guard and some sort of undefined, unorganized and nonexistent "militia." The plan is to make the ranks all-inclusive, with no upper age or gender limits.   His Senate Joint Resolution No. 2 would fit a state-developed force if one ever came into being, but it would also effectively tell the National Guard what its enlistment standards will be.  Good luck with that. Considering that the median household income in two
Senator Nelson
The SD Militia Needs You
of his district's larger towns, Tyndall and Salem, are well below the state figure (6% below for Salem, a whopping 38% below for Tyndall) Nelson might consider spending more legislative time on improving the economic situation of his constituents
     While Nelson, Peterson and Goodwin are pursuing their pet agendas I'd like to know their ideas for, say, reversing the persistent shortfalls in state sales taxes.  And how they could turn their fixes into legislation.  And what they would do about the labor shortage.  And then there's Medicaid expansion, university tuition, alternative energy development . . . and then, and then, and then.  We're looking for policy and we're getting distractions.

Thursday, January 18, 2018

Howcum South Dakota Isn't Getting A Piece Of This Trump-Ignited Economic Wonderfulness?

     This morning the Dow Jones Industrial Average shot up 300 points, right through the 26,000 line, and momentum looks unstoppable.  The bull fever contagion is spread by the corporate tax cut and boosted by the collective realization that Trump's "trade war"  rhetoric during his campaign and early on in his presidency has softened, if not disappeared altogether.  This morning his Chief of Staff John Kelly even called Trump's bombast on the border wall and immigration "uninformed," politely re-stating the oft-expressed notion in this blog and so many others that the Prez is generally clueless about the reality behind his rhetoric. Given that there's at least one adult in his inner circle, I hope this means that Trump won't be upsetting the status quo and that the forward motion of an economy he inherited from President Obama will continue for a while.  With the boost it just got from the tax bonanza handed to corporate America, things look pretty good for a bit.
Rounds, Thune, Noem
So Where's The Beef?

     Which is why I'm wondering why South Dakota has yet to get a piece of this action.  For one thing, the wellsprings of our state's economy, grain and livestock production, have yet to get a price boost from a marketplace that is showering corporate America with good will and ever-increasing value.  South Dakotans are being left behind.  Grain and livestock prices since Trump's election are at best about even, while  stock averages are up anywhere from 15 to 20 percent.  State sales tax receipts have fallen below expectations, forcing lower take-home pay for South Dakota's employees, who are double-whammied by that news and higher prices created by inflation.   As to the rest of our state's residents, things aren't much better.  During the third quarter of last year, South Dakota's personal income growth was dead last (after being 44th worst the preceding quarter) in the country at a tenth of one percent compared to a national figure 7 times higher.  Our immediate neighbors outpaced us by anywhere from 3 to 7 times more growth.
     South Dakota's three-member congressional delegation, Republicans all, should come out and say something about this.  Congresswoman Kristi Noem and Senators John Thune and Mike Rounds all shared a common theme during their respective campaigns, one heard perpetually in this state from congressional aspirants.  In a nutshell they promised to make sure that South Dakota's priorities would be forcefully represented by their presence in Congress.  That they all support Trump's presidency and belong to the majority Republican party in Congress should have given them even more visibility, stature and power when it comes to representing our state.  Yet here we are, a year after Trump's inauguration, going nowhere fast. While the rest of America celebrates and Wall Street is on an orgiastic rave, South Dakota's economic performance and outlook make us look like wallflowers at best, utterly uninvited at worst.
     Actually, I'm only using the Trump presidency as a starting point because of all the economic hullabaloo attached to its first year.  Going back even further, let's say to the start of this decade, our people in D.C. have been duds when it comes to any improvement in South Dakota's economic fortunes.  The default explanation that grain and livestock prices are to blame doesn't work because during the decade we've had episodes of explosively high, record breaking prices in crop and cattle markets.  Meantime, our GDP per capita has actually declined from 2011 to 2016 (latest number available, though our last-place to nearly-last-place personal income performance in 2017 suggest little improvement is on tap for this year).  The rest of the nation, including our immediate neighbors have fared much better.  If these congressional reps are supposedly pounding their respective tables in Congress and demanding some voice for South Dakota, how come we're getting so far behind the rest of the country? Even more dismayingly,  how come we can't keep up with our surrounding states? 
     I have no doubt that our reps and their p.r. pogues can pull out lists of all the wonderful things they've done for the state.  Unfortunately the net results, economically, don't yield much to be proud about.  South Dakota went 62% for Trump.  When do we get something to show for that kind of support? 

