Archive for April 8, 2009
Recession 101 in a Right-to-Work State: Business Alone Cannot Save Iowa
by Gerald Reese
The Progressive Cedar Valley Voices Project - in the West Branch Times, is a citizen response to state Rep. Jeff Kaufmann’s column during the legislative session.
Iowa, along with the rest of our nation, is in a deep economic recession. And we are not recovering very fast.
There are many thoughts and theories as to how to stimulate our economy to recover. Waiting for business and industry to bring jobs into Iowa is not going to do the trick. Remember macro economics 101 says that stimulating industry to create more supply when there is not the demand, is a failing grade. Our governor and our president want to stimulate the economy by creating jobs through new and existing infrastructure projects. That will create demand for goods and services which in turn creates additional supply. It is a simple theory. And it works!
We are all in this mess together, and it will not resolve itself by all the bickering and finger-pointing in our legislature. We need to take the stimulus money we are offered and put Iowans back to work. We cannot afford to wait for industry to waltz in and set up shop. By putting Iowans to work at a living wage building new and repairing existing infrastructure, we will attract industry to Iowa. Iowans have a great work ethic and are willing to go the extra mile to ensure success when new industry starts up in Iowa.
Our state senator, Jim Hahn, decries Governor Culver’s spending plan as unnecessary and will do nothing to improve our infrastructure (Advocate News, 3/26/09). He would have us believe that if we sit on our backsides and wait for industry to bring low-paying jobs to Iowa, all will be well. Mr. Hahn believes that we cannot “hinder the creation and retention of jobs in Iowa (ibid)”. He would have us believe that promoting Iowa as a Right-to-Work state is essential to attracting new industry. While this may have some validity, it is the work ethic that Iowans display that should be the attracting force. Giving away the farm through tax abatements, etc, while taxing already strapped workers to pay the way, should not be appealing to the good people of Iowa.
Rep. Jeff Kaufmann also does not want to hinder private capital investment in Iowa. He says “Economic development is the source for real hope (ibid)”. By cutting spending and reducing waste we will balance the budget. His favorite target in reducing spending is to reduce taxes by cutting wages and benefits to state workers. This is the second time this man has slammed the state work force as over-bloated and overpaid. Iowa needs a strong state work force to keep up our physical plants, our schools, and our universities. Using essential state workers as whipping posts to disagree with the governor’s plan to stimulate the economy is immoral. These workers give their all to make Iowa a better place to live and raise a family.
At least the Democrats have a working plan to help the economy recover. History is on the side of government spending in times of recession and depression. It was FDR’s New Deal that put workers back to work on public projects. It was the Social Security Act that gave workers the hope that they would have something in old age. It was the establishment of the welfare system that gave hope to those unable to provide for themselves. It was this spending that created demand for goods and services. Let’s take the stimulus money and run with it. Hope is on the way.
Gerald Reese is retired from the University of Iowa and lives in Wilton. His hobbies include politics, gardening, reading and spending time with his family.