South Dakota Compensation Growth Ahead of Curve; National Growth Lags Inflation

The center holds: in 2008 compensation showed the strongest growth in the Great Plains. [Click image to enlarge; source: U.S. Bureau of Economic Analysis]

We're richer than we thought... or at least we're getting richer faster than the Coasts: even as the housing bubble burst and the country slid into recession, South Dakota and the great American midsection showed the strongest compensation growth in the country. Most South Dakota counties posted compensation growth of 3.9% or better; all those dark blue counties on the map beat 6% growth.

Nationally, compensation grew 2.3%, while inflation was 3.3%.

Now sure, our wages grew faster than the national average, but we've got room to grow. South Dakota's average compensation per job in 2008 was $40,726. Across the U.S., average compensation per job is $56,116. Adjust for cost of living, and South Dakota's average wages are still 79% of the national average.

Locally, wages are even thinner: Average compensation in Lake County is $36,439.

Some interesting facts from the BEA data:

• In the 618 counties of the Plains region (from ND to MO), 46.5% of compensation is concentrated in just 10 counties.
• Nationwide, 168 large metropolitan counties (out of 3112 counties total) account for 65.8% of compensation. That means nearly two thirds of our wages are made by folks who supposedly aren't real Americans.
  
• The sector providing the fastest growing compensation on the Plains: mining, up 16.6%.
• The sector contracting fastest on the Plains: information, down 0.8% (and here I thought going to DSU would be a moneymaker!).
• In the economically largest counties (those with total compensation of $10 billion of more), the sector paying the largest share of compensation is professional, scientific, and technical services (10.7% of total compensation).
• In the next tier of counties (paying out $1 billion to $10 billion), the sector paying the largest share of compensation is health care and social assistance (11.7% of total compensation).
• In the vast bottom tier of counties paying out less than $1 billion (72.8% of counties), the sector generating the biggest share of compensation is local government (16.5% of total compensation).
  

Lake Herman Solid for Ice Shacks and Bikes!

Who needs a bike trail to Lake Herman...

how I got home today

...when there's a bike trail on Lake Herman!!!

No breakthroughs, no broken bones... sure I'm smiling!

The ice shacks are out on Lake Herman. I rounded the south shore, then pedaled straight across from the state park to the western shore. No big heaves, no mushy spots... but remember, that was 150 pounds of guy and layers on 30 pounds of bicycle. If you really want to haul your two tons of pickup truck out on ten inches of ice, that's your business.

Lake Herman State Park, southeast shore

See more photos from my solstice ride on Lake Herman @ Flickr. Happy Solstice, pagans and believers of all flavors!

I-29 Economic Corridor Study Sends $118K Down the Road; Next Time Hire Locally!

As the I-29 Economic Corridor study gets going, I can already predict one conclusion: South Dakota communities are far too eager to send their money right down I-29 and out of the state to pay for research they could do themselves. We're paying Rural Technology Strategies Inc. of North Carolina $117,500 to study our economic prospects. I'm sure the folks from RTS Inc. will buy a few sandwiches when they drive through to collect their data, but wouldn't we get more bang from the buck if we hired locally for projects like this?

Ah, but who's smart enough to crunch all those darned numbers?

How about our high school students?

The Miner County Cash Flow Study has been the most successful effort to support local buying in Miner County, SD to date. The study involved high school students surveying county residents about their spending habits and then sharing the results with the public in an effort to help community members understand their impact on the local economy [Mike Knutson, "What Do Your Local Businesses Think?" Reimagine Rural, 2009.12.18].

Knutson also points to a local economic survey in Ames, Iowa, that their Chamber is conducting with volunteers from the local young professionals group. Projects like these are a great way to kill two economic development birds with one stone, getting useful data and engaging young people. Help your students feel like stakeholders, and there's that much more chance they'll stick around to fuel the economic development you're after.

Madison Coffee House Seeks Alcohol License

We have a buyer! Well, a leaser, at least. Madison's lone and currently dormant coffee house, Common Grounds, appears to now be in the hands of Shaun and Jenny Bader of Burnsville, Minnesota. According to an application in tonight's Madison City Commission agenda packet (see page 21 of the PDF), the shop will be renamed Mochavino—

—Mochavino? Yes, evidently the Baders have decided that the reason the Common Grounds business model didn't rake in big bucks in Madison was that it didn't sell wine and malt beverages.

Sigh.

On the positive side, maybe the reopened shop will recoup the job losses from the closing of Mr. Movies. Also in the plus column: we may be convincing a couple of young professionals to give up the hustle and bustle of the Cities (or busy suburban Burnsville) to come to Madison... or come back! Shaun is a network engineer; Jenny sells jewelry. She used to sell jewelry through Gems by Jenny on South Egan Avenue. Jenny still has connections to the neighborhood: her public Facebook profile indicates she is friends with various Madison folks, including City Commissioner Nick Abraham, who will be voting on her new business venture tonight.