Wednesday, January 10, 2018

Here Come Da Judge: Democrat Tim Bjorkman's Quest For South Dakota's Seat In The House Of Representatives

       Tim Bjorkman  will be the Democratic nominee running for South Dakota's lone congressional seat in November.  His task is Herculean, maybe Quixotic, given the recent history of
Tim Bjorkman
Here Come Da Judge
Republican domination of state politics during the last few election cycles. But the retired circuit court judge seems undaunted.  The Republican registration advantage over Democrats, 46% to 34% in South Dakota, is so wide that calling it an "edge" is an understatement.  No doubt the 20% of voters unaffiliated with either party can be a rich source of of potential support for Bjorkman, but Donald Trump's 62% share of South Dakota voters in 2016 makes a convincing case for the GOP's ability to gobble up a lion's share of unaffiliated voters here.  

     Given that built-in handicap, Bjorkman has already effectively acknowledged that he'll have to run against both Donald Trump and the Republican nominee, either Shantel Krebs or Dusty Johnson.  I say "effectively" because Bjorkman's website (refreshingly loaded with positions on specific issues, unlike the me-saturated, policy-devoid versions of his opponents) contains a long, regularly updated list of his takes on the legislative topics of the day, including healthcare, net neutrality, Muslim registry, taxes and DACA.  Bjorkman's commentaries (with one big exception) don't take aim at his GOP opponents but focus on each issue, underscoring the impression that he's running against Republicanism and its local minions in general.      
     The exception on that list is titled "Shantel Krebs' Muslim Registry."  Bjorkman unequivocally slams Krebs for "appealing to our lowest based fear instincts rather than our highest ideals."  Considering that a resurrection of Bush-era plans for a Muslim registry is a Donald Trump brainstorm that probably has a fair amount of  support among the huge majority of Trump's South Dakota voters, Bjorkman's unqualified condemnation of it is some serious risk-taking.  On other issues Bjorkman similarly doesn't stray far from basic Democratic ideals.  When he can, Bjorkman stakes out positions that also have some conservative, if not Republican (yes, there is a difference), support.  For example, on healthcare, Bjorkman cites the conservative-leaning Forbes magazine, noting that "Forbes has shown that if we enact sensible universal healthcare we will not only save money, we can actually balance our budget."  Note the keyword "universal," a bulwark of Democratic healthcare policy.  Provocative as the concept of universal healthcare can be to Republicans, it doesn't hurt to have Forbes going to bat for you as a teammate.  Bjorkman can push the right buttons.
      On other matters it's buttons be hanged.  He gets really worked up on net neutrality, the principle that internet service providers must give all content the same delivery speed and access, a principle that Bjorkman says our existing GOP congressional delegation "sadly" opposes.  He pledges to support legislation "that will statutorily enforce net neutrality."    You can go to his website to find a longer list of Bjorkman's positions, which are clear, unequivocal--and risky as all get out in this red state of ours.  It'll indeed take a mash-up of Hercules and Don Quixote to accomplish what Bjorkman is trying to do.  So far he seems up to the task.  We'll see.

Tuesday, January 9, 2018

Grain And Livestock Futures All Down This Morning After Trump's Talk To The American Farm Bureau Yesterday.

     Ag futures markets this morning opened with a yawn after President Trump gave his speech to the American Farm Bureau convention in Nashville yesterday.  The trade is indfferent, and with good reason.  It wasn't long before it became clear  that Trump hasn't got much of a clue
Trump Talking Ag
Out Of His Element
about what's going on in farm and ranch country when he promised "I will take the first steps to expand access to broadband internet in rural America so you can compete."  Cripes, when I was trading and brokering cattle and grain (both in physical and futures markets) back in the '90s just about every producer I knew in South Dakota had access to real time news and pricing information via satellite or hardwired internet.  They were in a position to compete with the best of 'em when it came to "price discovery"--the technical term for market prices, both on exchanges or at local elevators and sale barns.  Fact is, after 12 years of trading options and ag futures in Chicago, I re-located to the beautiful Black Hills because the information technology revolution gave me the same access to markets in Rapid City, South Dakota, that I had at the intersection of Jackson and La Salle Streets in the heart of the Chicago Loop's financial district.  

