About That Single State Recession

Massachusetts Gov. Mitt Romney was in Michigan over the weekend to attend the state Republican convention. He also brought a commitment of $750,000 from the Republican Governor's Association for issue ads aimed at showing voters how poorly the state has fared under Democratic leadership.

"Michigan is undergoing a single-state recession," Romney said. "This initial commitment is being made by the RGA in order to talk about creating jobs and other important issues facing the people of Michigan.

This is the same propaganda the DeVos campaign has been circulating:

Michigan's worst-in-the-nation economy is headed even further in the wrong direction. ... Meanwhile, the rest of the nation is creating millions of new jobs, encouraging strong investment and helping businesses to expand.

Actually, the rest of the nation is NOT doing that well under Republican rule:

Monthly job growth since August 2003 is 50% lower than the average of President Clinton's entire term. Since August 2003, job growth has averaged 160,000 per month. During Clinton's eight years in office job growth averaged 236,000 per month.

Real wages have fallen since August 2003. The average worker's real wages were twenty cents lower in June 2006 than they were in August 2003.

And what about that single state recession they keep talking about? Our neighbors to the south aren't doing any better - and they have a Republican governor!

Ohio No. 1 -- in job losses

The 217,000 jobs that vanished from all of Ohio's goods-producing industries between 1997 and last year -- along with their $9.3 billion in average annual wages -- were the biggest losses of any state in the nation. The state's 15.7 percent decline in total average annual wages also ranked Ohio dead last.

Job losses aren't the only measure of Ohio's economic woes.

The state's gross state product generated by its goods-producing industries -- manufacturing, construction, farming, mining and other natural resources -- fell by nearly $9 billion from 1997 to 2004, again the biggest drop of any state.

The rest of the state's economy -- the service-providing industries -- did manage to grow, but well below the national average and not enough to keep up with Ohio's growing work force. [...]

Worse yet, the new jobs paid considerably less than those lost. The average annual pay for goods-producing jobs was more than $46,000 last year, compared to $35,000 for service-sector workers.

The loss of those manufacturing jobs has a serious effect on the middle-class according to Alan Tonelson, a researcher with the United States Business & Industry Council, a Washington-based advocacy group representing medium and small manufacturers.

"Manufacturing is the only sector that has had large-scale success in taking someone with average skills and schooling and providing them with a salary that will allow them to live middle-class lives," said Tonelson, who wrote the book, Race to the Bottom: Why a Worldwide Worker Surplus and Uncontrolled Free Trade are Sinking American Living Standards.

"Those jobs help support much of the economy."

Unfortunately, Tonelson believes the full effect of the Ford and GM cuts have not started to be felt yet in Ohio. He thinks the state will be very hard hit by them.

Change takes time, especially in a state where the economy is heavily tied to one industry, as it is in Michigan. However, Granholm's job plan is succeeding in creating and retaining jobs, and other people are beginning to take notice.

In truth, parts of Michigan are doing well, including this area in the northwest corner of the Lower Peninsula, where more and more executives from Chicago and other big cities are living and working via Internet and cellphone, while enjoying the lakes and golf courses in their backyards. Ann Arbor and other university towns are also thriving, and some high-tech is beginning to arrive in the state, lured by new business incentives pushed by the governor.

Check it out yourself. The MEDC has a detailed list of jobs created across the entire state - not just the northwest corner of the Lower Peninsula.

In the end, the truth is what really matters to people, and Michigan's GOP has been less than truthful about Michigan's problems and who should bear the blame. Charles Ballard, professor of economics at Michigan State University, put the argument in its proper light:

"If Dick DeVos had been elected four years ago, the Michigan economy would look very much as it does now," Ballard said. "The percentage of the economy that's in manufacturing has been declining for half a century. That's not a blip, that's a trend. And if you're in a state like Michigan, which is much more involved in manufacturing than the average state, that's going to cause problems for you."

UPDATE: I guess great minds do think alike! Zack @ Pohlitics had this to say about Michigan's single state recession: It's basically a load of crap.