Economic Development and Jobs

ALEC boosts Ohio’s ranking on its anti-government/anti-tax policy wish list

May 24, 2013 By Ben Peyton Leave a Comment

This week, the conservative-leaning American Legislative Exchange Council (ALEC) released its 6^th annual Rich States, Poor States: ALEC-Laffer State Economic Competitive Index. According to the report, Ohio’s “competitiveness” ranking went up last year from 37^th to 26^th. Don’t be surprised to see politicians point to this as evidence that their radical economic policies are working here in Ohio.

The ALEC report is just one of a host of “studies” released each year that attempt to measure which state economies are the most business-friendly. These reports are nothing more than a platform for these groups’ anti-tax/anti-government ideologies and use flimsy analysis that would fail any college 101 statistics class. For instance, the report evaluates Ohio against other states in terms of factors such as its minimum hourly wage, average tax rates and how union-unfriendly its laws are. In reality, these reports — and these factors — have proven to be very poor predictors of how states’ economies will perform in the future. [Read more...]

Filed Under: Economic Development and Jobs, Innovation Station Tagged With: ALEC, Economic Growth, Economy, Ohio Economy

Republicans Unleash New Attack on Workers Rights in Ohio

May 1, 2013 By Terra Goodnight 1 Comment

Public and private-sector unions are targeted by new Ohio legislation.

State Representatives Kristina Roegner (R-Hudson) and Ron Maag (R-Lebanon) today announced their intention to introduce legislation that would make Ohio a so-called “Right to Work” state.

Three bills will be introduced. Two would make it illegal to require an employee to join or pay dues to a union as a condition of employment – one each for the public and private sectors. The third would put the issue on the ballot for voters to decide.

Unions would maintain collective bargaining rights, but membership would be expected to decline sharply as non-union workers would be allowed to benefit from union negotiations without paying dues. As a result, unions would lose strength to negotiate working conditions, wages and benefits.

At an afternoon press conference, Maag and Roegner said the bills had 16 cosponsors.

Roegner suggested offering three separate bills would allow a conversation in which Ohioans would “choose” the best path forward. If all three measures were adopted, however, it would mean labor organizations would have to mount three separate campaigns for their defeat: attempting to defeat the two new laws through a referendum while simultaneously working to defeat a constitutional amendment. [Read more...]

Filed Under: Economic Development and Jobs, Innovation Station Tagged With: Labor, Right to Work

PolitiFact finds Oil and Gas Industry Jobs Claims to be Dubious

April 30, 2013 By Ben Peyton Leave a Comment

On Monday, the Cleveland Plain Dealer released a PolitiFact that examined recent ads by the oil and gas industry claiming to have created 40,000 jobs last year in Ohio. PolitiFact gave the ad its lowest rating — “Pants on Fire” — and strongly questioned the industry’s job creation claims.

PolitiFact found that the ads overstate the number and type of jobs created and failed to disclose that many of these jobs may have gone to out-of-state workers. In addition, they found the fact that the numbers were based on economic modeling rather than actual surveys of employers undermined the veracity of the claim.

PolitiFact also noted the high rate of turnover in industry hiring data, showing that even if Ohioans are being hired, the work is often temporary in nature. [Read more...]

Filed Under: Economic Development and Jobs, Energy, Fracking, Innovation Station Tagged With: Fracking, Jobs, Oil and Gas

Promises Made, Not All Kept as Kasich Turnpike Plan Moves Into Legislature

February 7, 2013 By Terra Goodnight 1 Comment

Hearings began Wednesday on the Kasich administration proposal to borrow against future Turnpike tolls to finance transportation projects around the state. Those hearings, and the bill which was released Tuesday, make clear that there are serious deficiencies in the details of the proposal when compared to the promises made by Gov. John Kasich in December.

When announcing his plans for the Turnpike, Kasich assured northern Ohioans that their tolls would not go up, that no layoffs would occur and that 90% of the proceeds of the borrowing against future toll revenue would be spent in northern Ohio.

Unfortunately, the language in House Bill 38 contains no such requirements.

Just Where is the New Turnpike Money Going?

February 5, 2013 By Jenny Brodie 2 Comments

Back in December Gov. John Kasich and ODOT Director Jerry Wray rolled out the results of the KPMG analysis and their plan for “unlocking the value” of the Ohio Turnpike. As part of their plan, Kasich said that they would leverage Ohio Turnpike tolls to float bonds to finance highway construction projects throughout Ohio.