Dems Protect America; Thune Votes Against U.S. Military

Support the troops? Not if it doesn't fit the GOP's agenda.

In a glittering example of putting partisan politics above America's security, Senator John Thune voted against giving our brave men and women in uniform the resources they need to defeat the enemies of freedom. 29 Senators, all Republicans, joined Senator Thune in this cynical ploy to turn our soldiers into pawns in their Beltway machinations. Their vote would have blocked funding for the Pentagon and left our soldiers and our homeland defenseless against al-Qaeda, North Korea, Iran, and all the other threats our nation faces in these troubled times.

Fortunately, the patriotic Democratic majority, plus true American socialist Senator Sanders from Vermont, stood firm in their resolve to support our armed forces. Republican Senators Collins, Hutchison, and Snowe deserve credit for defying their myopic GOP bosses and casting the right vote in the ongoing Global War on Terror.

(Gee, I see why the right-wingers enjoy using this language: jingoism is seductively fun!)

SD 10th in Anti-Tobacco Programs; More Investment Good for Budget

South Dakota, like many other states, faces increased Medicaid costs as the recession kicks more people out of their jobs and their health insurance. One way to cut those Medicaid costs may be to spend more on programs to fight smoking.

Marci Greenstein at Understanding Government reminds us that tobacco prevention is an excellent example of how government can spend a little to save a lot. She points to a New York Times report on the success of a Massachusetts program that uses Medicaid to deliver stop-smoking treatment. In two and a half years, Massachusetts got 30,000 poor residents to kick the habit. That's 30,000 people charging fewer heart attacks, asthma attacks, and childbirth complications to Medicaid. Nationwide, says NYT, 11% of Medicaid spending, $22 billion, goes toward smoking-related illnesses.

States have a big pot of money—$25 billion in tobacco taxes and the $246 billion tobacco settlement from 1998—to spend on tobacco prevention. Unfortunately, according to the Campaign for Tobacco-Free Kids, the states are spending only 2.3% of their tobacco tax revenues on programs to help folks kick the habit. For every meager dollar the states do spend in that direction, the tobacco industry spends $20 to promote more smoking. (Ah, the free market, always working for the common good....)

South Dakota is doing better than most states, ranking tenth on CTFK's scoring of state effort on tobacco prevention. Our current budget allocates $6 million for anti-tobacco programs. Alas, that's not quite 53% of what the CDC recommends we should be spending. Our neighbors in North Dakota are the only state meeting that standard, spending $9.4 million on anti-tobacco programs, narrowly exceeding the CDC's recommendation.

South Dakota, like most states, is siphoning off the tobacco settlement funds to avoid making tough choices in other budget areas. The Republicans in Pierre voted for a budget this year to transfer the entire education enhancement tobacco tax fund to the general fund. The first $30 million of our cigarette tax goes straight to the general fund, and a sizable portion of revenue above that goes to property tax reduction instead of targeting tobacco use. Governor Rounds's FY2011 budget includes a $461,000 increase in tobacco prevention funding, but that's all federal stimulus money.

Governor Rounds has identified Medicaid as one of the areas driving big cost increases for our state budget. Maybe he should look at pulling some of the tobacco tax fund back to prevention programs. CTFK notes that California has spent $1.8 billion over 15 years on the nation's longest-running tobacco prevention program. That investment has produced savings of $86 billion in health care costs for everyone in California. Hmm... show me another program that produces a 50-to-1 return on investment, and you've got my vote.

First SD Legislature Bills Include Nickel Gas Tax Hike

Start your engines! The first bills of the 2010 South Dakota Legislature are online! Among the highlights, Senate Bill 1, "An Act to increase certain registration fees and taxes for the use of motor vehicles on the public highways and to declare an emergency." The most widely shared increase is a nickel hike in the gas tax. Licenses on any motor vehicle over 2000 pounds go up (Smart cars, anyone?). Folks with motorcycles, trailers, and motor homes would also pay more for their licenses. (Expect opposition from Madison's MyDakotaAddress.com and other businesses making money on the manufacturing of fake South Dakotans.)

My favorite socialist neighbor Gerry is sponsoring this one, as are Senator Merchant and four other Dems, but this bipartisan bill has the backing five good Republicans as well, including Rep. Krebs. These are the same folks from the interim highway committee who showed some political leadership last October in voting to advance this plan. These legislators take the seemingly reasonable position that South Dakota can't rely on Uncle Sam for every penny of highway funding.

