Monday, March 26, 2012

Walker touts economic forecast that shows we're "treading water" (at best)

Governor cites study his administration had previously ignored

Gov. Scott Walker recently took the time to tout a new report that says Wisconsin's economy is set to improve.

"Strong signals suggest we are turning things around for Wisconsin’s economy," Walker said, "and the Federal Reserve Bank of Philadelphia’s newest report of state leading economic indexes provides yet one more indication that our pro-jobs policies are moving us in the right direction."

That's an interesting study to choose, however -- previous Philadelphia Reserve Bank reports have been scoffed at by the Walker administration and his supporters after they have consistently shown Wisconsin heading in a more disastrous path. It's also highly misleading: the entire country is set to improve, and Wisconsin is going to be behind the rest of the pack once again.

State Rep. Brett Hulsey agrees.

"Governor Walker’s press release tries to spin this report but the Federal Reserve says we have the 2nd worst economic performance in the nation in the last three months," Hulsey said. "Walker and the GOP’s extreme policies put us in a tailspin and we had the worst job losses in the nation last year."

The improvements in the forecast is better than going backwards, to be sure. But even economists in Wisconsin say there's sufficient reason to be skeptical:
[UW-Whitewater economist Russell] Kashian is familiar with the Philadelphia Fed reports and says the number crunchers who compile them do their best to paint an accurate picture. But he says a 1.9 percent growth rate for Wisconsin is hardly worth celebrating.

“Not to bad-mouth the governor, but at best we’re treading water,” he says.

That’s because Kashian says Wisconsin needs at least a 2 percent annual growth rate to simply account for the increase in population and improvements in productivity.
So we have a growth rate that's positive, but it's impact isn't anything that's going to stop us from going backwards still due to population growth. We also have an economy that's growing at the national level as well, meaning that it's possible Gov. Walker is riding on the coattails of President Barack Obama's latest economic improvements.

We should look at any improvements in our state in a positive light: indeed, it'd be wrong to root against Wisconsin's economy, to cheer every time something bad happens under Walker's watch. But we should also be skeptical over data that shows improvements at rates that are unable to do anything positive for Wisconsin, too.

Walker's deliberate misuse of the Reserve Bank's latest economic findings is excessive celebration on the part of the governor. For our state to do better, it's going to need a drastic change, a departure from the economic beliefs of Gov. Walker's pro-corporate (and anti-worker) state.

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