Manufacturing continues to slide in the Great Lakes. Especially in Wisconsin

Manufacturing continues to struggle in America in light of the trade wars and a generally maxed-out economy. And that’s especially true in our segment of the country, as shown by a disappointing report from Monday.

A measure of business conditions in the Chicago region contracted for the third time in four months, reflecting ongoing struggles by American manufacturers as well as the two-week-old General Motors workers strike.

The Chicago PMI business barometer dropped to 47.1 in September from 50.4 in the prior month, MNI Indicators said Monday. Any reading below 50 indicates worsening conditions…..

The barometer averaged 47.3 in the third quarter, the lowest level since the U.S. exited recession in the middle of 2009.
What happened: Production in the Chicago region sank to a 10-year low, but the decline was exaggerated by the strike at GM.

Even if the strike is set aside, however, the report showed broad weakness. The backlog of orders and inventories also fell sharply.

Even closer to home, southeast Wisconsin is falling even further behind in the manufacturing.

The Milwaukee-area manufacturing sector contracted for a third straight month in September, according to the latest Marquette-ISM Report on Manufacturing.

The report’s Milwaukee-area PMI registered 45.41 in September, down from 47.29 in August. Any reading below 50 suggests the industry is contracting. The index was also below 50 in July and May. It is the first time the sector has seen a prolonged negative streak since a nine-month stretch in 2015.

The index has been below 50 in four of the last five months and its six-month average has now dipped below that threshold….
Production, employment, customer inventories, backlog and imports all dropped and were in negative territory in September.

Blue-collar employment in particular saw a sharp fall, from 57 in August to 45.2 in September. Some respondents said companies are exploring a temporary layoff of blue-collar workers while others noted company owners were keeping staffing steady to retain an effective team.

This is reflected in Wisconsin losing jobs in the sector for 2019, despite having the WisGOP Legislature retain a tax cut for manufacturing businesses that is projected to cost $307.5 million in this fiscal year.

These bad reports might help to explain why the Philadelphia Federal Reserve bank has Wisconsin as the Midwest’s answer to “one of these things is not like the other” for state economies in August 2019.

At both the state and federal levels, the major tax breaks given to these businesses are not translating into the large-scale job and wage growth that GOPs claimed it would. Maybe it’s time we stop giving away the farm to these corporations, and instead empower workers in those businesses.

This can be done not only through encouraging workers to have more representation when it comes to business operations (worker boards and/or unions having a role in state policy comes to mind), but also by expanding the safety net so corporations cannot use benefits as a cudgel to discourage wage demands and job security (like in the GM strike).

So far, the slowdown in the Midwestern industrial economy hasn’t crossed over into a full-scale recession for the rest of the country. But it’s also not what Donald Trump promised blue-collar those “real Americans” when the manufacturing economy last stagnated in 2015 and 2016. And what would develop over the next year to stop the bleeding for those industries, as prices for goods keep falling and wages continue to stagnate?

Good luck running on the economy in these parts in 2020, GOPs.

Consumer spending has kept us afloat, and it slowed down in August. Now what?

The main thing that continues to carry this economy forward is consumer spending by everyday Americans, which is why the monthly income and spending report by the Commerce Department is a key indicator as to whether the 10-year-long expansion is going to have an 11th year.
That report came out late last week, and it was a mixed bag that indicated the expansion was slowing, but still continuing.

Personal income increased $73.5 billion (0.4 percent) in August according to estimates released today by the Bureau of Economic Analysis. Disposable personal income (DPI) increased $77.7 billion (0.5 percent) and personal consumption expenditures (PCE) increased $20.1 billion (0.1 percent).

Those consumption expenditures are pretty soft, and June and July’s figures for consumption had that growth revised down by a total of $28 billion, putting August’s total consumption lower than what July’s was originally reported as.

That’s not the right direction, to be sure. And when adjusting these totals for inflation, you can see that consumption growth has steadily shrunk over the last 6 months measured.

What’s interesting is that the Atlanta Fed has upped its estimated growth for the 3rd quarter in the last few days, now at 2.1%. vs 1.9% last week. This is even with that same report lowering the contribution of GDP growth due to consumption by 0.3%.

Why? Part of it is strength in the housing market, which had a nice rebound in August after interest rates dove during trade war and recession concerns came to the forefront.

Sales of newly-constructed homes in the U.S. increased 7.1% on a monthly basis in August to a seasonally-adjusted annual rate of 713,000, the government reported Wednesday.

That’s up from a revised rate of 666,000 in July, and is just shy of the 12-year high set in June. Compared with August 2018, new-home sales were up 18%...

This summer’s decline in mortgage rates continued to be the gift that keeps on giving. Low mortgage rates were already shown to have sparked a major uptick in home-building activity in August, and sales of new homes naturally followed. “U.S. housing market activity is responding positively to lower rates, another reason why the U.S. economy doesn’t need the extent of interest rate cuts that are priced into financial markets currently,” said Katherine Judge, an economist at CIBC Capital Markets.

It’s worth noting that those interest rates have taken back a lot of their decline in September, so let’s see if home sales go back down in reaction.

The other reason for the Atlanta Fed’s higher Q3 growth estimates isn’t so good. It’s because inventories are growing again, by $3 billion for wholesalers and $1.3 billion for manufacturers. If consumer spending continues to slow and those inventories continue to grow, I can’t think many businesses will be avoiding larger amounts of layoffs and other cutbacks before long.

I’m not going to say that August’s figures are a major warning sign of recession. But it does indicate that things continue to soften as 2019’s second half proceeds, and if September shows further slowing, the sputtering of this economy has to start spreading over into a more widespread issue.

This week’s job report likely won’t show losses, and we haven’t seen a growth in jobless claims yet. But how much longer can that go on as other areas of the economy stall out?

Medicare for All too "costly?" It's cheap vs what people and business will pay in 2020

Some not-good news hit the wires this week as open enrollment season begins. It looks like health insurance costs will continue to go up in 2020.

Large companies predict the total cost of workplace health-care coverage to reach an average of $15,375 next year, according the National Business Group on Health. That’s up from $14,642 in 2019.

This figure combines workers’ and employers’ spending on insurance. Employees are expected to shoulder about $4,500 in costs next year, including out-of-pocket spending, the group found.

The organization, which represents large employers’ perspectives on health-care policy, polled 147 large employers to get their perspectives on health-care trends….

Those workers paid a total of $7,726 in 2018. Of that, $3,020 came from cost-sharing, including deductibles, coinsurance and copayments.

“Employer premiums are going up; they pay more each year,” said Cynthia Cox, vice president at the Kaiser Family Foundation. “But so do the employees and their families.”

Also, it’s not just active workers that might get squeezed more in 2020 due to health care costs. Note this article, which mentions that not only are seniors likely to have a lower cost-of-living adjustment (COLA) for their Social Security checks, but they’re the ones that are paying much higher prices for their drugs and other health services.

The 1.6% adjustment would amount to roughly $23 a month for someone receiving the average retirement benefit of $1,460, Johnson said. COLAs have been averaging 1.4% over the last decade, half of the average 3% it was between 2000 and 2009. Last year’s COLA was the first big hike since 2012, when it was 3.6% (in 2018, COLA was 2%, and in 2017, it was 0.3%).

