March 29, 2007

Final 4th Quarter GDP Growth Comes in at 2.5%; It’s Past Time to Address the Obstacles to Higher Growth

Filed under: Economy,Taxes & Government — Tom @ 8:50 am

The advance release in January had 4th quarter 2006 GDP at 3.5% — and there was dancing in the streets.

Thanks to very large and unanticipated inventory reductions during the period (meaning that fewer goods were being produced than originally estimated), the February estimate for 4th quarter 2006 GDP growth was 2.2% — and there was wailing and gnashing of teeth.

Expectations ahead of yesterday’s announcement were for no change.

So what was the final number? A bit of a surprise: 2.5% (related CNN report is here). The revision occurred mostly because inventory additions (due to more goods produced) were a bit higher than estimated a month ago.

The last strong quarter of GDP growth was 2006′s first quarter (5.6%), which enabled calendar 2006 growth to come in at a respectable (but not by much) 3.3%, despite growth during the past three quarters that has been decidedly unimpressive (2.6%, 2.0%, and today’s final 2.5%). At some point, one would hope that someone in Washington starts to notice that Sarbanes Oxley is beginning to hold the economy back in a very big way, especially now that the full impact of the law is being felt down to the mid-caps and small-caps.

How quaint it is that SarBox’s Republican co-author recently admitted that it was “rushed” and “flawed,” before he left his handiwork behind and went into the private sector for a cool $10 million a year (last item at link). The incredibly complicated and time-wasting disclosure requirements relating to executive compensation that are kicking in this year also aren’t helping.

Meanwhile, Ireland, the low-tax shining star of the European Union, reported GDP growth of 6% last year. Just about every other large country in the sluggish-for-years EU would be thrilled if their GDP came in above about 2.5%. Our performance should be closer to Ireland’s than it is to the EU-PU countries. That it is not is unacceptable. Supply-side tax cuts, while wondrous in their impact, can only do so much for growth in a stifling regulatory environment.

Couldn’t Help But Notice (032907)

Iowa Voice (HT Ace) reports on a major New York Times correction. Zheesh. At long last, have they no shame?

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This could be “the longest-running Internet breach ever” (HT Information Week e-mail).

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Ohio has quite a bit of catching up to do in venture capital, if this chart from a Global Insights/National Venture Capital Association study is any indication:

NVCAchart2005_issued2007

Notable absences: Michigan, Wisconsin, and Nevada (Nevada because it has been putting on airs about being a place where techsters can land if they get tired of California’s high cost structure and punitive taxation).

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Voters in Quebec: Secession, Seschmession.

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Another in a long line of CEOs doing his level best to discredit capitalism.

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Speaking of capitalism, the next time someone lectures you about evil, right-wing capitalists who take advantage of others’ misfortunes without so much as a twitch of conscience, point to this (HT The New Editor via Instapundit). I got to the last step before the final okay at the “entrepreneur’s” secure site to confirm that it is NOT a gag. How utterly without humanity and compassion can you be to actually promote a $26 T-shirt by saying that it “will let everyone finally have a good chuckle about the White House spokes liar’s probable fatal cancer”? How sad is it that there is probably a niche market of people who would do something like this (HT Instapundit) who would likely find such a T-shirt “funny”?

Update: Cal Thomas — “The Tony Snow I Know.”

WSJ: Kudos for KIPP — a School Choice Success Story (UPDATE: WSJ on Ohio Obstruction)

Filed under: Education,Taxes & Government — Tom @ 6:14 am

A Monday subscriber-only Wall Street Journal editorial runs down an example of the kind of success Ohio will be missing out on if school choice programs are gutted, as is being proposed:

Kudos for KIPP
March 26, 2007

Rare is the occasion when these columns have reason to applaud more spending on public schools. But news that the Knowledge Is Power Program (KIPP) will receive $65 million to create new schools in Houston is worth a standing ovation.

KIPP academies are charter schools, which are public schools freed from the grip of the public education bureaucracy. Charter schools can employ lengthier school days and longer school years than union work rules typically allow. They can pay teachers based on skills and performance rather than seniority. And charter school principals can fire and replace staff who are underperforming.

