Sunday, April 29, 2018

When It Comes To Citizen Input, Jackley Gets It, Noem Doesn't.

     Since when is the creation of volunteer citizen advisory boards an indicator of bigger
Jackley, Noem
Some People Get It, Some Don't
government in South Dakota?  
  As adjuncts, they aren't even part of government, so how could they be making it bigger? This is one of the crazier notions that I've seen in a long while, but it's a core belief of our U.S. Representative  Kristi Noem, who is running for the Republication nomination for Governor.  Her campaign manager Justin Brasell  pooh-poohed the idea of citizen input last weekend in an RCJ piece (written by Bob Mercer) when he said, "she does not believe bigger government is the type of reforms South Dakotans want."  Brasell inexplicably thinks creating advisory commissions will enlarge state government. 
   Noem herself extends the notion.  In the same RCJ piece she says, "under my administration there would be no new boards, no new commissions, and no new blue ribbon task forces."  Wow.  Talk about a cavalier approach to government.  This is a candidate who has no interest in developing and getting input from groupings of interested and knowledgeable private citizens when it comes to decisions made by politicians in Pierre.  The arrogance inherent to this attitude is unseemly and compares unfavorably to the approach taken by her rival for the GOP nomination, Attorney General Marty Jackley.
     Jackley's approach is the exact opposite of Noem's.  When it comes to willingness to reach out and seek some counsel from beyond the perimeters of state government, Marty Jackley isn't so convinced of his own decision-making prowess as to ignore the value of private sector expertise.  He puts it succinctly:  "Government doesn't have all the answers.  That's why as governor, I would make it a priority to work with citizens across South Dakota. . . we will not hesitate to use volunteer commissions or task forces." What Jackley will do, Noem won't.  A contrast can't get much starker.
     As a registered Independent I won't be voting in the Republican primary.  Readers of my blog and column know that I have strong reservations about both candidates. For example, I'm still waiting for Attorney General Jackley to provide us with a timeline and flow chart explaining how all that EB-5 money went poof a few years ago.  As to Noem, I want an explanation of how she went to D.C. as a "Tea Party"-admiring deficit hawk and then entered her last year in Congress by voting for a tax bill that will add $1.9 trillion to the national debt, a figure computed by the Congressional Budget Office. Chances being that I'll have to settle for nothing by way of explanation on either score, those matters might as well be put aside--for now, anyway. Meantime, Republicans pondering their choices in the primary just got a picture window-sized view into the political souls of their two gubernatorial candidates.  I wonder how the many South Dakotans who over the years have served voluntarily on "boards, commissions and blue ribbon task forces" feel about Noem's disdain for their value should she become governor.  Her insularity doesn't suit a state where "Under God, The People Rule."  Jackley's got it right.  The more citizen involvement and input, the better.