But the significant drop in COLA between 2019 and 2020 may not be the worst part. Social Security as it stands bases its adjustment on CPI-W, the consumer-price index and buying patterns of younger workers. But young workers and retirees don’t spend their money the same way. “They will spend less on health care and perhaps housing, and those are the two expenses that really make a difference for older Americans,” Johnson said. Young workers might spend between 7% to 10% of their money on health care, compared with older Americans, who can expect to spend 12% to 25% on it, she noted.

But Medicare for All will be “too costly” for people because it raises taxes? Those few extra dollars in taxes seems small compared to the $15,000 employers are paying, and $4,500 that their employees are shelling out for.

If Acela-corridor journalists want to ask proponents of Medicare for All or similar single-payer plans "How will you pay for it?", they're looking at it the wrong way. Our economy and everyday people are paying higher prices under the current system today, especially those in the middle and upper-middle classes, because they are less likely to have insurance through Obamacare exchanges, or to get much of their Obamacare insurance written off through tax credits.

And I can't see it getting much better for the old or the employed over the next 2 years as the economy slows and corporations find reducing health benefits might be a good source of "savings" by offloading the cost onto workers and seniors. This needs to be hit hard by electoral candidates over the next 13 months, because those concerns are real.

A reminder, Wisconsin plays big with NRA-Russia-GOP laundering and favor-trading

When the Mueller Report dropped earlier this year, I wrote a sizable piece showcasing all of the connections that the Trump-Russia-NRA axis had to Wisconsin. This included this memorable tweet from a now in-hiding David Clarke.

Red Square near the Kremlin with a Russian officer. Met earlier with Russian Foreign Minister who spoke on Mid East. pic.twitter.com/ZcDdQB65lb

— David A. Clarke, Jr. (@SheriffClarke) December 10, 2015

We also knew that now-convicted Russian spy Maria Butina and Russian oligarch Alexander Torshin were hanging out with Scott Walker at the NRA convention in early 2015. Why do I bring this up again today?

BREAKING: A new Senate report reveals that the @NRA was a 'foreign asset' to Russia ahead of 2016, promising access to U.S. officials in exchange for Russian business. https://t.co/hOai6sBXzB

— Shannon Watts (@shannonrwatts) September 27, 2019

Here's a news summary of the report, which came as part of an investigation set up by Sen. Ron Wyden.

The report indicates that top NRA officials were aware of Butina's and Torshin's links with the Kremlin even as they sought to work more closely together under the banner of gun rights.

In an email later circulated to two senior NRA staff members, Butina wrote that a purpose of the 2015 Moscow trip was that "many powerful figures in the Kremlin are counting on Torshin to prove his American connections" by showing he could bring prominent NRA officials to Russia....

It was a explicit interest expressed by Butina: In one 2015 email to an NRA employee, Butina wrote, "is there a list of U.S. governors or members of Congress that might be present at some time during the [NRA] annual meeting?"

The employee responded with a list.

The NRA also helped them forge connections with groups such as the Council for National Policy, the National Prayer Breakfast, the National Sporting Goods Wholesalers Association and Safari Club International.

"NRA resources appear to have been used to pay for membership and registration fees to third party events for [Torshin and Butina] as well as to arrange for transit to and lodging for many of those events throughout 2015 and 2016," the report states.

Wow. Seems like something Senate Homeland Security Chair Ron Johnson should be looking at, especially with this week's revelations of how President Trump was shaking down Ukraine (and others?) to have them help his electoral prospects in exchange for US tax dollars in aid.

But RoJo doesn't seem too interested, and is instead concentrating on - Joe Biden, Biden's family, and Hillary Clinton?

One early divide among Senate Republicans is between the “Burr camp” and the “Johnson camp,” according to two senior GOP aides who were not authorized to speak publicly, referring to Sen. Richard Burr (R-N.C.), the chairman of the Senate Intelligence Committee, and Sen. Ron Johnson (R-Wis.), the chairman of the Homeland Security Committee.

Burr’s faction of the Senate GOP has a darker, frustrated view of Trump’s handling of Ukraine, while Johnson has linked the Ukraine issue to his committee’s work into reviewing the launch of the FBI investigation into Hillary Clinton’s emails while serving as secretary of state.

During a closed-door Senate Republican lunch Tuesday, both Burr and Johnson underscored their own position in conversation with colleagues, who asked them whether their respective committees would launch investigations of Biden.

Huh. It's almost like Ron Johnson is (ab)using his power as a committee chair to avoid talking about how President Trump is compromising American interests and intelligence through his corrupt dealings with foreigners. Why would he want to avoid that.

You don't think it has something to do with Ron Johnson being a major recipient of possible illegal GOP/NRA coordination in his 2016 election, do ya? Or that RoJo is more than fine with the same type of money-laundering and propagandizing of Wisconsinites happenijng in 2020 and 2022 as long as it helps him, Donald Trump, and the rest of the GOP? NAAWWWWW!!

New Census report shows Wisconsin incomes fell further behind in 2018

Wanted to pass along this note from this week's Census release on median household incomes for states and large communities.

Wisconsin’s real median household income barely budged in 2018, increasing $221 to $60,773 (0.36%) – not even $20 a month. This placed Wisconsin 31st for household income growth in 2018 out of 49 states measured, and only Iowa did worse than us in the Midwest.

Real median household income growth, 2018
Ohio +1.58%
Mich +1.10%
U.S. +0.84%
Ill. +0.83%
Ind. +0.68%
Minn +0.38%
Wis. +0.36%
Iowa -0.08%

The fuller briefing also has records of state income going back to 2005, and it shows that Wisconsin’s real median household income peaked in 2007 at a level similar to the U.S’s. Both areas fell as the Great Recession took hold afterwards, but the US has rebounded quicker over the last 6 years, to the point that Wisconsin’s household income was now more than $1,100 below the country’s level by the end of last year.

(ALL FIGURES IN 2018 DOLLARS)

So unlike the country as a whole, Wisconsin's real median household income still has yet to rebound to where it was 12 years ago. And the gap has gotten notably larger in the last 3 years.

Go ahead WisGOP, take "credit" for Wisconsin's substandard performance since you started cutting taxes and gutting unions in 2011. It helps explain why Dems swept every statewide race last November, and why Trump isn't going to be able to run on a "strong economy" in the states that he needs most.

WisGOPs say they cut your taxes! Aren't you grateful?

Oh, I see that Robbin’ Vos, Scott Fitzgerald and others are talking about all of the taxes that have been cut in our state since 2011.

The cumulative effect of Republican tax cuts has grown to $13 billion in 10 years. This is good news for hardworking Wisconsinites. https://t.co/y9ZfWfLHoQ

— John Nygren (@rep89) September 26, 2019

So don’t you feel notably richer in Wisconsin with all of these lower taxes? NO?

There’s a good reason why. Because if you look at the Legislative Fiscal Bureau memo that the WisGOPs cite, many of the dollars from those tax breaks didn’t give you more money in your paycheck. Instead, they went to the rich and corporate, or were shell games that bought down property taxes by spending more state tax dollars.

Top “income tax cuts”, 2011-2019
Net funding shift to pay off Tech College property taxes $2.65 billion
2013 income tax cut $2.57 billion
Increase K-12 school funding, but don’t increase revenue limits $2.01 billion
Manufacturers/Ag Credit (minus interactive changes) $1.86 billion
2014 income tax cut $677.6 million
2019 income tax cuts $440.8 million
Capital gains deferrals/exclusions $436.1 million
Repeal forestry property tax $383.7 million
Repeal combined reporting for corporations $366.4 million
Increase lottery tax credit with state tax dollars $311.6 million
EVERYTHING ELSE $1.41 BILLION (over 10 years).