In return for such liberties, charter schools are held accountable for producing results in the classroom. And no charters in the country have made better use of their independence than KIPP. The brainchild of two Teach for America alums, Dave Levin and Mike Feinberg, the first KIPP school was started in Houston in 1994. There are now 52 schools nationwide serving 12,000 kids. More than 80% of KIPP students are low income and 95% are black or Latino, yet they regularly outperform their traditional public school counterparts in math and reading tests. Waiting lists are commonplace.

Why would anyone want to cut Ohio kids in failing school systems out of such an opportunity?

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UPDATE: The Wall Street Journal weighs in hard on the school-choice assault by Ohio Governor Ted Strickland in a Thursday subscription-only editorial:

Job One in Ohio

….. For the most part, however, charters are thriving in Ohio and many of them have waiting lists for admission. Large-scale research on charter performance is spotty. But a recent study by the Buckeye Institute found that students in Ohio charters performed better on six of nine academic measurements in math and reading than kids in traditional public schools. This was despite spending less money per pupil and having less-experienced teachers.

Mr. Strickland’s other excuse for this assault on school choice for the poor is that the state needs to save money. Yet the voucher program costs a mere $13 million out of a $53 billion state budget that includes big new spending increases on education and bonuses for the public-school bureaucracy. The Columbus Dispatch reports that from 2001 to 2006, spending per pupil in Columbus schools rose to $11,918 from $9,078. As everywhere, the problem in Ohio schools isn’t money; it’s the status quo of union-enforced mediocrity.

We’d have thought that with Ohio’s many other problems, a new Governor would have better things to do than deny opportunity for poor kids to escape the worst schools in the state.

The best question for those who don’t see (or don’t want to see) the need for school choice is, “If these alternatives are such a bad idea, why are so many people trying to get into them?”

Example: In a subscriber-only editorial Wednesday, the Journal noted the observations of a person who saw first-hand the Harlem Success Academy lottery (bolds are mine) –

The public charter school, which opened last year, is holding an admissions lottery at 6 p.m. to fill 105 kindergarten slots for next year from the 500 or so families who’ve applied for them. Harlem Success was founded by Eva Moskowitz, a reform-minded Democrat who formerly served as a New York City Councilwoman specializing in education issues.

In an interview this week, Ms. Moskowitz described the naked emotions on display at such lotteries, which are a common method for deciding who gets to attend these independently run public schools. “I thought I knew a lot about school choice and ed reform,” she said. “But until I’d done the lottery last year I didn’t understand the desperation.”

“Unlike their middle-class counterparts who can use real estate to determine where their kid is going to school, my exclusively black and Latino parents’ only option is to go through this process. And literally, people are praying and shaking and hoping to get into a school.

Ho Hum Hiring Headline (032907)

Filed under: Business Moves,Economy — Tom @ 6:09 am

From Alabama — auto-industry jobs are being announced literally left and right:

Jobs follow automakers down South
Sunday, March 25, 2007

When Korean automaker Kia said it would build a $1.2 billion assembly plant in Georgia a year ago, Alabama officials vowed the project would mean hundreds of jobs for Alabama residents.

Not everyone believed them, but clearly those Alabama officials were right. This month, Kia’s big sister, Hyundai, said it would expand its Montgomery operation to include a plant that makes engines for those Kia cars assembled in West Point, Ga.

The payoff: 522 jobs and $270 million in new investment.

….. Already, several companies that will supply Kia have said they will create jobs and invest money in Alabama. That’s because they’re already here, supplying Hyundai, and now will expand to serve Kia.

Just one example: HS Automotive, which makes rubber products used in Hyundai vehicles, said it will add 500 jobs to its Enterprise factory as part of an expansion to supply Kia.

Kia’s decision meant 170 new supplier jobs in Opelika, 150 in Dadesville and 120 in Tallassee.