As we gear up for the anti-tax hyperventilation from various quarters, let's remember what Rep. Vehle said at the October 14 hearing:

Everyone in this committee.. has a feeling that we need to do something... We'd all like to do probably a lot more than we feel in a recession we can do. But we need to take a hard look and be ready to explain to our colleagues the need that our highways have.... [A]ny society that lets its infrastructure fail or start to fail is also going down a wrong road and putting our society in jeopardy [Senator Mike Vehle, 2009.10.14].

Do you want to pay for the road you take to work? Or do prefer to put that money toward new struts as you go bouncing over the potholes?

Keystone XL Pipeline Unnecessary -- So Says Competition

Meet South Dakota's new friend in Big Oil Canada: Enbridge Inc. South Dakota Tar Sands Pipelines points to news that Enbridge argues competitor TransCanada's proposed Keystone XL pipeline across western South Dakota is unnecessary:

But TransCanada Corp.'s application for its 500,000 barrel-per-day Keystone XL line connecting Alberta to southern U.S. refineries is too much, especially after both Enbridge and TransCanada have recently built new pipelines to bring Canadian crude to the U.S., Mr. Daniel said.

"We're going to have more capacity than we need for some time. XL would add incremental capacity to that," he said. "I just don't know where the volume is going to come from based on current production forecasts."

Enbridge has fought TransCanada's application for the 3,200-kilometre long XL line on the grounds that it isn't needed and that its construction could raise pipeline tolls on oil sands exports. TransCanada has argued before the National Energy Board that oil producers have made it clear they want Keystone XL, based on the large volume of contracts they have signed. The NEB is expected to rule next year [Nathan Vanderklippe, "Enbridge Warns of Pipeline Overcapacity,"Globe and Mail, 2009.12.18].

Did you catch that part about increased pipeline tolls? Add that to what SDTSP mentions about all the debt service TransCanada will pass on to us, and you have a recipe for oil and gas prices that really won't go down much.

When we've given up our land rights to a foreign corporation only to see zero benefit in the price at the pump, don't come crying to me.

Side note: According to the same Globe and Mail story, Enbridge is also increasing its investment in wind and solar power.

SDN Gets $20M Broadband Grant; More to Come?

Here's more federal handouts for the Republicans to send back to Washington... oh, wait: South Dakota Governor Mike Rounds and his administration are pleased to announce that South Dakota is one of 17 states to receive stimulus money in the first round of rural broadband grants announced yesterday by Vice-President Joe Biden. SDN Communications will get a $20-plus-million grant to run 359 miles of new fiber-optic cable around the countryside.

Alas, no good news in this first round for Sioux Valley Wireless, Dakota 2000, and nine other South Dakota groups that bid for a chunk of that stimulus money to build some cool rural broadband projects. But sit tight: VP Biden's announcemenent yesterday marked just the $182-million tip of a $2.5-billion broadband iceberg of stimulus money to get the 'Net out to rural areas...

...unless of course the Tea Party can rise up with some candidates next year to "take America back" (to the sod houses and smoke signals?) and send all this evil federal money back to Washington.

MDL Publisher Sends Mixed Messages on Eminent Domain

Madison Daily Leader publisher Jon Hunter still "lives with his contradictions intact." In his Tuesday editorial, Hunter lauds Representative Stephanie Herseth Sandlin for her sponsorship of H.R. 4288, legislation intended to negate the ills of the 2005 Kelo v. New London decision on eminent domain. Hunter apparently agrees with me that Kelo was one of the worst Supreme Court rulings of the past decade. He cites this press release from SHS:

"The Supreme Court decision in Kelo v. New London dealt a serious blow to the fundamental rights of the private property owner," said Rep. Herseth Sandlin. "In essence, the ruling means that governments can take your property and give it to someone else for private use. This was a dangerous precedent when the case was first decided and it remains a dangerous precedent that deserves congressional action" [quoted in Jon Hunter, "Property Rights Would Regain Some Stature If Bill Passes," Madison Daily Leader, 2009.12.15].

What Hunter fails to explain—and what would make an interesting follow-up editorial, or a discussion in the comment section beneath his editorials, if his newspaper website had one—is how his apparent revulsion at the prospect of eminent domain fits with his expression of support of the Keystone pipelines. Hunter rejects the use of eminent domain for private use, yet he never mentions TransCanada's resort to eminent domain for the construction of its private pipeline. In his November 23 editorial, he relegates eminent domain to a blithe subordinate clause referring to "challenges with acquiring rights of way."

So which is it, Jon? Is eminent domain for private use always bad? Is it o.k. for Big Oil? Or is it just another meme to signal your allegiance to the big business crowd?

