In speeches and media appearances, Republican governors savage President Biden over policies they say are ruining the US economy as a whole. But in individual cases, i.e. in our own federal states, the economy is booming.
Somehow, Republican governors in states as diverse as Maryland, Florida, Massachusetts and Arizona are suggesting they’ve found a magic formula to fuel booming growth and reduce unemployment at home.
Take, for example, these remarks from several governors’ annual addresses this year:
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“Our economy is struggling,” said Kevin Stitt of Oklahoma, before continuing, “As unemployment has skyrocketed in some parts of the country, ours has fallen to just 2.3 percent.”
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“Job creation in Florida is well above the national average,” said Ron DeSantis of Florida. “And our labor force has grown six times faster than the nation’s.”
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“Our unemployment rate is below 4 percent for the first time since March 2020, and we’ve regained over half a million jobs,” said Charlie Baker of Massachusetts.
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“Our economic recovery is one of the best in America, our unemployment rate is the lowest since the pandemic, and a national survey named Maryland the state with the most improvements for business in America,” said Maryland’s Larry Hogan.
It’s not so easy to separate the performance of individual states from that of the nation, say economists — let alone attribute that performance to a specific move by a governor. Nevada, for example, has been particularly hard hit by the pandemic because of its heavy reliance on tourism.
“Presidents have less to do with economics than people think, and the same goes for governors,” said Michael Strain, an economist at the American Enterprise Institute, a conservative think tank.
Republican-led states have seen a faster recovery in their employment levels after emerging from the pandemic, observed Adam Kamins, senior director of economic research at Moody’s Analytics. But he added that deeper structural issues — demographic patterns, housing affordability — have played a bigger role in spurring growth in states like Idaho and Utah than any specific policy.
“You’re certainly seeing stronger job growth in the Republican-controlled states,” Kamins said. “But correlation is not causation.”
Among the states that recovered the fastest, Kamins noted in an analysis, was North Carolina — whose governor is a Democrat.
Republicans see it differently. Seventeen of the 20 states with the lowest unemployment rates in January are governed by Republicans, noted Jesse Hunt, spokesman for the Republican Governors Association.
“It’s no coincidence,” Hunt said. “They enacted conservative policies that allowed their states to recover from the pandemic faster than Democrat-led states.”
Governors have certainly made compromises between the health of their people and economic growth during the pandemic, said David Cooper, an economist at the left-leaning Economic Policy Institute. Cooper noted that seven of the 10 states with the highest per capita deaths from Covid-19, including Oklahoma, had Republican governors.
“Is that really a win?” asked Cooper.
Others point out that infusions of federal money during the coronavirus pandemic, like the CARES Act and the American Rescue Plan, have a lot more to do with bailing states out of economic disaster than anything individual governors have done.
“Basically, it’s crazy to say, ‘Our politics are good. yours are bad. Our unemployment is very low and our inflation is very high compared to the rest of the country where unemployment is only low and inflation is only high,” said Betsey Stevenson, who served on the White House Economic Advisory Council from 2013 to 2015.
Several economists we spoke to said luck played a big part in how badly a given state was hit by the pandemic — a complex equation influenced by demographics, population density, and industry mix.
One economist likened politicians’ claims of influencing the course of the economy to “a rooster crowing at dawn”.
“Washington at its worst”
Republican governors have also happily promoted specific investments made possible by the American Rescue Plan, Biden’s $1.9 trillion economic bailout, passed last March without naming the original source of the money.
DeSantis, for example, said the plan was “Washington at its worst.” But he later addressed his proposal for a $1 billion gas tax holiday, along with bonuses for teachers and first responders — all of which were based on federal funds. On Wednesday, he revealed nearly $300 million in spending on education, not realizing the money came from Washington.
Florida’s state budget benefited from billions from the bailout alone: $8.8 billion in state and local tax refund funds, $2.47 billion in child care stabilization and supplemental funds, $703.8 million in funds for the K-12 education and $740.5 million in emergency rental assistance. Florida cities also received $7.11 billion to plug the holes the pandemic had left in their budgets, along with $6.33 billion in education funding and another half billion in rental subsidies.
The pattern is similar in other red states:
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In Iowa, Gov. Kim Reynolds boasted about her state’s investments in broadband, housing and water quality — all of which came from the bailout plan.
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South Dakota Gov. Kristi Noem used bailout funds to fund water projects, affordable housing and daycare.
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And Hogan, the governor of Maryland, has spoken out about federal crime-fighting programs funded by the bailout plan, though he said he voted against it.
“This is absurd on several levels,” said Dean Baker, an economist at the left-leaning Center for Economic and Policy Research. “To destroy a policy and then take advantage of it – that’s a pretty high level of hypocrisy.”
Republicans see no contradiction in taking federal funding while criticizing the legislation. Some have said they had no choice but to accept the money, which would otherwise be sent back to the Treasury. They have also complained that the Democrats’ decision to allocate funds in the bailout plan based on a state’s unemployed population, rather than its total population, unfairly penalizes red states.
The Fed gets one vote
Democrats have urged Biden to give more credit to the economic recovery in hopes it will help them in November’s election.
They got their wish during the President’s recent State of the Union address when he said, “Our economy added over 6.5 million jobs in the last year alone, more jobs in one year than at any time in American history.” , and called it “the strongest growth in nearly 40 years.”
The U.S. economy has actually grown at a rapid rate — nearly 7 percent — over the last three months of 2021, and the national unemployment rate has fallen to 3.8 percent.
But that could change soon.
On Wednesday, the Federal Reserve forecast a sharp slowdown in the US economy this year as it announced plans to raise interest rates to combat rising inflation – a reminder that politicians should be cautious about borrowing for rapidly changing economic conditions could.
“This is a much bigger problem than a governor or even the president can handle, and the ways they can influence aren’t all that popular,” said Stevenson, the former member of the Council of Economic Advisers.
what to read
the former guy
Trump changes his tune
Just a few weeks ago, Donald Trump praised Vladimir Putin as an accomplished genius. But the ex-president now sees things differently.
In an interview published Tuesday night in the Washington Examiner, Trump said he expected Putin to do a “good deal” rather than invade Ukraine. He expressed his disappointment with Putin’s decision and said the Russian president had changed.
Trump’s reversal on Putin comes as the country rallies around Ukraine. In Washington, members of Congress held back tears as Ukraine’s Zelensky pleaded with them for more help, and spent the afternoon debating what action should be taken.
And public opinion continues to show broad support for sanctions on Russia by Democrats, Republicans, and independents. Monmouth University released a poll on Wednesday that found nearly 90 percent of Americans believed Russia’s invasion of Ukraine was unjustified.
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