The Jobless Despair Continues Unabated


The new Oregon employment figures are out for August of 2009 and they can only be described as disastrous. So much so that even the Oregonian, which trumpeted July’s figures as a sign of an improving Oregon economy, provided a detailed front page story regarding Oregon’s bleak employment picture.

Oregon has retaken its place as the second worst in the nation — second only to Michigan, home of the collapse of America’s automotive industry. The employment figures are so bad that, for the first time in ages, the total number of government employees declined — declined by 2,000. But lest you think that Gov. Kulongoski gets it, please note that the entire burden of the public employee decline fell on the backs of local government — meanwhile, Kulongoski increased the number of state employees by another 100.

The employment figures are so bad that, for the first time in ages, the Oregonian did an in depth analysis of the figures and discovered that Oregon’s unemployment isn’t the 12.2 percent reported by the Oregon Department of Labor. In fact, because unemployment figures count only those who are receiving benefits and exclude those whose benefits have expired, the actual unemployment rate is closer to 14.8 percent. And if you include the underemployed — those who have had to settle for part-time jobs or who have reduced hours — the figure jumps up to 23.3 percent. That’s it — nearly a quarter of Oregon’s workforce is unemployed or underemployed.

And even though the Oregonian is finally alarmed by the situation, it is clueless as to the causes for the continuing jobless slump being endured by Oregon workers — preferring to blame homemakers and the elderly for re-entering the workforce. One wonders whether it is continuing misplaced loyalties to the liberal Democrat establishment or simply, like Gov. Kulongoski, systemic ignorance as to what drives an economy.

What drives an economy is business growth — private business growth. Private business growth creates jobs. Jobs move people from the position of drawing down government coffers (jobless benefits and welfare benefits) to building government coffers (taxes — particularly on income). In Oregon, nearly 133,000 private sector jobs have been lost since peak employment in December of 2007 while the number of government jobs (education and federal, state and local government) have increased by 29,000.

And the reason that those jobs have been lost is not because homemakers and the elderly have returned to the workforce but rather because businesses have either moved, closed or substantially reduced their Oregon workforces. While the Oregon Department of Labor maintains extensive statistical data on virtually every sector and subsector of businesses operating in Oregon it apparently does not publish statistics on the total number of businesses on a monthly, quarterly or annual basis. We are left to mine the anecdotal information regarding businesses that close or relocate — and they, apparently, are legion.

Even Gov. Kulongoski’s vaunted program to grow Oregon through “green jobs” received a staggering blow when Suntech, announced that it was abandoning its intent to establish a plant in Oregon and will, instead, build it in Phoenix — where, by the way, the sun actually shines for three hundred plus days per year as opposed to about 100 in the Willamette Valley.

Oregon already suffers from the Big Three deterrents to business location and expansion — high taxes, restrictive land use regulation and burdensome regulations. And all of that is made even worse by the uncertainty of future government policies. Uncertainty inhibits planning — expansion, production and pricing.

In Oregon, Kulongoski and his colleagues in the liberal Democrat legislature increased that uncertainty exponentially. They increased Oregon’s business taxes dramatically making Oregon second only to Denmark in the world. They have adopted dramatic greenhouse gas emission goals at a time when many businesses are exporting their manufacturing and production jobs to China, India and Southeast Asia — all of which have steadfastly declined to participate in limiting greenhouse gases, preferring instead to grow their economies. They toyed with the concept of a “cap and trade” that would have set it apart from the other states and more importantly other nations and would have imposed significant new and increased costs on Oregon businesses. And they have expanded government size and spending at a time of an extraordinary contraction of private business and private employment.

And in Portland, the heart of Oregon’s liberal establishment, the Portland Metro Council — charged with administering Oregon’s restrictive land use provisions — has determined that no further expansion of the urban growth boundary is needed for the next twenty years. Oregon’s population has grown at an average rate of 1.59 percent annually over the last fifty years. Assuming a continuation of that growth the Portland Metro area can expect to add nearly 1,000,000 people to its population in the next twenty years and yet Oregon’s liberal political establishment will force it to grow within its current boundaries. The Metro Council has suggested that growth can occur in existing aged and abandoned industrial property while at the same time it has restricted the transportation capabilities to and from those properties by cannibalizing existing streets and routes in favor of costly and highly inefficient light rail systems.