And let's talk about the real costs that have resulted from all of these tax cuts. Schools and universities defunded, along with much of those property tax "cuts" being removed after those communities had to pass referenda to keep their schools operating well. We have Scottholes all over the place that make us pay more to catch up on the deferred road repairs, and a tripling in wheel taxes between 2011 and 2017 (with more added since then) because local governments have no other options to keep functioning.

The passing down of taxes and fees to the local level is conveniently not part of the LFB's study, or WisGOP's talking points. And it’s not like our economy boomed as a result of these lower taxes. In fact, it’s pretty clear that Wisconsin was held back from feeling the full benefits of the US expansion during the Age of Fitzwalkerstan.

Not exactly much bang for the buck. And now we are so overextended with these shell games and cumulative tax cuts that when the next economic downturn comes (likely sooner than later), the spending side doesn’t have anything that can be cut back on without serious consequences....outside of the shell games that account for much of these "tax cuts," I suppose. That may be what the ALEC Crew wants, to force Evers and others Dems into a "tax increase vs dysfunction" choice, and lead to a privatizing government services. But it’s not something that the typical Wisconsinite will like, nor should they accept.

As usual, Dems are going to have to make the more legitimate choices to clean up from the GOP recklessness that has messed up this state. And it needs to happen sooner than later, to limit the pain that'll be coming from the adjustments to reality that will have to be made.

They're packing them in at UW-Madison, especially if they're from out of state.

Saw this headline in recent days, and I can't say I'm surprised.

Wisconsin residents make up a bare majority of freshmen at UW-Madison this year, the smallest percentage of in-state students the university has enrolled in at least 25 years.

The incoming class includes a record-breaking 7,550 students, 50.3% of whom are from Wisconsin.

That’s a 3.1-percentage-point drop from last year’s incoming class and an even steeper decline since the late 1990s and early 2000s, when two out of every three freshmen were Wisconsin residents, according to a Wisconsin State Journal analysis of enrollment reports.

While the State Journal concentrates on the higher proportion of out-of-state students, both of those numbers are telling to me, and they're a direct result of 8 years of anti-UW policies put together by WisGOP in the Age of Fitzwalkerstan.

Since Scott Walker and the GOP came to power in 2011, the UW System has faced several cuts in state funding, while having in-state tuition frozen since 2013 as part of a Walker PR stunt. UW PoliSci professsor Mark Copelovitch notes how these choices along with tax cuts put the squeeze on public universities.

The public university trilemma for politicians:

1. Maintain academic excellence/reputation
2. Maximize in-state student %/minimize tuition
3. Continue reducing state funding to finance tax cuts

Choosing 2 & 3 reveals preferences for sacrificing 1. Quality requires investment. https://t.co/emCxbOO1TE pic.twitter.com/IzGDgkiaDK

— Mark Copelovitch (@mcopelov) September 25, 2019

Since UW-Madison can't add money by raising in-state tuition either, what do they do if they want to have enough resources to adequately compete at a top level? Have more people attend the school, and have more out-of-staters who pay higher tuition. And that's precisely what's happening here.

Interestingly, the State Journal adds that Bucky still has an increasing number of in-state freshmen, even in a time when fewer Sconnies are graduating from high school.

But looking at raw numbers, the 3,797 students from Wisconsin represent the second-largest number of resident students in the last decade and the fourth-largest in the last 30 years.

Complicating the admissions puzzle is the state’s declining number of high school graduates. There are 13 University of Wisconsin System campuses across the state, along with dozens of private institutions, all of whom are competing to recruit a shrinking pool of in-state applicants.

It's down, but it's up!

But Madison has the name recognition and outside donors to survive budget cuts. It's a very different story at other, smaller UW schools, such as UW-Stevens Point, who threatened to cut massive amount of majors and programs last year in light of declining enrollment, and the demographic decline in Wisconsin HS graduates isn't going to make that any easier for the future for many UW System schools.

Some schools are getting by as 2019 starts, as the Daily Cardinal tells us that in addition to Madison, La Crosse, Stout and Eau Claire all have reported increases in new freshmen this year. But relying on "packing kids in" to the campuses doesn't seem like a long-term strategy to follow.

The obvious answer is to have the state stop shirking on its share of funding. But WisGOPs were unwilling to do that during budget deliberations, taking out over $100 million in proposed funding that Governor Evers set aside to fund the tuition freeze and to improve student services on campus.

So if that's not an option, perhaps it's time to change strategy where tuition is allowed to rise (at least at Madison, which clearly has high demand), but more financial aid is offered to in-state students to make it easier to attend UW schools or the state's tech colleges. That would at least allow the UW schools to have the resources to adequately compete for talent, and possibly make an easier adjustment to the changing needs of students and technology.

But until that happens, it seems likely that schools like UW-Madison will try to have more Coasties and others who pay above the in-state tuition rate. Although I complete understand why more people would want to attend college in an amazing place like that.

But I also have fears about UW becoming more of a playground for rich kids. And if out-of-state freshmen topple over 50% next year, I don't want to hear a thing from WisGOPs about "elitist Madison", because it was their budget cuts and their constraints on in-state tuition that helped lead to the situation.

Evers gives a date voters replace Duffy, and WisGOPs complain because...it happens too soon?

Today was Sean Duffy's last day in Congress, and our Governor wasted no time in setting up a date to get a new person in DC to represent the 715.

Gov. Tony Evers today announced that he will order a special election to fill the 7th Congressional District vacancy created by the resignation of U.S. Rep. Sean Duffy (R-Wis). The election will occur on January 27, 2020. A primary, if required, will occur on December 30, 2019.

The governor has received notification from Mr. Duffy stating Mr. Duffy will resign the office of U.S. Representative, effective Monday, September 23, 2019, at 6:00 p.m. EST.

State law dictates when the governor can order a special election. Once a congressional seat becomes vacant, the governor can order a special election. Gov. Evers will issue an order for the special election immediately following the effective time of Mr. Duffy’s resignation.

“Our rural communities have been directly affected by unproductive trade wars, political attacks on healthcare and public education, and economic uncertainty because of the volatility we’re seeing in Washington, D.C.,” said Gov. Evers. (Was that necessary, Tony?) “The people of Wisconsin’s 7th Congressional District deserve to have a voice in Congress, which is why I am calling for a special election to occur quickly to ensure the people of the 7th Congressional District have representation as soon as possible. I thank Rep. Duffy for his service and wish him and his family all the best."

I had mentioned back when Duffy announced his return to the real world that my preference was for the primary to be in mid-January and the general election on the same date as the statewide primary for Supreme Court in February, partly as a cost-saving measure for the locals in the Northwoods.

But apparently Evers wanted to fill the seat as quickly as possible, which is NOT what the Republican Party of Wisconsin wanted.

The Wisconsin GOP is calling foul on Evers’ choice for the date of the election. #WI07 pic.twitter.com/cIUNxm2vDE

— Aaron Booth (@ActorAaronBooth) September 23, 2019

I get that WisGOP will whine about anything Evers does. But where's the logic behind this release? "Shield his party from rural voters?" WTF does that even mean? If Evers wanted to do that, he wouldn't have called the election at all and would have waited till November 2020 to fill the seat, like what Republican Governor Scott Walker tried to do with 2 seats in the State Legislature last year. At least until Eric Holder handed Walker his ass in court.

