Thursday, July 19, 2012

The Walker Administration by the Numbers - Not a Pretty Picture

The Wisconsin gubernatorial recall election has folks on the left scratching their heads over how the results could have turned out as they did.  Many bemoaning the result credit the great disparity in spending between the two candidates, but that seems a hard sell when you see that with far less of a spending disparity in 2010, the results were pretty much exactly the same.

One easy explanation is found in exit polling that showed that 60 percent of voters thought that recall elections were only appropriate in the event of official misconduct in office, and ten percent felt that recall elections were never appropriate.  But that may not adequately explain the result either.  The New York Times  report on the exit polling showed that even where voters felt that a recall should be reserved for official misconduct in office, 31% of those voters identified themselves as having voted for Barrett.  That suggests that a substantial plurality of voters who support the concept of restricting recall to instances of misconduct walked into the polling booth thinking to themselves:  "While I feel this is an inappropriate way to use the recall mechanism, I am going to vote for the candidate I like the best."  In addition, the likelihood is that the voters who were in favor of restricting the recall process (or never seeing it used) were by nature more conservative voters, who could be expected to favor more stability growing out of general elections. 

Another possibility is that voters felt that Barrett simply didn't convince them that Governor Walker needed to be tossed.   Barrett's campaign was excessively based on "I am not Scott Walker," rather than "here is my economic plan for getting the state working again."  To my knowledge, the Barrett campaign never answered the question posed to it:  "How would you have balanced the budget in the spring of 2010?"

An additional possibility is that voters, focused on the economic woes affecting the nation and state were satisfied with the economic performance of the Walker administration.  In this regard, the Governor's team did a brilliant legerdemain with the job numbers, coming out with a new data set drawn from a more complete survey of job creation just before the election that seemed to clearly support that the actual job creation was much more robust than the Bureau of Labor Statistic's monthly survey of job creation.  I discussed this switch in data sets here.

The Barrett campaign missed out on a good opportunity to challenge the Walker administration's contention that all was well with the growth of jobs in Wisconsin in two ways:  First, by taking the new job data being promoted by Walker and explaining  that even under the new set of data, Wisconsin was bringing up the tail end of all the Midwestern states in new jobs created.  This includes running behind Illinois, the state from which the Governor said we would be importing jobs.  Second, to my knowledge the Barrett campaign failed to point out that another key economic indicator the Governor had touted in the spring actually shows that Wisconsin is performing far worse than every state in the country in state GDP growth rate other than Mississippi and Alaska.  I discussed this in March here.

The economic indicator that shows us close to the bottom of the barrel is the Philadelphia Federal Reserve Bank's Coincident Index, which is scored every month.  It is in essence a State GDP rate of growth model tied to several key indicators of economic activity in each of the states.  Each state has index scores which are not directly correlated to the scores of the other states, but importantly, the rate of growth of a state's index can be directly compared to the rate of growth of other states, so that the relatively economic vibrancy of the states can be compared.  As explained on the Philly Fed web site, the coincident index data can serve to inform new businesses or existing businesses what states have healthy economies that might best serve to support business expansion plans in a new state.  Likewise, the Fed says that the data can inform unemployed or underemployed workers where they might want to relocate to fit into an expanding economy.

Based on the most current Coincident Index issued by the Philly Fed, here are the five fastest growing states in the U.S. during the period from January, 2011 (Walker's inauguration) to May 2012, a seventeen month period of time, and the five states growing their economies at the slowest rates (or in the case of Alaska, actually contracting over the period):

 And here is the lineup of Midwestern states:


The growth rate of Wisconsin's economy since Scott Walker became governor is less than one-seventh the growth rate of Ohio's.   It is less than one-sixths of Michigan's.  The slowest growing state in the upper Midwest besides Wisconsin is Minnesota, whose growth rate is over three times our state.  And Illinois, from where Governor Walker predicted jobs would be flowing into our state?  Its rate of growth is almost four times our own.

I suspect we are through hearing about the Coincident Index from the Governor for awhile.

Today at noon we will get the job numbers from the state DWD for June, and it will be interesting to see if this dismal economic track record improves.


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