This is the future that business faces as it decides whether to locate, expand or relocate to and from Oregon. It’s not a difficult choice.

The reason that Oregon’s unemployment rate is one-third higher than the rest of the nation; the reason that employment will continue to decline is quite simple — “business” is not spoken in Oregon political circles. All focus in Oregon’s liberal political environment is on the preservation, growth and funding of government. It has been so routine for the past twenty years that its impact on business has become irrelevant to Oregon’s unbroken string of liberal Democrat governors and its accompanying legislatures — Republican and Democrat alike.

In a place as beautiful as Oregon, blessed with an abundance of natural resources and located at the gateway to Asia, it is a genuine pity that Oregon’s leaders continue to fail to understand that real “quality of life” starts with a good paying job. Unfortunately, it just never crosses their minds.

But there are solutions. For Oregon voters, sign the petitions to refer the 2009 Legislature’s massive tax increases and then vote to rescind them on the November ballot. For Oregon legislators, reduce the capital gains tax by one-half; eliminate the state inheritance tax for those portions of the estate that represent farms, ranches and businesses in Oregon; and subject every board, bureau or agency to a six-year audit cycle — continuation of any such entity would require legislative re-authorization and thus mitigate the ability of the administrative part of government to kill reforms through inertia. (Better yet, cap state spending based on the growth of total personal income.) And for Oregon’s governors, take an economics class, run a small business, and learn that growth in private business is the key to the growth in good jobs (and increased tax revenues for government programs).

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  • Jerry

    I suspect people like the unemployment. You don’t have to work and you get paid. How else can we explain why these economic illiterates keep getting elected and re-elected to office in OR?
    How, I ask.
    It is unreal.

  • Rupert in Springfield

    Yeah – But its a happy joblessness.

    No way we are going to be showing granny living in a refridgerator box or anything like that with the Ted and Barry show going on!

    And now we are supposedly in recovery. Sure its a jobless recovery, but hey, thats better than anyone questioning the road we are on.

  • Oregometry

    Jerry,

    I have to take issue with your assessment of “economic illiterates.” These folks are far from illiterate. Moreover, many have fancy-pants degrees from Harvard, Yale and Princeton.

    The problem this poses for me in the realm of “economic illiteracy,” is not that these folks don’t know the facts, it’s that they’re of the same class, mindset and status of the Ivy League asshats at the helms of Bear Stearns, AIG and Wachovia! They make policy not from a view of “market” or “government” or “populism,” but rather what suits their friends and financial backers.

    These elected officials are a far cry from “economic illiteracy.” I’d call it “economic malice” and “economic dishonesty.”

  • v person

    When you look at a comparison amongst all states, you see a concentration of highest unemployment in Oregon, California and Nevada in the west, Michigan and Ohio in the rust belt, Rhode Island in New England, and a whole lot of southern states, Kentucky, Tennessee, S Carolina, Georgia, plus Florida.

    What do all these states have in common? Not much of anything really. So why try and parse what has driven Oregon unemployment a bit higher than elsewhere? This is a national economic problem, not a state problem. Our stricter land use laws probably have nothing at all to do with unemployment. All you have to do is look at Nevada, which is sprawl central, to see that.

    Green jobs, which Mr Huss disparages, are about the only manufacturing jobs nationally that show any potential to increase in the future. Oregon is already well ahead of the pack on attracting these jobs, so why trash the one thing that is working for us? I don’t get it.

    • Steve Plunk

      Each state represents a particular set of problems that can be identified fairly quickly. Rather than say they have nothing in common we should be looking at each state’s individual problems.