But Evers isn't a scumbucket like Walker, and wanted to get the seat filled quickly, so the people of WI-7 would their voice restored to the House sooner than later. Maybe there's a legitimate point in that the end of the year and end of January has more people in local government offices to pay their property taxes, but those places usually aren't open at 7am (when polls open) or at 8pm (when polls close). In addition, are most of the polling spots at the same place people pay their taxes? I doubt it, so that's a pretty soft angle to criticize.

No, what WisGOP is complaining about is that Evers wouldn't keep the seat vacant for an additional 2 1/2 months, so that the WI-7 election would have happened at the same time as the Supreme Court election, the presidential primaries, and other Spring elections in April 2020. I guess that's because in their minds this would help right-wing nutjob Daniel Kelly stay on the court by having more people vote in a pro-GOP district. Apparently that was so important to WisGOP, the party that claims to speak for the "real Wisconsin" in the sticks, that they wanted the Northwoods to not have a person representing them in the House for 6 1/2 months!

That's telling to me, because it shows how GOPs only think in terms of electoral gaming when it comes to things like filling a seat in Congress. There is no concept of a greater good or improving access for voters, and if the shoe was on the other foot, WisGOP wouldn't give a damn about whether the timing of an election coincided with property tax payments or if a primary election was close to New Year's. They certainly haven't cared about giving local governments enough funding or flexibility to operate effectively over the last 8 years.

Their act is pathetic, but I shouldn't expect any less from a WisGOP that has completely given up on trying to be an honest broker. Anyway, let's see what landscape develops in this rare special election for Congress in the Northwoods. Normally, you'd figure this would be a GOP hold, but given the volatility in DC and the economy these days, I don't have an idea how people might be feeling in 4 months.

Fitz wants a tax cut. Problem - there's no money to give back

Now that Wisconsin Senate Majority Leader Scott Fitzgerald is trying to become Congressman Fitzgerald in the 2020 elections, he’s bringing out this GOP standby.

Senate Majority Leader Scott Fitzgerald is floating the possibility of a new tax cut as he launches a campaign for a seat in Congress representing the deeply conservative 5th Congressional District.

Fitzgerald said in an appearance Sunday on WISN (Channel 12) promoting his run for Congress that if the state has enough socked away he would like to put Wisconsin families "in a much better position" through a tax cut.

"I think we're going to be able to do it," Fitzgerald said.

State lawmakers are set to see $753 million more in tax revenue than previously anticipated. Democratic Gov. Tony Evers and one of the GOP leaders of Legislature's finance committee have said most if not all of the unexpected windfall should stay in the state's rainy-day fund.

Tax cuts? AGAIN?

I read that, and it didn’t add up to me.

That's because the “$753 million more in tax revenue” was known in May, as the state budget was being deliberated. After those new revenue projections were given by the Legislative Fiscal Bureau, both the Legislature and Governor Evers promptly took care of that extra money, partly by giving income tax cuts that reduced revenues by a total of nearly $330 million over the next 2 years via the budget and a measure dealing with online sales.

In addition, more expenses were added to the budget in a variety of areas, which took care of most of the rest of the extra revenues. In fact, the State Budget gets rid of pretty much any extra money that might exist under those projections over the next 2 years (as shown on Page 41 of this document).

Projected balances, 2019-21 budget
Opening balance FY 2019-20 +$947.7 million
Closing balance FY 2019-20 +$792.3 million
Closing balance 2020-21 +$114.2 million
MINUS required reserves FY 2020-21 $85 million
TOTAL AVAILABLE $29.2 MILLION

Then it gets worse for the next budget, which has a projected structural deficit of more than $1.1 billion.

So there’s no extra money to be found, barring a major upside revenue boom (unlikely when the state has lost jobs in 2019 so far).

But wait, Fitz told “Up Front” that he thinks he has a source!

The state is expected to take in the additional revenue through the summer of 2021, giving lawmakers a small windfall as they work on the next state budget. Fitzgerald said Sunday he believes the rainy-day fund currently has $600 million in it.

Well, he’s right about the total, based on last month’s memo from the Legislative Fiscal Bureau.

As noted above, tax collections for 2018-19 are $75.5 million higher than the most recent estimate. Under s. 16.518 of the statutes, half of any excess of actual general fund tax collections in a fiscal year over the amount estimated at the time of enactment of the biennial budget must be deposited into the budget stabilization fund at the close of the fiscal year. Additionally, 2017 Act 368 directed that the amount of sales and use taxes collected in 2018-19 under the Wayfair decision be excluded from the calculation. Under these provisions, it is estimated that, for 2018-19, $321.7 million will be transferred to the budget stabilization fund….

The budget stabilization fund currently has a balance of $327.4 million. With the transfer shown here, that balance would increase to $649.1 million, plus whatever interest accrues to the fund.

Which is nice to have. But it’s a Rainy Day Fund, which is supposed to be used to maintain funding when budgets get tight when recessions lead to fewer revenues and more social spending needs.

So is Fitz saying he would blow through the state’s Rainy Day Fund to try to buy the votes of people who might vote in the WI-5 GOP primary? That’s a ridiculous and reckless move, especially given the precarious state of our economy these days. Sounds like our media should go back to Fitz and ask him to show us where he is finding this magic money that he would allegedly cut taxes with.

Because 5 minutes of research will tell you that there is no pot of money available to give back to taxpayers, at least not today. Which begs the real follow-up question – what services are getting reduced to come up with another GOP tax, and why would this make things any better in the state when 8 years of GOP tax cuts have left the state far behind in job growth during the Age of Fitzwalkerstan?

Wisconsin, other Obama/Trump states falling further behind as 2020 nears

Good luck seeing our “businessman president” sell the economy in the states he needs most in 2020 if this keeps up.

Two swing states narrowly won by President Trump in 2016 were the sites of the greatest losses in manufacturing jobs between 2018 and 2019, according to data released Friday by the Labor Department.

The agency's state employment survey found that Wisconsin has lost about 5,200 manufacturing jobs since August of last year. In Pennsylvania, losses of manufacturing jobs topped 7,700, according to the survey.

Wait, you mean a tax cut to the rich and corporate didn’t bring back factory jobs, and the WisGOPs keeping the M&A “Big Giveaway” to Wisconsin manufacturers didn’t spark a surge in hiring? Imagine that!

But it’s not just Wisconsin and Pennsylvania that are struggling in Big Ten territory (pre-Rutgers/Maryland edition), and it’s not just in manufacturing. That same state-by-state jobs report shows several other Obama/Trump states with job growth well below the US’s (declining) rate over the last year, along with an upper Midwest state that stayed blue, but that the Trump people targeted and nearly won in 2016.

US job growth Aug 2018-Aug 2019
US +1.39%
Iowa +0.80%
Penn +0.64%
Ohio +0.45%
Mich +0.36%
Minn +0.09%
Wis. +0.06%

In fact, Wisconsin ranks 49th in the nation for jobs over the last year, with only Louisiana trailing us (they were 3 years ahead of us in the category of “ALEC tire fire imposed by crooked fool of a governor”).

And the Philadelphia Federal Reserve's coincident index of all states backs this up. While part of the country continues to grow, which will likely keep the US economy out of recession for at least the next few months, that may not be true in the key states that DC media likes to talk about, but doesn't seem to understand much.

EDIT- And here's UW's Menzie Chinn reiterating that with an illustrative chart.