Monday, April 23, 2018

South Dakota's GOP Hopefuls For Governor Are Missing The Obvious

     It isn't altogether surreal, but there is a certain weirdness that emerges when listening to the leading GOP contenders for South Dakota's Governorship complain about the state of our
Jackley & Noem
Fixers?  I'm Dubious
Last month Congresswoman Kristi Noem told KELO-TV that she "thinks it's very concerning that South Dakota's GDP rate is half what the national average is."  In the same piece, her opponent Attorney General Marty Jackley  touted his "Hometown Initiative,"  described by KELO as Jackley's "own strategy to stimulate the state's sluggish economy."
    Appropriate as these sentiments are, you have to stop and wonder at the political chutzpah that's going on here.  Noem and Jackley are a) essentially acknowledging that after many years of Republican control of state government, South Dakota's economy is in disrepair, and b) that a continuation of GOP ideas and strategies is what it will take to improve things.  What is that old adage about the definition of insanity?  Something about expecting different outcomes from the same behavior, isn't it?  Nothing against the sincerity of the two candidates and their concerns about South Dakota's economic future, but their relentless self-posturing as "conservatives" suggests to me that neither of their administrations will get the state moving at a pace at least brisk enough to keep up with the national economy.
     Stuck on the status quo, both campaigns tout their eagerness to maintain South Dakota's business-friendly status.  That's nice, but somewhat disconcerting in its embrace of futility. Everybody knows that we're business-friendly.  It's old news and it's all over the place.  Along with others, CNN Money and Fortune Magazine list South Dakota as the "#1 Best State For Starting A Business".  These accolades are fine, but have they gotten us anywhere?  Not really.  Our economic development efforts are probably state of the art, but the past 8 years have resulted in the stagnation that Noem and Jackley decry and promise to fix in their campaigns.
     The essential problem is that their efforts focus on low taxation and limited regulation, which are indeed powerful draws for any business.  But those elements alone are not enough to encourage businesses and workers to move to South Dakota. lists intangible quality-of-life issues like education, safety, healthcare, and recreational opportunities as important reasons for relocating.  Republicans keep talking about great jobs, but great jobs don't exist in a vacuum.
     Fact is, South Dakota has failed at attracting enough workers to many decent paying jobs.  Last year the RCJ studied the matter and found that "we lack skilled workers in accounting, engineering, IT, and healthcare, among others." You can't expect much in the way of business start-ups, expansions or relocations in a state that doesn't have enough workers for its existing businesses.  So the compelling question for Republicans is why, after decades of GOP control in this state, do we go begging for skilled workers?  The jobs being there, the answer seems to be that quality-of-life considerations aren't measuring up to modern-day expectations. Republicans, explain yourselves.

Monday, April 16, 2018

Taxing Internet Sales Isn't That Good A Deal For South Dakota

     The internet sales tax case that South Dakota Attorney General Marty Jackley brings to the U.S. Supreme Court (SCOTUS) this week will be a game-changer if Jackley prevails.  As things stand now, many online retailers charge no sales tax on purchases made by South Dakotans, resulting in a loss of $50 million a year in revenues to the state. This has been a two-pronged dilemma because even as the State of South Dakota is missing out on those revenues, our in-state brick-and-mortar retailers have to compete against their internet-only counterparts at a built-in disadvantage. 
I'm Dubious

     That sounds like a losing proposition, all right, but my problem with the AG's effort is that I'm dubious about South Dakota coming  out a winner if SCOTUS sees things Jackley's way. 
Jackley says that "we're fighting for Main Street businesses, we're fighting to give those Main Street businesses that even playing field."  Considering that South Dakota in 2017 had retail taxable sales of $11 billion, the state is giving up a 9% slice of business to the internet, about $1 billion/year, extrapolating from the revenue loss claimed by the State.  Nobody knows how much of that $1 billion in internet sales would be recovered if South Dakotans shopped locally based on the sales tax differential being eliminated.  A 2017 study done by accounting industry giant KPMG, finds that online shoppers list convenience, ability to shop 24/7, ease of price-comparison, and better prices  among their top four reasons for buying on the internet.  No doubt the sales tax savings plays into pricing decisions, but other reasons are also powerful drivers when it comes to consumer purchases.  I think it's reasonable to figure that adding sales taxes to online sales will redirect some business to South Dakota retailers, but a substantial amount of online sales will remain a significant part of consumer behavior just the same. It's probably a pipe-dream for Jackley and the rest of our government officials to contemplate a significant surge in local retail sales if SCOTUS sees things our way on this.  Online shopping is here to stay, and in a big way.
     More problematic is the effect that a successful outcome in our lawsuit will have on start-up ventures in South Dakota.  Every retailer with online aspirations will be forced to deal with the myriad of state and local tax issues confronting internet purchases. The expenses for potentially costly audits and sophisticated software that's able to navigate through this jungle is so high that Andy Pincus, speaking on behalf of eBay in the case, says "for small businesses on tight margins, these costs are going to be fatal in many cases."  I question whether South Dakota's small business culture will be able to evolve and grow in an environment that favors bigger and better capitalized competitors in larger states.
     Meantime, I wonder how Marty Jackley and his campaign for Governor in the coming GOP primary can square this lawsuit with his pledge to keep taxes low.  Stripped of all the "level playing field" rhetoric, Jackley's proposing a tax increase on South Dakotans.  The scramble for more revenues for our cash-strapped state has missed too many potential consequences that in the short-run will cost residents money and in the long run leave us limping in the competition for sales in the modern retail environment.