      The problems of Oregon and Nevada are directly tied to California and it’s meltdown. Not just the government meltdown but more importantly the collapse of the speculative housing market. Until California recovers Oregon and Nevada will languish as well.

      The car producing states have their own problems that go back for decades. The big three did what our government is doing and deferred costs in the form of retirement benefits that now cost nearly as much as working employees. We should learn from this.

      Florida is like California. Housing bubble bursts and the economy tanks. The other states have various reasons for high unemployment.

      What these states do have in common is a heavy government involvement in the failures. It’s been firmly established how Fannie and Freddie (at the behest of Barney Frank) contributed to the housing bubble. Government mandates and unions have destroyed the auto business along with their own policies. There are regional and even state differences with this problem.

      Green jobs? Without government subsidies there are green jobs, plain and simple. A Potemkin village filled with hucksters and sharp operators looking to make a buck with the governments help. One more in a series of promised jobs to replace timber like high tech and tourism.

      Oregon needs to realize business friendly policies attract business. Business pays the bills and hires the workers. Workers pay taxes alongside the business and the state can afford better schools and better infrastructure. Raising taxes and increasing regulation just drives business away and more importantly discourages existing business from expanding. Our governor and legislature have made it very clear they care nothing about business and see business as a cow to milked until dry.

      • v person

        “What these states do have in common is a heavy government involvement in the failures. ”

        I don’t think that is true of the Dixie states. They don’t even have a minimum wage, they don’t have unions, and they have very low government spending on education. Yet as a group they are near the top in unemployment. So if heavy government involvement is a cause, how do you explain Dixie?

        “It’s been firmly established how Fannie and Freddie (at the behest of Barney Frank) contributed to the housing bubble. ”

        At best this is an assertion, not an establishment. Barney Frank was in the minority party when Fannie and Freddie decided to get into the derivative game.

        “Government mandates and unions have destroyed the auto business”

        The foreign manufacturers in the south are not unionized, and they are also losing money hand over fist. Labor is now about 10% of the cost of a new car. What is killing car manufacturing is the inability of workers to afford new cars because their pay keeps dropping. Remember old Henry Ford? He made sure to pay his workers enough to buy his products. Today, that is Wall Mart’s strategy and they don’t make a dang thing except money.

        “Business pays the bills and hires the workers. ”

        Sure. Even Bernie Madoff paid his workers quite well for a while. Beanie Babies probably paid well at one time. But why worship “business” as a generality? Some businesses make useful things responsibly. Others pollute, cheat, don’t pay taxes, and bank in the Cayman Islands. Green jobs are in new industries, and these take some nurturing to develop. If Oregon does not provide the nurture, other states will. Timber is not coming back any time soon.

        “Our governor and legislature have made it very clear they care nothing about business and see business as a cow to milked until dry.”

        That is way an overstatement. Oregon’s business taxes are far far lower than they were 20 years ago. The burden of state government has shifted to the individual taxpayer. Look it up.

        • Rupert in Springfield

          >At best this is an assertion, not an establishment. Barney Frank was in the minority party when Fannie and Freddie decided to get into the derivative game.

          Not a lot new here.

          Frank is a Democrat therefore you will never find him at fault for anything.

          Dean – Please, learn to get laughed at if you think being in the minority party absolves one of everything. Its a little ridiculous, especially with Frank, who was saying Fmac and Fmae were totally sound six months before they went under, and who was key in pressuring for ninja loans.

          • v person

            “Frank is a Democrat therefore you will never find him at fault for anything. ”

            I hate the way when he talks he seems to slobber and you can never see his teeth. Does he even have any teeth? I think that is weird given that Congressmen get way good health care that includes dental. Also, his suits are always rumpled. What’s with that? Can’t he hire someone to press his clothes? We need the jobs.

            Happy now?

            Being in the minority party in the House is being utterly powerless. So It does not matter what he said or what sort of loans he was for, or if he thinks the moon is made of green cheese. He had no power to influence outcomes when the economy went off the rails. Therefore, pinning the blame for the financial collapse on him violates the first principle of conservatism, which is assigning personal responsibility where it belongs. Or maybe that is only the 2nd principle. Or 10th. Or maybe it was edited out somewhere along the road to mass right wing lunacy and Glenn Beck.