Memo from the Midwest: Industry and Agriculture under Trump -- pretty lackluster... no thanks to tariffs resulting and retaliation https://t.co/tSc4bZCKiU pic.twitter.com/IqBAX34VVo

— Menzie Chinn (@menzie_chinn) September 23, 2019

WisGOPs try to stir up NON-troversy on DAs that they caused

I wanted to riff a bit on a recent issue WisGOPs are trying to stir up regarding district attorneys. And it's important to know how we got here, and what the concerns are...and why they're largely BS.

In WisGOP's 8 years of complete control of state government from 2011-2019, they barely added any funding to counties to hire District Attorneys to prosecute crimes. This resulted in a major shortage in prosecutors, and delays in justice.

So in his first state budget, Governor Evers proposed adding state funding to support several more local district attorneys in Wisconsin (we require these places to have DAs, the least we can do is pay for them), and Republicans added many more positions and more funding as the budget was deliberated through the Legislature. But Republicans also specified where those DAs would be, and they were overwhelmingly in red-voting counties.

Evers used his veto pen to say "Thanks for the money, but I'll decide where those positions go." And then the Governor announced this week where the positions were. Republicans predictably whined.

My statement on Gov. Evers's decision to cut new prosecutor positions from rural counties to benefit Madison and Milwaukee.

"The plan the we passed as part of the budget came directly from a coalition of prosecutors who worked together for over a year using a needs assessment." pic.twitter.com/dvYeGRmv0A

— John Nygren (@rep89) September 17, 2019

Let's get to the numbers on this question.

The Legislative Fiscal Bureau’s budget paper on District Attorneys gives a great background on this, and not only does it show that a total of only 9 state-funded prosecutors were added in 2005-17,it also explains that some of these places are losing non-state funding for prosecutors, leading the state to make up the difference.

For example, Fond du Lac County still gets state taxpayers to pay for 2 more prosecutors, and the one that Evers “cut” seems to be a position that the federal Violence Against Women Act has been paying for. Instead, those duties will be absorbed by the current prosecutors in Fondy, and/or the 2 new prosecutors the state will now be paying for.

Marathon County is a similar story, where the DA’s office in Wausau lost VAWA funding in 2015. Combined with a county budget crunch, it had become difficult for Marathon County to continue prosecuting those cases, and also continue with specialty prosecutors that deal with restorative justice and OWI cases.

So basically Wisconsinites are picking up the tab to allow Marathon County to keep doing these prosecutions (which is fine, but let’s be real about this), and paying for an extra prosecutor on top of that. But apparently that’s not good enough for Wausau State Rep (and former talk show host) Pat Snyder.

“Time and again Governor Evers has prioritized Madison and Milwaukee over citizens in the rest of the state, and this decision is no different. Governor Evers has, once again, blatantly disregarded the needs of my community by making decisions that benefit his base at the expense of Marathon County. His administration’s allocation of these positions directly pulls one position that was assigned to Marathon County to make it available to Milwaukee and Dane Counties.”…

“In the past several weeks alone Marathon County has seen serious incidents of violence; continued escalation of drug-related crimes; and victimization of children,” Rep. Snyder added. “The additional 4.5 ADA positions in the Legislature’s budget were critical to ensuring that our law enforcement officers have the resources that they need to bring prompt justice for victims. The Governor’s reallocation is a step backward and a huge detriment to Marathon County.”

Hey Pat, Marathon County has added all of 2,300 people since 2010 while Dane County has added nearly 50,000, and we’re getting as many new full-time prosecutors paid for as you are. Stop whining, or allow more local governments more flexibility to raise their own money through a sales tax.

As for Milwaukee, that’s simply replacing positions that were funded in another grant, just like how state funding is replacing Marathon County prosecutors that were grant-funded.

The bill recommends the conversion of an additional 3.0 PR positions to GPR funding for the violent crimes unit in Milwaukee County. Funding is currently provided by a grant from the North Central High Intensity Drug Trafficking area and office of National Drug Control Policy. The Milwaukee County DA's office has been advised that the three positions will no longer be funded after December 31, 2019. These three positions are half of six ADA positions that provided legal assistance and advice in support of HIDTA initiative in order to help target drug trafficking organizations and violent gangs. The ADAs work with HIDTA officers during investigations including: drafting, reviewing and approving applications for search warrants, subpoenas for records, wiretap orders, and electronic surveillance orders, and prosecute criminal cases in state court. The ADAs help coordinate referrals for federal prosecution when that venue is more appropriate. In addition, HIDTA ADAs work to identify non-violent, low level offenders, whose criminal activity is motivated by substance abuse, in order to redirect them into alternatives to traditional prosecution.

The difference? GOPs on Joint Finance removed Evers’ plans to replace the funding in Milwaukee for those 3 positions, and 1 other funded by an outside grant. But the GOPs had no problem with Evers helping out Marathon County in the same way, so Milwaukee ends up with one FEWER prosecutor in total, and Marathon has 1 MORE. Funny how that works out.

This shows yet again two themes of the Wisconsin GOP.

1. GOPs don't really care about the amount of government spending. They care that their communities and their donors get the tax dollars.

2. They care more about playing political games with resentment than in being serious about handling a prosecutor shortage that they caused through 8 years of inaction.

Bucky's Big Blowout

Well this was how I spent my afternoon today.

That was a serious belting. And a whole lotta fun. Then the Crew kept on rolling tonight.

Much more pleasant and invigorating than the non-sports world these days, that's for sure.

And this out-of-towner from the Barstool Sports universe was definitely impressed.

Official Madison, Wisconsin Review: IT SLAPS DIFFERENT pic.twitter.com/DYh9a49dus

— Snacks Curry (@DoubleVodkaDon) September 21, 2019

Wisconsin work force, jobs, economy stagnating even more

A couple of reports out this week further illustrate that Wisconsin is acting like a state that has maxed out its economic abilities, in no small part because the state was unable to get people to want to come to Wisconsin during the Age of Fitzwalkerstan. And now it is leading to a legitimate concern as to where any future growth might be going.

The Wisconsin Policy Forum came out this week with an analysis that underscored the demographic problems that are hindering the state’s economy. In particular, the Policy Forum says there have been fewer working-age Wisconsinites as the 2010s have progressed.

After peaking in 2011 at 3.6 million, Wisconsin’s working-age population has receded by over 35,000 (or 1%) since, U.S. Census data show. In fact, the state’s working-age population has declined slightly in each of the last four consecutive years. (See Figure 1.) While relatively small, this string of losses re- verses a long-term growth trend and heightens concerns about the state’s future workforce.

Making matters worse, Wisconsin’s population of youth under the age of 18 —a key source of future workers—also has de- creased in recent years. The youth population has declined by over 45,000 since 2011, a 3.4% drop. That trend is likely to continue in the future as well; our past research has shown that the state’s birth rate is at its lowest point in at least a generation, and its fertility rate (births relative to population of women ages 15 to 44) also has declined over the past decade.

And this issue of a shrinking labor pool seems to have gotten worse since the end of 2017. While the state’s labor force finally grew by 2,600 in August (as shown in this week’s Wisconsin jobs report), it’s still down by more than 21,000 since the end of 2017.

Wisconsin labor force, Dec 2017-Aug 2019
Dec 2017 3,142,100
Dec 2018 3,125,600
Aug 2019 3,121,000

In fact, while the state’s unemployment rate has barely changed in that time (3.0% in Dec 2017, 3.1% in Aug 2019), the number of “employed” Wisconsinites has dropped by 24,600.

What’s also concerning is that the Policy Forum notes that many mid- and large-size Wisconsin counties are among the largest losers of working-age people. The only notable exceptions are the Madison and Appleton areas.