Sunday, April 15, 2018

Guest Poster Sam Hurst Lets Me Share His Core Principles That Can Make For A Winning Democratic Message In November

Sam Hurst is a Rapid City writer and television news producer.  His latest book "Rattlesnake Under His Hat:  The Life And Times Of Earl Brocklesby" is a terrific account of a legend in the Black Hills tourism industry.  

 As the mid-term elections approach, my greatest fear is not that Donald Trump will swoop into a congressional district and rally his troops for an agenda of concentrated wealth, racism, and global bullying. My greatest fear is that Democrats will not use this historic opportunity to resolve their own internal conflicts and develop a unified ECONOMIC policy with broad appeal to the American people. So I
offer a caffeine-induced exercise, a Sunday morning puzzle if you will. What is the Democratic economic message for 2018 and 2020, in ten core principles or less? Can it be expressed in a five-minute stump speech by everyone running for city council or U.S. Senate? And, can it be the foundation on which the base of the Party vets its candidates?
The premise of this exercise is that these would be CORE economic principles, not a laundry list of all the things that are important to Democratic voters, or specific constituencies. A young Latina Dreamer running for office in south Texas will have a different focus than a farmer in North Dakota. A working class vet of the Iraq War, running in western Pennsylvania will see things differently than a Yale-educated Millennial attorney in San Francisco. There are critical values that candidates will want to express that rise from their own personal experiences: think police abuse, DACA, #MeToo, LGBQT identity themes. There are tried and true cultural issues that Republicans will use to bait Democrats: think gun control, abortion, bathroom access, the war on Christmas. There are also important issues that seem obvious: controlling the power of mega-banks, making world trade responsive to workers and the environment, challenging China, human rights, the war on terror, immigration, money in politics, gerrymandering, mass incarceration, food and agriculture. There are a hundred VERY IMPORTANT policies that Democratic candidates might individually choose to run on, but this exercise is about the core unifying economic principles of the Party that can be expressed as universal themes, in a short stump speech.
As I approach the 2018 election, these are my eight bottom line principles that define who/what makes a Democrat. There are obvious synergies, both between these eight principles and between these eight and dozens of other issues I am interested in. If a candidate is afraid to defend these principles from the podium, she/he just ain’t a Democrat as far as I am concerned.
1. Universal Medicare Option. Every American citizen, regardless of age or economic status should have the opportunity to enroll in Medicare. This is NOT free health insurance. It will be expensive, but the more broadly the costs are shared the less it will cost each individual. It will protect the freedom to choose your own doctor. Medicare is vastly more efficient, and its health outcomes are more effective, than the current system based on private insurance (especially as the Republicans systematically dismantle the already weak ObamaCare system).
The current system of private insurance and employer mandates is onerous on private enterprise. It traps workers into jobs that they hate but cannot escape because they cannot risk losing coverage. A Universal Medicare option would unleash the innovation economy, entrepreneurialism, and higher quality health for our citizens. If voters are afraid that Medicare-for-all will stifle innovation in surgical techniques, pharmaceuticals, or diagnostic technology, then we should invest in the training of physicians and university-based research. Subsidizing private insurance and mega-hospitals has nothing to do with innovation or quality of care. Finally, we cannot control our debt or the shrinking security of the middle class until we remove the artificial economic cost of private health insurance.
2. Community-based public schools. Public schools are the lynchpin of community stability. If there is any value that the Founding Fathers were unified about, it was the importance of free, public education. Teachers/school staff are the foundation of the American middle class. A $5,000 increase in teacher pay is one of the most effective ways to inject economic stimulus into local communities. It is teachers who buy homes, buy shoes for their children, and participate in civic life. Teachers are the “human capital” side of the American infrastructure.