            But, now Frank IS in a position of power. If he passes bad bills and the economy goes further south, then it will be on him and Obama and the rest. So keep your fingers crossed for further decline. And stock up on that canned food.

          • Rupert in Springfield

            Well, we know facts don’t matter to you, since you will never criticize your masters on something of substance.

            The facts are clear, both Dodd and Frank were vehement that Fmac and Fmae were in good financial shape right up until the collapse.

            Barney Frank for years obstructed Bush administration requests to set up an agency to regulate Fmae and Fmac.

            Who pushed for looser lending rules? Why Frank and Dodd. I even blogged about it here years before the collapse.

            Them’s the facts. You want to live in fantasy land? Be my guest.

            Sure, the making fun of how Frank talks or the teeny rat teeth probably makes you feel better about having to excuse everything any Democrat ever doe.

            At the end of the day we all know on any given issue what your response will be. Its what your masters tell you, they lead, you follow, that’s the rule for you. You can never be critical of your leaders. You can never say anything they do is wrong and you can never find blame with anyone of your party for anything.

            Unfortunately for you, that has some consequences. Most notably being put in the position of making totally non sensical arguments.

            You are the guy who made the absurd suggestion that Bush was never criticized for his spending by conservatives.

            You are the one person on the planet who seems to think BO has spent a thimbleful, to use your word, compared to Bush. Anyone over the age of ten knows BO spent more in six months than all the other presidents combined. Anyone but you that is.

            You are the guy who argued throughout the campaign that BO was not a liberal, he was a moderate. This while the man was touring the country talking about spreading the wealth and raising taxes even if it resulted in lower revenue as a form of social justice. Thus showing you had no idea who the hell you were voting for. He was a Democrat and that was all you needed.

            You even defended Van Jones even after BO had thrown him under the bus.

            Well, you may be a blind partisan but you were right about one thing – your decision on our bet regarding health care.

            Things are looking kind of dim on that front. They will probably pass some sort of face saving measure, but it wont be covering any 95% of the populace as you had predicted. Maybe they will loosen up Medicaid enrolment and call it good, who knows. If we could find an inexpensive way to sate BO’s grandeur maybe he can come out a winner and the country can as well.

            At any rate, I am glad to say your instinct to welsh out on our bet was entirely correct.

          • v person

            “The facts are clear, both Dodd and Frank were vehement that Fmac and Fmae were in good financial shape right up until the collapse.”

            Yes, at least Frank did that. And the fact is also clear they were both in the minority during all the events that led up to the collapse. Which fact is more important with respect to the CAUSE of the collapse Rupert? What someone SAID at the tail end or what they DID in the years prior? This is a test by the way.

            “Who pushed for looser lending rules?”

            See above. Who cares what they did or did not “push” for? Who was in charge of the rules? Not them. You can blog all you want but you can’t change history. Frank was in no position to make the rules since 1994. Dodd probably did have some influence because in the Senate minorities count for something other than plant watering, and it looks like he is going to pay a political price for this. But still, he was in the minority and at worst shares only a fraction of the blame.

            “At the end of the day we all know on any given issue what your response will be.”

            With due respect Rupert, you don’t know jack about me the beginning, middle, or end of the day. You don’t read what I write, you run away from my substantive arguments, and you make up stuff I said that I didn’t so you can argue with that instead.

            “You are the guy who made the absurd suggestion that Bush was never criticized for his spending by conservatives.”

            Case in point on making stuff up. I never said any such thing. I asked where were the tea parties? Where were the protests? Why did conservatives vote for Bush twice and defend him? Where were the concerns about deficits when he and his Republican Congressional lap dogs initiated 2 wars and a major expansion of an entitlement while cutting taxes? Was there a “conservative” here or there issuing a feeble complaint? Sure. So what? They also elected him sort of twice.