     Trump's promise of better access to information is meaningless when it comes to dealing with the real problems in the farm and ranch belts.  Trump added to this diversion from those problems by crowing about the estate tax.  On this one he outright lied, saying that "most family farms" would be spared "the punishment of the deeply unfair estate tax."  No, most family farms, in fact about 98% of them, per USDA, would not have had to file estate tax returns in 2016.  Where Trump comes up with that "most family farms" bit is incomprehensible, but a lot of people out there continue to buy the fiction.  It remains a talking point that won't die
     Then there's NAFTA.  Trashing the trade deal was one of the pillars of Trump's presidential campaign, but South Dakota ag producers know its importance.  Giving it a few words in his speech yesterday, Trump said he is "working very hard to get a better deal for our country and our farmers."  I doubt that there's a better deal possible, considering North American ag sales by U.S. farmers have grown exponentially as a result of the existing deal.  Last November South Dakota Department of Agriculture sent out a news release saying that since NAFTA's inception, ag exports to Mexico and Canada grew from $9 billion annually to $38 billion last year. South Dakota ships 62% of its foreign ag exports to Mexico and Canada. Trump may be trying to get a "better deal" for American farmers, but the initiative, from an ag producers perspective, looks more like an effort to fix something that isn't broken.  Our ag industry has good reason to be concerned that our NAFTA partners can start seeking their farm goods elsewhere if Trump's revisions or outright abandonment of NAFTA make our products less financially competitive. 
     I couldn't find anywhere in the text of his speech a mention of the most pressing issue in our ag industry--money.  Mainly, ag producers have been seeing a steady drop in their income since 2013, and the widely followed USDA's Farm Futures site is looking for an income dropoff in 2018I've also seen forecasts for slight improvement next year, but nobody's talking about a reversal of the multi-year trend.  Trump's silence on the matter yesterday in Nashville reflects his lack of understanding about how global markets are essential to the health of American farms and ranches.  Exports represent about a 20% share of our ag sales and consistently account for a balance of trade surplus within their category.  Bashing global trade is anathema to farmers and ranchers, and given the steady erosion of farm income in recent years, Trump should be aggressively seeking out foreign markets as a way to prop up sales for Americans. 

Saturday, January 6, 2018

I Flush Out Dusty Johnson, Sort Of. The Candidate For The GOP Nod For Congress Responds To My Column

     I have to give it to Dusty Johnson, who's running for a spot on South Dakota's ballot as the
Hi There
Wanna Hug Me?
GOP candidate for Congress. 
He wasted no time responding to my column about him in the Rapid City Journal last week, the full copy of which is two posts below.  Here's the full text of Johnson's piece, which is featured in today's opinion section in the RCJ:

“Dusty Johnson has all it takes in the photogenics department.”
Well, I’ve never heard that before.
I’m used to being described with different terms, like “policy wonk” or “solutions-focused.” When John Tsitrian’s recent column in the Journal described me as “huggable” and “endearing,” I barely recognized myself.
While I appreciate John’s coverage of my campaign for United States Congress, I did want readers to understand there is more to me than the “optimism” and “boy next door” qualities he described.
We are living in serious times, and South Dakota deserves a member of Congress with the South Dakota values needed to represent our state well. Citizens learned about my views and stances during my six years as a state Public Utilities commissioner. More recently though, I’ve released video position statements and online posts outlining my views on the Second Amendment, federalism, private sector job creation, tax reform, net neutrality, the future of Social Security, sexual harassment and the president’s agenda.
I’ve touched on other issues in interviews conducted by the Rapid City Journal, including the drought, the culture of Washington, D.C., and how we should reform health care. Apparently, John missed all that.
South Dakotans don’t vote based on who is more “photogenic.” I’m grateful for that, because most wouldn’t find me (and my slender frame, thinning hair and glasses) all that attractive.
Instead, most South Dakotans vote for the candidate they feel shares their values, will fight for their interests, and who has vision and passion for improving our nation. If that (and being huggable) is what it takes to do the job, I’m ready to get to work."
     Johnson's claim that I "missed" the fact that he has indeed been talking about issues is so overblown that I decided to check the points he raised in his RCJ, one by one.  I googled Johnson and each topic and came up with this (my comments follow):
     1)  The Second Amendment:  Johnson last October told the Mitchell Daily Republic that he "supports the rights of law abiding citizens to own firearms," but that "he's more concerned with generalized violence throughout society."  He's also "willing to learn more" about bump stocks. (I call this pablum, considering he doesn't mention the most pressing issue of assault weapons.)
     2) Federalism:  Nothing found.  (Dusty?)
     3) Private Sector Job Creation:  Johnson last Fall told the Rapid City Journal that Washington, D.C. makes it harder to create jobs.  (Um, Dusty, have you noticed the job growth numbers and the lowest unemployment rate in nearly two decades lately?  They've been trending favorably for about 10 years now. Where have the federal stumbling blocks been placed?)
    4)  Tax Reform:  Moot now that the big GOP bill has passed. Wouldn't mind hearing his thoughts on the new tax code, though.
     5)  Net Neutrality:  Nothing found.  (Dusty?)
     6)  The Future of Social Security:  Nothing found.  (Dusty?)
     7)  Sexual Harassment:  He recently told WNAX radio that "more is expected of public figures."  (Couldn't download the podcast.  Would love to see the rest of his thoughts in writing.  Dusty?)
     8) The President's Agenda:  Nothing.  (I raised the issue of Trump's hatred of NAFTA and how that might affect South Dakota's largest industry, agriculture, which has benefited "bigly" (to use a Trumpian adverb), but Johnson hasn't said much that I can find.  (Dusty?)
     9) And while we're at it, what are "South Dakota values?"  I hear this phrase a lot from politicians and have never understood them.  The phrase implies a uniformity of belief that doesn't seem plausible to me, considering all the differences of opinion and attitude that I encounter here.  
     Johnson says that he has recently released video statements and online posts outlining his views, but as of January 2 they haven't made it to his campaign website.  Except for the requirements of this commentary, I'm not about to scour the internet looking for his posts on these topics, so, yes, Dusty, I have missed all that, "all that" being not much in the first place.  How about spending a few of your campaign funds on delivering your positions in the general media or at least to your website?  On the other hand, what I did find in your list is pretty thin gruel, so maybe it's best to keep it out of the public eye for as long as possible.  

Thursday, January 4, 2018

Does Shantel Krebs Know She Has Egg All Over Her Face?

     South Dakota Secretary of State Shantel Krebs and her Trump-allegiant campaign to win the GOP nomination for SD's congressional seat in November's election just got a bit of a jolt. 
Kobach & Krebs
Playing Charades
When Krebs last month trotted out Kansas Secretary of State Kris Kobach as a highly visible endorser of her campaign she was essentially embracing the voter fraud delusion that the Trump administration has been pushing since his election in November 2016.  Following through, Trump created a Voter Fraud Commission (co-chaired by Kobach and VP Mike Pence) to follow up on his paranoid claim that the reason he lost the popular vote was that millions of people voted against him illegally.  Per Trump "In addition to winning the Electoral College in a landslide, I won the popular vote if you deduct the millions of people who voted illegally."
     Trump's ludicrous assertion was taken seriously only within his brigade of sycophants and enablers, among whom we can count Krebs.  As to Kobach, I'm neutral.  For all I know he was doing a competent and objective job of managing the commission.  But his highly visible position at the head of it makes him a politically useful commodity by association with President Trump.  Krebs  unabashadly touted herself as being "all in" with Trump last September and made the most of her recent attachment to Kobach, even using it as a major campaign pitch, splattered as it was on her website during the past couple of weeks.
Going For The Bucks
Getting Trump Into The Act

     But as all fantasies eventually do, the "voter fraud" illusion dissolved into reality.  Yesterday Donald Trump himself pulled the plug on the commission, which he set up with no evidence in the first placeKobach's stature was supported by a charade that Shantel Krebs took as reality and foisted on her supporters as donation-worthy.  No doubt  Krebs and many other minions of Trump will continue to claim without evidence that voter fraud to the tune of millions of votes occurred in November, 2016. That's the nature of true believers.  If Shantel Krebs is "all in" with Trump she must endorse his assertions of voter fraud to be valid.  The question before us South Dakotans is whether or not we want somebody who embraces belief without evidence to represent us in Congress.  Ms. Krebs, explain yourself.