Teachers who are poorly trained and underpaid are as much a danger to society as a rusted bridge. Our economy is based on innovation that takes place at a wicked fast pace. The days of a worker spending his/her entire career with one company or using one skill-set are long gone. The only answer is to promote a culture of “lifetime learning” in the context of community-based public schools. My own preference would be to emphasize early childhood education. Others favor technical education. Others favor university-based research. These are legitimate ideas. But the core principle is that community-based public schools are the institution best suited to promote citizenship, critical thinking, technical education, opportunity, and diversity. The crisis of public education flows directly from the conservative, racist reaction to the 1954 Brown v. Board of Education decision of the Supreme Court. Community-based public schools are, therefore, an entry point for a national commitment to confront racism, segregation, housing discrimination and poverty.
One of the most important grassroots movements today is taking place among teachers in Oklahoma, West Virginia, Kentucky and other RED states on behalf of public schools. It is also worthy of note that these grassroots teacher movements are led by women.
3. Smart-infrastructure. President Trump’s policies on coal and oil are the desperate attempt of a 70 year old man to reinvent the horseshoe. A new generation of Democratic leaders must view infrastructure spending through the eyes of the computer revolution and smart technology. If the idea of “infrastructure investment” is to repair highways, schools, airports, the electric grid, river levies, ports, and transit systems using the old technologies of the 20th century, we will have miserably failed. No infrastructure project should be undertaken that does not integrate the digital revolution, smart technologies, wind, solar, conservation, into its footprint. The days of filling potholes with asphalt, because that’s all we know how to do, are over.
4. Science-based decision-making. One of the great limitations of human evolution is that we have evolved to respond quickly and decisively when a lion attacks us out of the grass. We run, or we fight. If we are smart, we walk through the grass in groups and avoid situations where we are forced to face danger alone. But we have not evolved to respond quickly and decisively to a lion that will attack us in twenty years. Science allows us to see into the future and to understand the challenges of the future. This will require a massive public investment in research universities.
Climate change is the most critical global issue facing humanity. It can only be dealt with at the intersection of education, infrastructure, global investment, and personal sacrifice. The Greenhouse Effect, and the physical and chemical principles that explain it, are a five-minute, 8th grade science lesson. Every Democratic candidate, regardless of the office they seek, should be required to call a middle school science teacher and have the principles of the Greenhouse Effect explained to them in terms that can then be repeated to a lay audience at a county fair. This would be the bare minimum expectation. In framing the problem of climate change for a political campaign, Democrats should combine the tremendous threat with the tremendous opportunity. There are, quite literally, hundreds of jobs in the coal industry and millions of jobs in the industries that must be developed to combat climate change. At this point in the development of geophysical and atmospheric science, any candidate who cannot articulate the fundamental science of climate change in two minutes, and then list all the opportunities, is NOT A DEMOCRAT.
Climate change is global and both a tremendous threat and tremendous opportunity, but the struggle to restore science also intersects with education, health care and global epidemiology, technology, AI, and hundreds of other aspects of public policy. In the 21st century, public policy without science is a prescription for economic defeat.
5. Addiction—The Apollo Mission of the 21st Century: Democrats should advocate a massive national investment in unlocking the science of addiction. We are in the middle of an opioid/heroin epidemic. But we have struggled with the social and economic consequences of drug addiction and alcoholism for centuries. Addiction is a public health problem, not a crime or personal responsibility problem. It is an economic issue of central importance to the security of the population and our communities. We have squandered billions of dollars trying to arrest and incarcerate our way to victory in the drug war, against all scientific evidence. Addiction is at the heart of worker productivity and unemployment, domestic abuse, the uncontrolled (expensive) expansion of our prison populations, international relations with Mexico and Latin America, and runaway health expenses. We still do not entirely understand the science of addiction, or have proven therapeutic and rehabilitation strategies. Addiction crosses all racial, gender, class, religious boundaries.