Rounds Budget: Living in the Now

Let's take a spin at the latest Madville Times poll. The question: "Do you approve of Gov. Rounds's proposed state budget?" Your answers:

• Yes: 5 (8%)
• No, spend more: 30 (54%)
• No, spend less: 21 (38%)

Choose your interpretation:

1. The anti-Rounds line: More than 90% of South Dakotans think Governor Rounds has failed to submit a budget that meets the needs of South Dakota.
2. The pro-Rounds line: When nobody's satisfied, you've obviously found the perfect compromise.
3. The Tea Party line: Nearly a majority of South Dakotans agree that we shouldn't have bigger government! We're on the way to victory!

My line: If I were Dennis or Scott or Scott, I'd be torqued. Governor Rounds is living in the now and kicking the can down the road to whatever real statesman (or kamikaze pilot) takes the reins in Pierre in 2011.

Now maybe I should go easy on the Governor. I appreciate the point Governor Rounds made in his budget address that his proposed budget gets us through another year of recession with our budget reserves intact.

The problem is, that's about the only gift he's leaving the next governor and the 2011 Legislature. The proposed budget is an act of abdication, not leadership. Governor Rounds offers no new ideas or significant changes in how the state does business that might lay the groundwork for a lasting local solution to the big budget shortfall we face after we've spent all the federal stimulus dollars. (Boy, for all his erstwhile grandstanding, Governor Rounds sure seems glad to have Uncle Sam bailing out two budgets in a row.) His plan is all increasing one big tax (freeze the levy instead of the usual reduction that offsets increased valuation), hoping the recession will end and sales tax revenues rebound, and shifting the hard work of raising education dollars to more local boards who will have to opt out to keep pace with costs.

Even his pay freezes for state employees put the 2011 Governor and Legislature in a tighter bind. Sure, freezing pay makes some business sense, but another year of no raises makes it that much harder for the next administration to go to that trough for more budget savings.

The responsible thing to do would be to put a budget fix in place now that doesn't just get us through the recession but gives the following administration more options for meeting everyone's needs. Unfortunately, the Rounds administration appears content to dodge the bullet and let someone else make the hard choices.

Madison Sunshine Expands Booze Sales... to Minors?

Sometimes irony is elusive. Sometimes fate dumps it in your lap.

On Tuesday, Madison grocer Dan Roemen told KJAM that he plans to use the old Mr. Movies store to expand his liquor selection. Tonight, MDL reports Roemen's Sunshine Foods failed its alcohol compliance check last Friday. Says the Leader, "Staff at Sunshine Foods completed a sale to a minor, allowing the underage purchase of alcohol."

Also worth noting: MDL lists 17 other businesses that sell alcohol in Madison. Assuming Roemen doesn't lose his alcohol license for his store's violation this month (dream on), that's 18 places to buy alcohol in a town of 6500 people.

Oh, did I mention...

Neighborhoods that are characterized by extremely high outlet densities may experience a variety of problems resulting from the presence of the outlets themselves, only partially related to levels of consumption. There is evidence that high alcohol outlet density contributes to increased crime and violence, youth violence, homicide, and other public nuisance and illegal activities [Marin Institute, 2006].

...and...

The level of drinking, drinking participation, and participation in binge drinking are all significantly higher among all college students when a greater number of outlets licensed to sell alcoholic beverages exist near campus. This is particularly true for underage drinking. [Chaloupka, F. & Wechsler, H. “Binge drinking in college: the impact of price, availability and alcohol control policies.” Contemporary Economic Policy, vol xiv, October 1996.]

...and...

Over-concentration of alcohol outlets is part of neighborhood economic and social disintegration. The area's economic base loses its diversity and becomes less attractive to both residents and potential retail customers. The proliferation of alcohol outlets is thus both a symptom of economic decline and a factor that worsens the decline. [Maxwell, A. & Immergluck, D. “Liquorlining: liquor store concentration and community development in lower-income Cook County (IL) neighborhoods.” Chicago IL: Woodstock Institute, 1997.]

...and for the family values crowd (i.e., all of us)...

By using spatial models, PIRE researchers have examined the availability of alcohol, (most often measured as alcohol outlet density per geographic region such as census tract), as a factor related to drinking and driving, binge drinking, child abuse and neglect, accidental injuries, and violent assaults. Some findings from this research include that higher on-premise alcohol outlet density (such as bars) are associated with greater drinking and driving, child neglect, and assaults whereas, higher off-premise (such as liquor stores) alcohol outlet density are associated with higher child physical abuse, and injuries from accidents, while both types are associated with more problem drinking such as binge drinking [Pacific Institute for Research and Evaluation, "Alcohol: Crime and Violence," 2006].

Seems to me it's time for Madison to do something Unexpected™ and make a real stand for public safety and economic diversity: yank Sunshine Foods' liquor license. Keep the Mr. Movies space open to a difference, better kind of business.