Alabama’s ability to win jobs with this project underscores its growing stature in the industry. It also makes you wonder if Toyota’s decision to build an assembly plant in Tupelo, announced this month, could result in spinoff jobs in Alabama.

Jury Nails Amway Distributors on P&G-Satanism Rumors

From the Associated Press on Tuesday, March 20 — It’s out of Salt Lake City; considering the amount of time this dragged on, the coverage of this event was, to me, surprisingly quiet:

Procter & Gamble Co. has won a jury award of $19.25 million in a civil lawsuit filed against four former Amway distributors accused of spreading false rumors linking the company to Satanism to advance their own business.

The U.S. District Court jury in Salt Lake City on Friday found in favor of the Cincinnati-based consumer products company in a lawsuit filed by P&G in 1995. It was one of several the company brought over rumors alleging a link with the company’s logo and Satanism.

Rumors had begun circulating as early as 1981 that the company’s logo – a bearded, crescent man-in-moon looking over a field of 13 stars – was a symbol of Satanism.

The company alleged that Amway Corp. distributors revived those rumors in 1995, using a voice mail system to tell thousands of customers that part of Procter & Gamble profits went to satanic cults.

….. The former Amway distributors thought they’d be exonerated and were shocked by the jury’s verdict late Friday, said Randy L. Haugen, one of the defendants.

“It’s hard to imagine they’d pursue it this long, especially after all the retractions we put out,” said Haugen, a 53-year-old Ogden, Utah, businessman who maintained P&G was never able to show how it was harmed by the rumors. “We are stunned. All of us.”

Only a long-time Amway Independent Business Owner Distributor top-of-the-heap exploiter would be “stunned” at the obvious. No wonder this guy didn’t want voters to know anything about his Amway connections (scroll to fifth item discussed) when he ran for Congress in Ohio’s Second District in 2005 and 2006.

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UPDATE, April 2: Okay, this is bizarre, and it may not be over.

Positivity: Seniors Donate Class Trip Cash To Beloved Teacher’s Trip (Follow-up: Resort Gives Seniors Free Class Trip)

Filed under: Positivity — Tom @ 5:59 am

From Lisbon, NH (HT Lincoln Logs):

Tuesday March 20, 2007

LISBON, N.H. — What goes around comes around. That’s a saying members of the Lisbon Regional School Class of 2007 discovered this week.

The students, 38 in all, donated money that was supposed to pay for their senior class trip to a beloved teacher, Emory Younkins, who is ill with multiple sclerosis, for his long-dreamed-of vacation to France.

When officials at the nearby Mount Washington Resort at Bretton Woods learned of the good deed by the Lisbon seniors, they thought a second round of generosity was in order, and the entire senior class has been given free lift tickets and ski rentals to use this Thursday at the mountain.

“Aren’t the seniors a good bunch?” guidance counselor Mary Coleman of Lisbon Regional School said.

She called to the resort to see if she could get a discount for the students, and when the resort got back to her, she was told the kids would be getting “a miniature senior trip,” on Thursday, including a free bus ride from Wally Berry, who owns Berry Transportation.

“I almost fell over,” Coleman said. “Once I told [the students], it kind of spread pretty quickly.”

Greg Bennett, a senior at the school, is one of the students who suggested the seniors give their trip money to Younkins.

“He was talking about Istanbul one day in class and he said it would be great to see some of these places,” Bennett said.

He talked to a friend, Rob Mackenzie, about maybe sending their teacher on a trip somewhere.

“We talked to one of the other teachers in the building,” Bennett said. “To find out where he’d really want to go, we talked to his daughter Katie and she found out that France is the place he’d really want to go to. It was all in secret, and Katie got worried that maybe the word would get out. It was a unanimous vote to send him to France.”

Younkins will travel to France with a relative, students said.

“Our class has had him for seven years now, most of us have had him every year during that seven years,” Bennett said. “He suffers from MS and we wanted to send him before his health got to the point where he couldn’t travel anymore. He gets tired really easily. It feels good to do this for him. We can’t really match what he’s given us.” …..