            “You are the one person on the planet who seems to think BO has spent a thimbleful, to use your word, compared to Bush.”

            OK…”thimbleful” is only a metaphor. Bush has an 8 year record of deficits and in the end a nearly ruined national economy. Obama has a 1 fiscal year record at a time of a crisis not of his making. TARP, AIG, Fannie & Freddie, and GM and Chrysler bailouts were ALL under Bush. The 2-year stimulus is the only major spending initiative so far by Obama. And at least he has the guts and sense to propose raising taxes and cutting spending to pay for his health care plan. Bush did neither when he bloated Medicare spending.

            “Anyone over the age of ten knows BO spent more in six months than all the other presidents combined. ”

            Show me your numbers Rupert. I really need to know how Obama has managed to spend more money in a mere 8 months than the over 3 dozen presidents who preceded him, even if one discounts inflation as a mitigating factor. I want to see your math. Make it good. Do’t give me out year CBO projections on money not yet allocated or spent. Show me what he has spent and what every other president spent. Don’t just keep making patently false assertions.

            “You are the guy who argued throughout the campaign that BO was not a liberal, he was a moderate.”

            Well I wasn’t the only guy or gal who said so. And to date, I have not been proved wrong. He tries to find bi-partisan solutions. He has not rushed out of Iraq or Afghanistan, or even closed Gitmo prior to having a replacement. He has extended the Patriot Act. His health care proposal is in the middle, not on the left (single payer). His cap and trade proposal is mainstream and supported by majorities in all polls. He backs charter schools against the opposition of teacher unions. He just supported the Bush Administration approach on Columbia River salmon (no dam removal). He has asked for increases in defense spending.

            Yep…he’s a moderate. He may not look that way from your far right perch on a shaky limb. But objectively, he is straddling center-left relative to the electorate.

            “You even defended Van Jones even after BO had thrown him under the bus. ”

            So you just proved my point that Obama is a moderate. Otherwise he would have given Beck the finger and kept Jones. As for me, I know little about Jones and did not “defend” him. I pointed out that it is wrong to make politically correct speech the test of ones capability or fitness for a public office. But the Right seems to have a new play toy, dredging up past remarks to score points and take scalps. Yes, I know the left has done this as well. But I’ll gladly hand this toy over to you if it means we can finally get rid of it.

            “At any rate, I am glad to say your instinct to welsh out on our bet was entirely correct. ”

            I’ll remind you Rupert, with no particular hope that reality actually matters to you, that one can’t “Welsh” on a bet one did not make. And that when 1 party proposes a bet, and the other sort of accepts with a long list of weird conditions, and then the other says thanks but no thanks to those conditions, that means the counter offer was declined. Hence no bet. Hence no Welshing.

            Having said that, you have a tendency to count your chickens prior to even opening the door to the coop, let alone checking for a successful hatch. A “face saving” measure that prevents insurance companies from high grading, establishes exchanges so people can have reasonably affordable choices of providers, expands Medicare and Medicaid eligibility, and pays for this through program savings and targeted tax raises is hardly a mere face saving. Plus, we may all still be surprised when the public option makes it over the goal line with 51 Senators voting aye.

            But this does demonstrate why a bet with you would have been a bad idea, since you likely would have re-defined your way out of paying.

  • Pat Walsh

    Hi, Your piece was interesting. After checking with the company, I have learned that Centron Solar is staying in Eugene and has not considered moving to Arizona as was reported in the column.