Notably, the statewide decline in working-age residents has affected most though not all counties. Among the state’s 23 most populous counties, 17 have seen their working-age populations shrink since 2011. (See Figure 2 on page 2). The working-age population in Wood County (where Wisconsin Rapids and Marshfield are located) has declined by the largest percentage (-5.9%) during that period, followed by Manitowoc County (-4.6%). Milwaukee County has lost the largest number of working-age residents (-8,846).

On the other end of the spectrum, Dane County has increased its working-age population by the largest number (>15,000) and percentage (4.7%) since 2011, a trend likely influenced by UW-Madison’s attraction and retention of students from both within and outside the state. Dane County also has shown strong and steady growth in its population of youth under 18, which will help to ensure a healthy labor force well into the future.

Another exception is Outagamie County, where Appleton is located, which has seen its working-age population grow by 2.9%. St. Croix and Kenosha counties also have seen modest increases in their working-age populations, but both counties border neighboring states and many of the jobs held by their residents are located in the Twin Cities and Chicago metro areas.

This is also reflected in the fact that the state’s “growth” in the 2010s to be heavily concentrated in a handful of areas. And it reiterates that the state’s low unemployment rate hasn’t been a function of jadding jobs as much as it is a reflection of an aging state with a stagnant population.

In addition to the falling work force, Wisconsin’s job creation has stalled out over the last 2 years. The “gold standard” Quarterly Census of Employment and Wages told us that 2016 had Wisconsin's the worst growth in the 2010s, until 2018 was even slower.

It’s deteriorating further in 2019, according to the monthly reports that we have seen so far.

Change in jobs, 2019 Wisconsin
All jobs
Dec 2018-Apr 2019 -4,200
Apr 2019-Aug 2019 -2,200
TOTAL CHANGE 2019 -6,400

Private jobs
Dec 2018-Apr 2019 -2,000
Apr 2019-Aug 2019 -3,900
TOTAL CHANGE -5,900

It’s clear that we need to improve the attractiveness of this state to stop the declines in the state's working-age population. Giving everything away to corporations, defunding public education, and paying substandard wages isn’t anything that encourages talented individuals to locate themselves and their families in the state.

The growth of Dane County gives a guide for the rest of the state - invest in quality of life, technology, openness and education makes a place more attractive. And no county is more diametrically different than the regressive economic model that the Fitzwalkerstanis designed. So unless we want Wisconsin to lag and stagnate in the 2020s like it has in the 2010s, then we need to change course, and fast. s s

C'mon Dems. GET ANGRY!

After the absurdities in DC of this week, time to play this great West Wing clip again.



Far too much of Dem "leadership" in DC is still operating from that soft, defensive mentality. And they think being proper and following the rules is something that voters will reward, and that you have to "trust the system".

Well voters don't trust the system, and they don't care much about decorum if nothing gets done. They want action and they want politicians that aren't afraid to step up for what they believe them. And they don't need to wait for a poll to tell them to speak out.

You know what a lot of people are waiting for? For Dems to slap GOPs in the face for being a bunch of lawless, amoral crooks. And keep smashing them in the face, and locking them up when they refuse to provide information that they are REQUIRED BY LAW to provide. And when lowlifes like Corey Lewandowski think they can laugh in your face, you air him out in front of all the cameras, call him a lying piece of garbage to his face, and haul his ass out of the House chambers and into a holding room for breaking the law.

It would be cathartic for a whole lot of people. And it is necessary.

Fed cuts rates, but that wasn't the biggest monetary story

As expected, the Federal Reserve cut interest rates by another 25 basis points on Wednesday.

The Federal Reserve approved a much-anticipated quarter-point interest rate cut Wednesday but offered few indications that further reductions are ahead as members split on what to do next.

Following its two-day policy meeting, the central bank announced that it would take down its benchmark overnight lending rate to a target range of 1.75% to 2%. That comes nearly two months after the policymaking Federal Open Market Committee went ahead with its first cut in 11 years.

While a majority agreed with the 0.25% reduction, one Fed member wanted a cut of 0.5%, while 2 didn't want any cut at all.

The stock market whipsawed as a result. Wall Street originally was unhappy (I think) because the Fed statement led them to believe that the rate cuts might end sooner than later, and the DOW was down more than 200 points in the first hour after the meeting. But then that reversed and the DOW ended up 36 points....because they figured MOAR COCAINE after all?

But a big story emerged in the days before the Fed meeting, as there was a mini-panic on Wall Street with banks were running low on short-term cash.

Repurchase agreements are the grease that keeps the financial system’s wheels spinning, allowing different market participants to borrow and lend to each other to cover short-term cash needs.

On Tuesday, the wheels stopped turning. The so-called repo rate soared to a high of 10 per cent, when it typically trades in line with the Federal Reserve’s target interest rate of between 2 per cent and 2.25 per cent. The New York branch of the Fed had to step in and inject tens of billions of cash into the system in an attempt to restore order, doubling down on Wednesday with a second short-term injection.

That’s not comforting. So what’s going on here? Let's allow Janney Funds' main bond guy to give his explanation.

The underlying problem is that primary dealer balance sheets are chalk full of Treasuries (caused by increased issuance) and dealers desperately need to finance those Treasuries, which limits the flexibility of the system when short term needs arise. 7/x pic.twitter.com/781dHAVlOm

— Guy LeBas (@lebas_janney) September 17, 2019

My worry is a simple one: when repo rates spike, the weakest borrower get squeezed the hardest, and "surprises" tend to emerge, because there's no cheap financing to paper them over. 9/x pic.twitter.com/WqnarbSeUv

— Guy LeBas (@lebas_janney) September 17, 2019

To me, it sounds like that situation in Vegas where you're tell others “I have no cash because I made a bunch of bets and the games haven’t been played,” but you have to pay for other things and do some other things, and you have no money.

The Fed also played a role in this freeze-up, as the improving economy throughout the 2010s meant that they didn’t have to do as much to help the stock market and economy by being a buyer of certain securities.

The Fed has been reducing the size of its balance sheet, letting the Treasuries and mortgage bonds it bought following the financial crisis roll off. In turn, that reduces the amount of cash reserves banks hold at the Fed. In 2014, banks held $2.9tn in “excess reserves” with the central bank. Since then, that number has dropped to about $1.3tn, where it has hovered all summer.

Fewer cash reserves means less money available at the banks to cover short-term funding stress.

At Wednesday's meeting, Fed did not necessarily say they would buy up more securities, but they did say it was time to loosen up reserves and make them a source of lower rates for banks.

In addition to the reduction, the Fed cut the interest it pays on excess reserves by 30 basis points, greater than the funds rate cut, amid a breakdown this week in the overnight repurchase lending market. The move was aimed at keeping the funds rate within its target range; the interest on excessive reserves (IOER) historically has acted as a guardrail for the funds rate, which traded 5 basis points above the target.

The next Fed meeting comes at the end of October, and I would have to think that economic data that comes in over the next month is going to be a big deal here, combined with whether these cash crunches are continuing for companies over the coming weeks (another repo operation is scheduled for tomorrow).

It feels like the Fed is in a catch-22/ If the economy seems to have overcome its August and September jitters, that along with 2.4% core inflation would not make more rate cuts a sensible move (no matter what debt-ridden Donald Trump says). On the flip side, the Fed funds rate is now down to 1.75%-2%, so cutting the rates again would send a message that the overall economy is weak and shaky (which Trump and other GOPs wouldn’t want to admit).