As part of this announcement, ODOT said, “more than 90 percent of new bond money will go directly to northern Ohio highway projects.” KPMG, the consultants that Governor Kasich paid to carry out the analysis of turnpike, said “virtually all Turnpike funds go to Northern Ohio.”

Even prior to the KPMG analysis, Kasich said “’We’ll make the commitment that at least half the proceeds from a lease or bond would mean we put at least half the money on roads that are north of Route 30. We think that is a fair thing,’”

Sounds like a pretty solid promise to continue to dedicate Turnpike funds to Northern Ohio, right?

Not so fast. [Read more...]

Filed Under: Economic Development and Jobs, Innovation Station Tagged With: Jerry Wray, John Kasich, Ohio Budget, Ohio Turnpike

Right To Work – a good way to increase inequality and lower wages

January 31, 2013 By Ben Peyton Leave a Comment

In mid December, Michigan became the 24^th Right to Work state and the second state on Ohio’s border to enact such legislation (Indiana being the other). Michigan’s law was passed under questionable circumstances. The bill never received a committee hearing or any public discussion, then passed the legislature without a single Democratic vote, and was signed by the Republican Governor immediately.

Since then, certain conservatives in Ohio have come out in support of a right to work initiative here in Ohio but key leaders like Gov. John Kasich have said this would not be the time for such an effort.

Whether there is a movement to put a right to work initiative on the ballot sometime this year, or in 2014, inevitably Ohioans will start hearing about the horrors associated with having unions in Ohio. About how unions kill jobs, force businesses to relocate to other states, and are basically the scourge of the earth. While I at least look forward to systematically taking those arguments apart, today I want to focus on just a single issue: Union membership and income inequality.

On Friday, Kevin Drum with Mother Jones magazine published a piece looking at the rate of union workers in the United States and in Canada and comparing the rate of income inequality in the United States and Canada.

As you can see in the graph above, union membership in the United States is at an almost all-time low. Only about 11 percent of private sector employees are members of a union while in Canada that number is at over 30 percent and has been since the 1970′s. There are a variety of reasons for why this chart looks this way but the basic reason is that Canadian labor law is much more union-friendly than U.S. law. It is much easier for employees in Canada to start unions at their place of business while in American the process can be very bureaucratic and slow.

Republican governors pushing radical tax reforms that could be at Ohio’s doorstep soon

January 30, 2013 By Ben Peyton Leave a Comment

In Washington, President Obama and Congressional Democrats secured a historic fiscal victory in early January. By finally passing legislation that asked the wealthiest Americans to pay a little more in taxes, lawmakers moved one step closer to securing our nation’s fiscal health.

At the state level though, Republican Governors from around the country are pushing for tax reforms that would do the exact opposite. These governors want to see income taxes reduced or eliminated while raising other more regressive taxes that harm low- and middle-income taxpayers. These pieces of legislation are taken straight from the radical conservative playbook in an effort to transfer the burden of paying for public services from the wealthiest to the less well off. The Republican argument is that if a state lowers their income tax rate it will become more competitive in the eye of businesses who may want to relocate there or to help attract high-skilled workers.

For example, according to a recent New York Times article, Kansas Republican Gov. Sam Brownback introduced legislation to phase out the state’s income tax by cutting services and keeping in place what was meant to be a temporary increase in the state’s sales tax. Republican lawmakers in Kansas said that individuals were leaving the state to move to states that do not have income taxes and that this legislation would make them more competitive.

In reality, recent evidence points to the fact that there is no correlation between a state income tax rate and economic growth. What is worse is that these policies are simply another gift to the rich at the expense of low- and middle-income workers.

Paying for Ohio income tax cut with revenue from gas patch looking sketchy

January 16, 2013 By Ben Peyton Leave a Comment

wellhead2 Oil and gas development in Ohio is once again going to be a major policy issue in 2013 and Gov. John Kasich intends to push for an increased severance tax on horizontal drilling in Ohio to help pay for a $500 million income tax cut.

While it’s true that the oil and gas industry is growing in Ohio at this time, is it possible that the administration is being overly optimistic in its projection of how many producing wells there will be in the near future? Proper forecasting of wells and production estimates are essential because the production from these new oil and gas wells will pay for Kasich’s income tax cut. That’s why Innovation Ohio was interested in seeing how close the Kasich administration well estimates were to reality in 2012.