5. Expand Social Security: Democrats have been so focused on defending security against Republican efforts to destroy it, that they have allowed Republicans to frame the battlefield and they have put their head in the sand when it comes to the demographic revolution (particularly life expectancy) taking place in the nation. This is, in large part, a result of the age of Democratic leadership in Congress, who continue to frame the problem of the social safety net in New Deal terms rather than 21st century terms. Social Security should be solvent, responsive to changing life expectancies, and the wide-ranging ability of individuals to pay into the system. Republicans see these reforms as the first step in abolishing Social Security. Democrats should see these reforms as the first step in expanding the safety net and making pensions and other Social Security services more sustainable. In the future, Americans will live even longer. They will be more mobile, have many jobs/careers, and will work longer. Ask a Millennial if they plan to work for 25 years, retire at 65, and receive a pension for 30 years? A Universal Medicare Option should also be seen as part of the reform of Social Security.
6. Marshall Plan for Latin America and Mexico: Rather than destroying our relationship with Mexico and Latin America, by demonizing and stereotyping their cultures, we should look upon our relations with Latin America as the primary focus of international policy, and international investment. We have our deepest historic relations with Latin America. Latin America is a massive trading partner, and as nations develop it can be even larger. Good relations are essential to solving our intractable problems with immigration. Our historical relationship with Latin America is fraught with imperialist intervention. Our imperial history toward the region, including dozens of military interventions, is a reality that our own citizens are woefully ignorant about, but a 12 year old on the streets of San Salvador can list all the times the United States has invaded a Latin American nation. Creating a new framework for relations will require patience and determination and persistence, especially in the aftermath of the Trump presidency. But it is folly to believe that the United Stats can be economically stable, or can solve its immigration problems without having a new policy in the hemisphere.
7. War is economically destructive: We cannot bomb our way to stability in the Middle East. War is the single most economically destabilizing part of the federal budget and national debt. What would our economy look like if we had used five trillion dollars over the last decade to invest in the economic integration of Latin America into a healthy hemispheric economy, built 21st century schools, and infrastructure based on wind and solar, rather than building bombs, missiles, and the long-term expense of caring for wounded soldiers? Would we have found any fewer weapons of mass destruction? Would Iraq, Afghanistan and Syria be any less stable? Energy Independence should mean independence from the ancient hatreds of desert tribes. All manner of special interests hide behind the cliché of “national security,” but we have lived too long with the conceit that Halliburton’s and Exon’s profit is our national security.
My standard for going to war is very simple. Every member of Congress should hold town halls, and ask this simple question: “Is this war so important to the national interest that you would be willing to have your son or daughter killed on the battlefield?” If the American public is willing to send our own sons and daughters to the battlefield, it is a war worth fighting. If, on the other hand, no one in the audience can even point to the war zone on a map, perhaps it is the wrong war. In the name of global security we have created massive insecurity. In the name of national security we have systematically destroyed our economic security.
8. Progressive Taxation: The fatal flaw in Bernie Sanders’ presidential campaign was to describe his policy prescriptions as “free.” Free health care. Free college. For middle class taxpayers Sanders rhetoric sounded like a mind-numbing prescription for government debt. This is a society built on sacrifice, not free stuff.
A Universal Medicare Option will not be free. Public Schools are not free. College tuition should not be free. Social Security is not free. EVERY American should be expected to pay for the social safety net. If all a person can afford is a dollar. Then they pay a dollar. But the correlate to that principle is that the wealthy benefit the most from our national infrastructure, resources, and system of laws. Therefore, the wealthy individuals and corporations should pay their fair share. The idea that the middle class should pay to support the “job creators” is (as President Bush, I, explained quite vividly) VOODOO ECONOMICS. Taxation should be progressive, and the decision to raise or lower taxes in any given economic environment should be flexible rather than an ideologically rigid, blunt instrument, for the wealthy to de-construct government services and programs.
So, friends, let the conversation begin. Add, subtract, find synergies. But remember…these are core principles.