As I’ve said a lot in recent weeks, things don’t seem to add up on either Wall Street or in the overall economy these days. And today’s Fed decision seemed to match that level of confused cautiousness, with Fed Chairman Powell admitting the Fed has to make "difficult judgments" with all the cross-pressures.

US uninusred risies in 2018, and both Wisconsin and America is in danger of much more soon

The Census Bureau released their annual figures this week on the number of Americans that have (and do not have health insurance). And it featured this disturbing statistic.

In 2018, 8.5 percent of people, or 27.5 million, did not have health insurance at any point during the year. The uninsured rate and number of uninsured increased from 2017 (7.9 percent or 25.6 million) (Figure 1 and Table 1)

That’s the first increase in the uninisured rate since 2009, and it comes in a year where the economy was still growing. Sounds a lot like what we saw in the 2000s during the Bush “expansion”, doesn’t it?

In fairness, economic growth might explain some of these changes, as nearly 2 million fewer people got their health insurance through Medicaid, so they could have conceivably gone over the income limits in 2018. But instead of those individuals getting insured through the private sector, slightly fewer people got health insurance through that method as well, and it more than offset the increased enrollment in Medicare for 2018.

The percentage of people covered by any type of health insurance in 2018 was lower than the percentage in 2017. This decline appears to be driven by a 0.4 percentage-point decrease in public health insurance (Table 1). Medicaid coverage decreased by 0.7 percentage points between 2017 and 2018. The rate of Medicare coverage moved in the opposite direction, increasing by 0.4 percentage points. This increase was partly due to growth in the number of people aged 65 and over and not a change in Medicare coverage for adults in this age range.

The percentage of people covered by private health insurance, or any of its three subtypes (employment-based, direct-purchase, and TRICARE), did not statistically change between 2017 and 2018…

Employer-based insurance was the most common subtype of health insurance (55.1 percent), followed by Medicaid (17.9 percent), Medicare (17.8 percent), direct-purchase insurance (10.8 percent), TRICARE (2.6 percent), and VA or CHAMPVA health care (1.0 percent) (Table 1).

Direct-purchase insurance includes coverage obtained through a state or federal [Obamacare] marketplace. In 2018, 3.3 percent of people, or 30.8 percent of people with direct-purchase insurance, obtained their coverage through a state or federal marketplace.

Also interesting is the breakdown the Census Bureau gave on the income levels of the uninsured. Not surprisingly, poorer people are more likely to be uninsured than richer ones, but it were more well-off individuals who were more likely to lose their health care in 2018.

Health insurance coverage is generally higher for people in higher income-to-poverty ratio groups. In 2018, people in poverty (the population living below 100 percent of poverty) were least likely to have health insurance coverage (83.7 percent), while people living at or above 400 percent of poverty were most likely to have coverage (96.6 percent) (Table 4). Between 2017 and 2018, overall health insurance coverage decreased 1.0 percentage point for people in families with income from 300 to 399 percent of poverty and 0.8 percentage points for people in families with income at or above 400 percent of poverty. During this time, the overall health insurance coverage rate did not statistically change for any other income-to-poverty group.

Public coverage continued to be most prevalent for the population in poverty (66.8 percent) and least prevalent for the population with income-to-poverty ratios at or above 400 percent of poverty (18.5 percent) in 2018.

In fact, while people from households that make 300% or more of poverty are 5/9 of the country, they accounted for more than 85% of the 1.86 million Americans that lost health insurance last year. To me, this points to people who are likely to use the Obamacare exchanges, and/or might be “gig economy” contractors who weren’t already getting health insurance through their jobs.

Narrowing it down further, the Census report looks at a group of individuals just above the poverty line that can be covered under the expanded Medicaid provisions under the Affordable Care Act....or might not be covered by Medicaid in states that don't expand it.

Health insurance sources, 100-138% of poverty, 2018
Private sector 24.8%
Public sector 63.8%
Uninsured 14.7%
(totals over 100% as some people may have insurance for only part of the year).

In Wisconsin, we also had an increase in the amount of people uninsured. Not by much mind you (from 5.4% to 5.5%), and we are still a decent 11th among the US states and DC. And it certainly seems that Wisconsin has had quite a few individuals get enough income to become less eligible for public health care coverage, mirroring a trend in the US.

In particular, a sizable number of Wisconsin (and especially children) have gone off of regular BadgerCare in Wisconsin over the last year, and have ended up on what are known as “income extensions.”

These extensions are in place for either 4 or 12 months, depending on why the person’s income got above the poverty line, and are intended to prevent people from being cut off of BadgerCare if their income bumps up for a short period of time (like with seasonal/occasional work).

A BadgerCare Plus extension is a period of eligibility given to a person when the assistance group's income increases above 100 percent FPL either due to an increase in earned income and/or spousal support and otherwise meets the BadgerCare Plus eligibility criteria for people with incomes below 100 percent FPL.

A parent/caretaker relative or pregnant woman can enter an extension due to an increase above 100 percent FPL in the assistance group’s earned income, spousal support, or both. The children, stepchildren, and NLRR children of the parent/caretaker will also enter the extension at this time, provided they are under age 19, living with the parent/caretakers, and meet the income requirements outlined in Section 18.1.3 Children.

BadgerCare Plus members eligible as childless adults are not eligible for an extension.

Side note - the Walker Administration wanted to have people getting extensions have to pay a premium, but the Centers for Medicaid and Medicare Services disallowed that in late 2018.

What this shows is that tens of thousands of Wisconsinites may be in danger of losing their BadgerCare benefits in the coming months as those extensions run out. If those individuals aren’t getting insurance from their jobs/income sources, those individuals will likely have to get it from the Obamacare exchanges…if they get it at all.

You don’t think many of those Wisconsinites just above the poverty line would benefit from having Medicaid, and being able keep the same benefits and providers? And let’s not forget, that by refusing to expand Medicaid, we are paying an extra 31% for all of the current Medicaid expenses of people in poverty, while leaving people just above the poverty line in a tenuous situation.

In addition, the high number of middle-income people losing health insurance in 2018 shows that Trump/GOP attempts to mess with the ACA is having success, as insurance companies on the exchanges aren’t offering policies that people want for the price they’d have to pay. At 300%+ FPL, they are getting little to none of their Obamacare policy paid back through tax credits, it indicates a flaw that needs to be fixed (cough – public option and/or Medicare for All – cough).

And if we're starting to see more people become uninsured in America under a "growing" economy in 2018, what happens when an economic downturn hits sooner than later, and corporations decide offloading the costs of health care benefits are a good source of cost savings? And combine that with the fact that the ACA's individual mandate penalty was removed on January 1, 2019 due to the GOP Tax Scam. Ruh roh.

How Dems win Wisconsin looks very different today vs 2000s.

These are a couple of neat electoral maps of Wisconsin that I saw this week from Drew Savicki, who passes this stuff along on the Twitter on occasion. Especially the second one, which shows the maps from two close Dem electoral victories in the last 15 years.

Everybody requested this so here is the swing to the 2018 gubernatorial race. Tony Evers outran John Kerry by 0.76%. pic.twitter.com/7eFv79j14K

— Drew Savicki (@SenhorRaposa) September 13, 2019

It really illustrates how different things are these days from even the early 2000s. Republicans have made major gains in much of northern Wisconsin, especially once you get out of the Green Bay/Appleton metro area, and East-Central Wisconsin. This has turned swingy or even blue-leaning areas quite red.