    Pat

  • Joe Schmoe

    Centron Solar is a complete scam. Consumer fraud at it’s best- administered and operated by Chinese enterprise while smooched through the loopholes of the system by liberal democrats like Kulongoski and Read. It seems odd that Kulongoski’s visit to China in efforts to import cheap electric cars to Oregon has led the electric automakers in this country to file dumping claims against China. Yes, you may read further on this at the FTC’s Imports Administrations website. As Centron touted in the EETimes article that they had sold panels to the National Guard in Portland, and also Nike, it seems as the plot has thickened in terms of “special interest” in the materialization of Centron in Oregon. Just having a look at Centron’s advisory board on their website throws plenty of red flags up to who may be involved both financially and politically. Apparently, what Centron solar is not telling you is that they are a channel for lesser-known solar panel manufacturers from China poised to bypass protectionist and antitrust laws in order to set up assembly plants across our Nation. Not only will this allow for the Chinese manufacturers to save on the assembly of these solar panels in China, but they will most likely make up for this and the shipping costs by shipping the raw materials directly. Of course these assembly plants will be eligible for the $20 million per year, per assembly plant. These are not manufacturing jobs, and will most likely be replaced by robotics in the very near future, as they are with many of the largest solar panel manufacturers. This is a Win/Win for both China and the special interest people involved in this utterly deceitful integration and manipulation of our renewable energy industry. Again, Centron creates the illusion that they are their “own” brand by changing the model numbers on solar panels which are already in the market, refusing to disclose their “manufacturer,” and claiming to be a different product all-together. Thanks for writing this story. It is imperative that Oregonians wake up to this issue.

    • Larry Huss

      “Joe Schmoe” is correct regarding Centron. It is Suntech that has decided to locate its manufacturing jobs in Arizona. My apologies. I have corrected the error.

      • Larry Huss

        Wow. This is a rough day. I meant to say that Pat Walsh was correct about Centron staying in Eugene. I have no idea whether “Joe Schmoe is correct or not.

        • Joe Schmoe

          Read the news about Centron. Their president, Ocean Yuan, is shopping around for assembly plants like he’s shopping around for a new pair of Nike Air tennis shoes- Announcing 400 jobs so far both in Eugene, and Vancouver, Washington. Then he took his word back and said that the Hynix building in Eugene was “too clean,” and that the old Panasonic building in Vancouver was “too outdated.” Centron Solar is listed in the Oregon Business Directory as an FBC (Foreign Business Corporation,) not in Oregon, but in Delaware?? Also, the Law firm which represents Centron Solar is Davis Wright Tremaine LLP in Portland. The most noted lawyer from this firm is former Washington State governor Gary Locke- Now appointed by our President as the Chamber of Commerce Secretary. Coincidence? Well that needs to be exposed, more will be revealed.

          The Chinese manufacturers which Centron Solar are hiding from the public are Changzhou NESL Solartech and Jetion Holdings, both of which are already on the California Energy Commissions list of “eligible for subsidies,” aka “eligible for you and my tax dollars.” Centron is swapping the model numbers on these solar panels to their own model numbers, and claiming to be their “own” brand. This happens all the time apparently, but a company must have permission from UL to privately label their products, and must also have permission from their manufacturers in the form of a multiple-listee letter. So far, Centron is NOT authorized to carry the UL logo (Which they are on their website,) even though they may, or may not, be a multiple listee with the manufacturer. Solar panels aren’t exactly linens, tires, chemical or US steel, as our tax dollars go into every single sale this company makes. They are trying to hide the fact that they are representing NESL and Jetion, by claiming to be “intel engineered,” and a consortium (of sorts) of over 30 manufacturers (Not solar panel manufacturers, but wafer, polysilicon, and other raw material manufacturers.) This is a big fat lie! The reason they are creating this illusion for our green happy politicians is because they intend on opening assembly plants under the Centron Solar umbrella, only both Jetion and NESL can now save on assembling AND shipping from China. Basically it’s a cartel poisted to bypass protectionist and antitrust laws.

          One of the interns has created his own facebook page with all the FACTS. Have a look:
          http://www.facebook.com/home.php#/group.php?gid=58360039956&ref=ts

          God Bless America, our constitution, and the American way of life!

  • Dennis

    Isn’t Centron being sued for using unpaid interns for free labor in order to save on start-up costs? Seems this company is off to a bad start for being touted as a “success story.” Where is the resolution?

  • Rufor

    Hi there,
    oregoncatalyst.com – da best. Keep it going!

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