Friday, April 13, 2018

Kristi Has A Kredibility Problem. It's Called The Federal Debt.

       Talk about chutzpah.  Kristi Noem in 2010 ran and won as a conservative Republican for her seat as our South Dakota Representative in Congress and has been there ever since.  Riding   the fiscally-conservative "Tea Party" wave of those years, Noem ran on a promise of reducing the country's federal debt and getting Washington's "reckless spending" under control.  In a family-themed  television spot she promised to work on reducing each of her children's $42 thousand share of the country's debt.  Now, six years later, Noem's promise turned out to be empty political rhetoric.  She worked on something, all right, but it was the exact opposite of what she promised her South Dakota constituents. Now, despite her glaring failures in Congress, she's arrogantly courting them in her run for Governor.
I Don't Think So

     Since 2011, when the GOP took control of the House of Representatives (Constitutionally delegated with "the power of the purse"), the federal debt has vastly surpassed the levels that existed when Noem took office.  That $42 thousand obligation her kids faced when she was sworn in has swelled to more than $62 thousand now.  Just as disturbing, if not altogether ominous, is that as a percent of our country's GDP, our debt has gone from 91% in '11, to 105% now.  Somewhat more galling to South Dakota's ranching community is that in one of her "throw in the towel" votes (the Omnibus Spending Bill in December 2015), Noem simultaneously eliminated Country of Origin Labeling (COOL) for meat products imported into the United States.  Noem's "yea" on that one broke faith with two of her long-standing principles, conservative budget management and support for COOL.  She had been lauded by South Dakota stockgrowers the previous year for supporting them on this issue, but when it came down to political brass tacks, she turned her back on many of our state's ranchers.
     The COOL rejection was actually part of a complicated trade issue involving the World Trade Organization, which was reason enough for Noem to vote "no."  But acquiescing to yet another budget-busting spending bill?  Noem just went along to get along, the heck with her promises to her South Dakota supporters, who now have much more debt burdening them and their offspring, and their offspring's offspring, and so on, ad infinitum. 
     Meantime, her current status as a budget buster hasn't changed much despite her claims of "conservatism" in the primary.  After a full year of GOP control of Congress and the White House, U.S. borrowing this year will be at an 8-year high, with deficits running about $100 billion higher than last year.  What happened to Noem's commitment to getting this kind of spending and debt level under control?  She's mum, and with good reason.  Failures of this magnitude speak for themselves.

Saturday, April 7, 2018

South Dakota's All-GOP Congressional Trio Are Milquetoasts When It Comes To The Trade War

     South Dakota's all-GOP congressional trio is a little late to the party, but it seems to have finally dawned on them that the Trump administration, which they've unswervingly supported
Rounds, Thune, Noem
If It's Okay With You, Mr. President,
We're Concerned
up to now, may just be one of the worst things that ever happened to South Dakota. 
Both Senators John Thune and Mike Rounds joined with Representative Kristi Noem in recent days to express some misgivings about the game of tariff-chicken that Trump is playing with China.  After listening for months to candidate and then President Trump relentlessly reeling off his contempt for  trade deals that have been profoundly beneficial to South Dakota's farmers for decades, our congressional reps uniformly say they are "concerned" that their leader actually followed through on his contempt for our trading relationship with China.  Given the possible consequences, "concern" seems a little soft by way of reaction.  I'd prefer "outrage," but that's just me. 
     Right now the President is consumed with his need to redress grievances that seem to be of his own making.  Our trade with China in recent decades has been a bonanza for American farmers, considering that a third of the soybeans grown in the United States are sold to China to the tune of $12 billion a year.  We also sold China a little over $1 billion of pork last year.  South Dakota's share of that $13 billion total amounts to about $1 billion, pretty good money coming in to a state with a little over 800,000 residents.  As both soybeans and pork are on a list of goods that China says it will tariff by 25%, you can see why farm organizations are aghast at the prospect, so much so that they have gotten the ears of our state's federal reps about the imminent economic dangers posed by this trade showdown. Why these elected officials couldn't see this coming and start speaking out forcefully before now is probably a function of their political fealty to a president who is either unaware or doesn't care about what happens to South Dakota's economy. 
     Meantime, why aren't these so-called Republicans sounding off against a President who has long since jettisoned his party's historic commitment to free trade?  The right-wing rabble rousing Ann Coulter is so disgusted with Trump that she just called him "a shallow, lazy ignoramous" and counts herself "a Former Trumper."  Even the reliably Republican billionaire Koch Brothers have broken with Trump over this, using a spokesman from their Americans for Prosperity organization to say that "tariffs and protectionism are bad ideas that tax American consumers and hurt American industries when countries retaliate." 
     South Dakota could use a voice in Congress as strong as that of Nebraska's Republican U.S. Senator Ben Sasse, who didn't mince his words.  Sasse isn't merely "concerned," he's furious, saying Trump's plan "will light American agriculture on fire . . . this is the dumbest possible way to do this."  We could use a fighter like that for South Dakota. You can't get through to President Trump via nuance.