Dems have made up the difference by making gains in much of the southern half of the state. This is especially true in Dane County and the counties around it, and also in the Milwaukee suburbs, particularly as you get closer to the city itself (which is why state legislative districts that were gerrymandered to include the edges of Milwaukee County are now swing districts).

The real battlefield seems to be in Racine and Kenosha Counties, where percentages didn't change much at all, and the votes were relatively split between Dem and GOP. If either party gets a gain in that part (and/or a bigger turnout), it'll likely be a strong harbinger of who wins the state in 2020.

There's also a difference in where the votes are, as the population of those redder places up North stagnates and ages while Dane County and other places getting bluer tend to be growing faster (the City of Milwaukee being a notable exception).

I also can't help but notice this comparison between two relatively close GOP election losses in presidential election, and Donald Trump's win in 2016.

Number of votes, GOP presidential candidate
Bush 2004 1,478,120 (49.3%, lost)
Romney 2012 1,407,966 (45.9%, lost)
Trump 2016 1,405,284 (47.2%, won)

Trump basically "won" Wisconsin in 2016 because fewer people voted, especially in blue-leaning cities like Milwaukee. Fewer Wisconsinites voted for Trump than the amount that voted for Romney and (especially) Bush. And given the demographics of the average Trump voter, I bet a decent amount of those 1,405,284 aren't going to be around in 2020.

Now let me bring in the last 3 midterm elections for Governor.

Number of votes, GOP governor candidate
2010 Walker 1,128,941 (52.3%, won)
2014 Walker 1,259,706 (52.3%, won)
2018 Walker 1,295,080 (48.4%, lost)

Poor Scotty. He got more votes in each succeeding November election he was in. But lost his last one when more Wisconsinites finally decided to show up to vote his ass out.

This seems to indicate that when more people show up to vote in November elections, Republicans can't win. So Dems should be working on having candidates who inspire turnout in higher-population areas over trying to turn people and parts of the state who have turned against them. This may put Dems at a disadvantage for the State Legislature in much of the state (even before gerrymandering), and I am not arguing that those areas should be abandoned, as even a swing of a few percentage points in those rural areas pretty much makes GOPs toast in a statewide election, so Dems need to have a PRESENCE in every corner of Wisconsin (something they often forget to do).

But for statewide elections, the trends in voting patterns and the map to victory seems pretty straightforward. So Dems need to get causal lesser-frequency populations registered, and get them to the polls. If so, the bleeding in the state and the country can be stanched for good, and real recovery from an awful 2010s can begin.

Income and poverty figures show not everybody did better a year after GOP Tax Scam

Last week, the US Census Bureau told us that despite a supposedly growing economy, household incomes grew very little in 2018.

Following 3 consecutive years of annual increases in the real median income of all households in the United States, the 2018 median income ($63,179) was not statistically different in real terms from the 2017 median of $62,626.

Whoo! A whole $553 in the year after the GOP Tax Scam took effect. Hope you didn’t spend it all in one place!

There was also an interesting age disparity for income growth last year, where householders under age 35 had very good income growth, but people between the ages of 35 and 65 (a much larger group of people with higher incomes) didn’t gain much at all. In fact, people age 55 to 64 lost ground in 2018.

An already-large regional gap in income got larger in 2018, as the Northeast outpaced the rest of the nation for income growth, while incomes in the South stagnated.

These regional differences also played out on the lower end of the income scale. The Census Bureau said poverty declined in the country by 1.4 million people in 2018, and the rate fell from 12.3% to 11.8%, as might be expected in a year stimulated with tax cuts and 2.9% GDP growth. But that was varied throughout the 4 regions of the country, as the Northeast had the largest drop in poverty, while the South didn’t drop at all.

From 2017 to 2018, the South was the only region not to experience a decline in its poverty rate. The 2018 poverty rate for those in the South was 13.6 percent, representing 16.8 million individuals in poverty, with neither estimate statistically different from 2017. The South had the highest poverty rate in 2018 relative to the other three regions. The 2018 poverty rate and number in poverty for the Northeast was 10.3 percent and 5.7 million, down from 11.3 percent and 6.3 million in 2017. The 2018 poverty rate and number in poverty for the Midwest was 10.4 percent and 7.0 million, down from 11.2 percent and 7.6 million in 2017. Comparing 2017 and 2018, poverty rates declined in the West, while the number in poverty did not. The poverty rate for the West in 2018 was 11.2 percent, down from 11.9 percent in 2017 while the number in poverty was 8.7 million.

Also remarkably, the Census Bureau said the poverty rate in large cities was lower in 2018 than in rural America.

Inside metropolitan statistical areas, the poverty rate and the number of people in poverty in 2018 were 11.3 percent and 31.9 million, down from 11.8 percent and 33.1 million in 2017. Among those living outside metropolitan statistical areas, 14.7 percent, or 6.2 million, were in poverty in 2018, with neither estimate statistically different from 2017.

The 2018 poverty rate for those in principal cities was 14.6 percent, with 15.3 million in poverty, a decline from 15.8 percent and 16.4 million in 2017. Among those living inside metropolitan areas, but not in principal cities, the poverty rate in 2018 was 9.4 percent and the number in poverty was 16.6 million. Neither the poverty rate nor the number in poverty within this group were statistically different from the 2017 estimate.

Higher poverty in the sticks than the big cities? I bet you won’t hear Trump or Faux News stations mention that reality.

But another Census report indicated that perhaps there wasn’t a cut in poverty after all – depending on how you define “poverty.” That’s in the Supplemental Poverty Measure, which accounts for a few other variables beyond income and family size.

Income used for estimating the official poverty measure includes cash benefits from the government (e.g., Social Security, unemployment insurance benefits, public assistance benefits, and workers’ compensation benefits), but does not take account of taxes or noncash benefits aimed at improving the economic situation of the poor (often food stamps and related aids). The SPM incorporates all of these elements, adding in cash benefits and noncash transfers, while subtracting necessary expenses such as taxes, medical expenses, and expenses related to work. An important contribution of the SPM is that it allows us to gauge the potential magnitude of the effect of tax credits and transfers in alleviating poverty. We can also examine the effects of nondiscretionary expenses such as work and medical expenses.

And when you take those items into account, the Census Bureau said poverty slightly increased in 2018.

In 2018, the percentage of poor using the SPM was 13.1 percent compared to 13.0 percent in 2017, not a statistically significant change. The poverty rate changed by a statistically significant amount for only two groups in Figure 2, individuals with no high school diploma who experienced a 1.9 percentage point increase in poverty from 2017 to 2018, and individuals with a bachelor’s degree or higher, who experienced a 0.5 percentage point increase in poverty from 2017 to 2018.

So a lot of lower-income people are still struggling quite a bit when you bring up what they have to pay out of pocket and in taxes. This seems especially true in states that have either a high cost of living or a lack of medical care for lower income individuals

As you can see, Wisconsin fares well under the Supplemental Poverty Measure, dropping its poverty rate from 9.5% to 7.9%, with only Iowa (6.8%) and Minnesota (7.3%) having lower rates. And it’d likely be even lower if we had people near the traditional poverty level getting the Feds to pay for 90% of their Medicaid expenses instead of being forced to have their insurance left up to the private sector and/or choose to be uninsured.

I think these figures help to explain why despite Coastal elites claiming the economy was "great" in 2018, it didn't feel that way in much of the country. Despite higher GDP growth, income growth stagnated, and higher everyday expenses made poorer people no better off then they were the year before.