Kasich appointees kill game-changing solar project and 600 jobs

January 10, 2013 By Ron Sylvester 4 Comments

The Turning Point Solar Project truly tells a 21st century, new Ohio economy story. It would be the largest solar project East of the Mississippi and is being built on reclaimed coal strip mine land. It’s a fantastic partnership of one of the nation’s largest utilities, working with a solar manufacturer who chose to locate in Ohio because of the project. In return, the solar manufacturer, committed to hire 60 percent of their workforce from returning Ohio veterans.

This project has been underway for over two years. The manufacturing plant in Napoleon is ready to expand and hire more workers. The companies involved were ready to hire the workforce and construct one of the largest solar projects in the world in Southeast Ohio, a region of our state that could certainly use a shot in the arm.

The project has it all, except for political leadership.

Yesterday, in a 3-1 vote, Kasich appointees to the state’s Public Utilities Commission denied the project. The three commissioners who voted against the project have little to no experience in the public utilities sector.

On the other hand, the experienced PUCO staff recommended the project be granted approval, and did so with vigor.

In addition, the only PUCO commissioner with extensive experience in electric regulatory law supported approving the project.

The bottom line: American Electric Power did the right thing—they created a game-changing project for Ohio, which the PUCO staff said was needed for AEP to be in compliance with Ohio laws. The project could create over 600 new Ohio jobs and would have given our state a positive spotlight we so deserve.

So why isn’t Governor John Kasich outraged that his appointees rejected a job creating project?

Kasich’s spokesperson says that they don’t want to get involved in the decisions of an independent commission. That’s odd, because they already have. Kasich admitted making calls when the American Electric Power rate case was going to negatively impact Ohioans. At his request, the PUCO rescinded the case. So why would he not inject himself in a decision that has over 600 jobs on the line, supports Ohio manufacturing, helps a utility meet their needs and makes Ohio more competitive?

There is some speculation that Kasich remained mum on this one due to one of his largest campaign contributors, First Energy, coming out against the project. We can only hope that Kasich doesn’t stay silent forever and shows some of the “finance” and job creating skills he’s so fond of telling Ohioans has in spades.

If this is the end for Turning Point Solar, Ohioans have one man to blame – and that’s the governor who could (have?) done something.

Filed Under: Economic Development and Jobs, Energy, Featured Items, Innovation Station Tagged With: John Kasich, PUCO, Turning Point Solar

Failure to extend the payroll tax cut will shrink Ohio paychecks and slow economic growth

December 12, 2012 By Ben Peyton

In all recent coverage of the fiscal cliff at IO, our sister organization, IO Ed Fund and elsewhere, one important detail has gotten relatively little notice. President Obama’s proposal to Congressional Republicans includes a one-year extension of the payroll tax cut enacted in 2010. Without an extension, payroll taxes will go up at year end, meaning workers will see less in paychecks starting in January.

The proposal is good news for the economy and for working Ohioans who will take home — and most likely spend — $525 more on average as a result. According to the Center on Budget and Policy Priorities, below is the impact of the tax cut on various professions:

With no extension, lawmakers will place a significant burden on an economy struggling to grow. Today, Moody’s Analytics released its outlook of the U.S. economy for 2013 and noted that one of the major headwinds that the economy could face is the expiration of the payroll tax cut. Moody’s estimates that allowing the tax cut to expire will cause the economy to shrink by .6 percent in 2013.

As the Center for Budget and Policy Priorities wrote last week, over 150 million workers — including 5.7 million in Ohio — will see some benefit if the payroll tax cut is extended. Those estimates are based on 2010 and 2011 employment numbers, so the number in 2013 is likely even larger.

Because the president’s proposal makes the tax cut temporary, an extension won’t add to budget deficits permanently. Compared to extending the Bush tax cuts for high-income taxpayers which could add $1 trillion to the debt over ten years — and not offer much in the form of economic stimulus –extending this tax cut is a relative bargain.

Extending the payroll tax cut is an important policy that will get more money into the hands of Ohioans to help stimulate the economy in 2013 and is a policy that both sides should support.

Filed Under: Economic Development and Jobs, Featured Items, Innovation Station Tagged With: Fiscal Cliff, Ohio, Payroll Tax, Taxes