Wednesday, January 3, 2018

Will The-Boy-Next-Door Become Our Congressman-Next-Year? Maybe, But Dusty Johnson Can Only Go So Far On Optimism And Huggability

     Dusty Johnson has all it takes in the photogenics department.  The native South Dakotan, who's vying for the Republican nomination for our state's lone seat in the U.S. House of
Dusty Johnson
You Just Want To Hug Him!
Representatives, is a model boy-next-door, as huggable as a Paddington Bear and just as endearing.  Shrewdly building on that "aw shucks" persona, Johnson's  standout claim to qualifying for a place on the November ballot is "I'm an optimist.  That's why I'm running for Congress."
     Disarmingly genuine, Johnson's campaign will go far on telegenics.  As to substance, though, he comes up way short.  In fact, it's just about impossible to pin this guy down on where he stands on some of the big issues he'll be contending with should he make it all the way to Congress.  There's probably a lot of calculation in that politically safe approach, but I doubt it will carry him over the top.  Johnson's website boasts of his accomplishments as an elected Public Utilities Commissioner, though all of those decisions were made by the Commission, not Johnson himself.  Then there's that four year stint as Governor Daugaard's Chief of Staff.  Johnson makes the audacious claim that while serving Daugaard he was "overseeing much of state government."  A Chief of Staff doesn't "oversee" government and I'd be surprised if Dennis Daugaard would cede the role of government oversight to what is effectively an office manager with some advisory roles.  More to the point, considering South Dakota's feeble economic performance during Daugaard's tenure, I wonder if Johnson's close association with the Governor's office is the asset that he believes it to be.
     As to Johnson's stands on issues that matter right now, I don't see much.  His interview in the Rapid City Journal last Summer was dismissive toward the agricultural sector in this state, with Johnson saying that "ranchers and row-crop folks don't need a lot" and that "government's not going to make them whole."  He completely overlooked the importance of international trade to our state's largest industry and how he would deal with the Trump administration's hostility toward NAFTA and other trade agreements that are uniformly supported by all the major ag groups.  On health care, Johnson makes the un-stunning (for a Republican) announcement that he'd "like to have a plan that does even more to empower states." Actually, state-empowerment is already a feature of one of  one of our country's largest (to the tune of a half-trillion bucks) healthcare programs, Medicaid.  Does Johnson know that when Mike Pence was Governor of Indiana he devised an Indiana-specific plan to expand Medicaid into his state?  And that Governor Daugaard did the same here but was stymied by a recalcitrant legislature?  States already have the power that Johnson seeks, and it's funded by federal money.  He should know that.
      Meantime we have major fights on the 2018 horizon whose outcomes will mean much to South Dakotans.  At some point Johnson's positions on things like net neutrality, infrastructure spending, the "wall" and other immigration issues will be flushed out and voters will get a sense of who he is.  We'll then find out if the boy next door is capable of being our Congressman next year.

Tuesday, December 26, 2017

Will Kissing Up To Trump Work For Shantel Krebs?

           South  Dakota Secretary of State Shantel Krebs, looking to win the Republican nod for a place on the ballot, hasn't made much news yet, but as of last August her campaign had
Her Own Woman
Or Just Another Trump-bot?
compiled $230 thousand,  probably a good start toward matching the current seatholder Kristi Noem's first campaign war chest of $1.1 million in 2010.
  Her campaign is still fairly light on specifics but some general impressions make it pretty clear just who Shantel is and the voters she wants to win over.  She made a broad proclamation to the Rapid City Journal last September, telling the paper that when Trump was elected she was "all in," and that her motivating force is that she "wants to help him deliver results."  Her slogan is "Get it done."  I admire that she rejects procrastination, but I also wonder what the "it" is that she's determined to "get done."  If "it" references her complete devotion and dedication to Trump and his policies, I wouldn't give Krebs much consideration as a congressional  representative.  "All in" is inclusive, which sounds to me like she's determined to be a rubber stamp for the administration.  If elected would she have the mettle to assert some independence when White House policies may not be the best for South Dakota?  For example, is she "all in" with Trump's hostility toward NAFTA?  He's on the record as calling it the "worst trade deal" ever approved by the United States, yet the benefits to farm states since the treaty's inception a quarter-century ago are self-evidently positive, as our senior Senator John Thune noted in a radio interview recently.  
     No doubt Krebs has her eyes on the huge margin of victory that Donald Trump got in the 2016 vote in South Dakota and plans to ride some vestigial coattails associated with it.  But given Trump and his administration's general antipathy toward free trade, corn-based ethanol and wind power, my guess is that Krebs will be quick to reconsider the notion that she'd be a surrogate for the White House.  I mean, given what we know about Trump at this stage of his administration, who on earth would go on record as being one of his toadies?  Aberdeen, SD, just lost a 400-job windpower-connected factory because of  Trump's pro-fossil fuel policies. Is Krebs all in with that?  Her website provides a nice bio and the usual platitudes along the lines of making Washington "responsive" to the needs of our state, but doesn't touch on many specifics.  One exception: her hostility toward the Supplemental Nutrition Assistance Program, aka Food Stamps.  Oddly for someone claiming to be a voice for agriculture, she opposes the American Farm Bureau's unqualified support for the program, which someone with her farming background should know has been a boon for the ag industry.  
     Sellable as it will be to many Republicans in South Dakota, Krebs' "I'm all in with Trump" campaign is a risky venture.   Next time up I'll think about whether Dusty Johnson will provide a viable Republican alternative.

Friday, December 15, 2017

Deficits? What Are Those?

      The tax bill working its way into completion in Congress with the unqualified support of South Dakota's congressional delegation continues to look like a venture in legislative
Noem, Rounds, Thune
Deficits?  What Are Those?
First off I keep wondering if this silly notion of filing our tax returns on a postcard has ever made any sense.   Who in their right minds would send personal information--especially Social Security numbers--into the mails on a post card?  Not only does the nonpartisan Tax Policy Center think the idea is ludicrous, the center notes that the equivalent of a one-page postcard already exists.  It's called  Form 1040EZ.  TPC thinks the number of taxpayers who will be able to simplify their returns into a single-page format created by the tax bill will grow to 29 million, a 12% slice of the 240 million returns that are filed each year.  How many of those are likely to use a tax-preparation service is impossible to determine, but Turbotax and Jackson-Hewitt, among other such services, court short-form filers, so they must be a market of some consequence.  Indeed, the IRS estimates that 90% of Americans use tax-prep services, many of them short-formers.  I doubt that number will change much under the new code, simplification or no simplification.  Meantime, 210 million filers will still have to do it the hard way.  Thanks for not much, tax reformers.
     more unnerving embrace of surrealism is the casual manner in which deficit hawks have waved off the specter of increasing federal debt built into this bill.  South Dakota Senators John Thune and Mike Rounds have both called existing deficits "unsustainable," but enthusiastically embrace this bill just the same.  Congress' Joint Committee On Taxation says that the $1.4 trillion in revenues lost by the tax cuts will only be partially offset by $458 billion in revenues gained by its boost to the economy.  That leaves a $1 trillion dollar hole in the federal balance sheet in 10 years.  Thune, Rounds and their equally indifferent counterpart in the House of Representatives, SD Congresswoman Kristi Noem, have built their careers on complaints about federal deficits, yet here they are, cheering on the addition of another trillion bucks to our federal ocean of red ink.  Their collective admiration for the notion that tax cuts will stimulate enough economic growth to pay for the deficit has been pooh-poohed by history so many times that you wonder if our elected reps go catatonic when confronted by this type of analysis.  Moody's Analytics says the economic stimulus argument is baloney, as does the track record of tax-cutting itself.  Reagan, George W. Bush, Kansas Governor Sam Brownback--all have tried this gambit and failed. Sharp increases in debt followed their much-ballyhooed tax cuts.
     Adding to this Salvador Dali-esque dreamscape is the sudden appearance of the flaws in Congresswoman Noem's tale of tax-devastation to her family in 1994 when her father died.  An examination of it last week in USA Today headlines that Noem's "family saga doesn't add up." The piece concludes that the story "does not line up with some very basic tenets of the tax code." The bit about not "adding up" seems appropo.  Not much in this tax bill adds up.