In speeches and media appearances, Republican governors are savaging President Biden for policies they say are wrecking the U.S. economy as a whole. But in the particulars — in their own states, in other words — the economy’s booming.
Somehow, in states as different as Maryland, Florida, Massachusetts and Arizona, Republican governors suggest they’ve found a magic formula for fostering booming growth and reducing unemployment back home.
Take, for example, these remarks from several governors’ annual State of the State addresses this year:
“Our national economy is struggling,” said Kevin Stitt of Oklahoma, before continuing: “As unemployment skyrocketed in some parts of the country, ours is down to just 2.3 percent.”
“Job creation in Florida is far exceeding the national average,” Ron DeSantis of Florida said. “And our labor force has increased six times faster than the nation’s.”
“Our unemployment rate is below 4 percent for the first time since March of 2020, and we’ve gained back over half a million jobs,” Charlie Baker of Massachusetts said.
“Our economic recovery is one of the very best in America, our unemployment rate is the lowest it’s been since before the pandemic and a national survey named Maryland as the most improved state for business in America,” Larry Hogan of Maryland said.
It’s not so easy to separate out the performance of individual states from the nation’s, economists say — let alone attribute that performance to any particular move a governor makes. Nevada, for instance, was hit especially hard by the pandemic because of its heavy dependence on tourism.
“Presidents have less to do with the economy than people think, and the same goes for governors,” said Michael Strain, an economist at the American Enterprise Institute, a conservative think tank.
States run by Republicans have seen their employment levels recover faster as they have emerged from the pandemic, observed Adam Kamins, a senior director of economic research at Moody’s Analytics. But he added that deeper structural issues — demographic patterns, the affordability of housing — have played a larger role in buoying growth in states like Idaho and Utah than any specific policies.
“You do see stronger job growth in Republican-controlled states for sure,” Kamins said. “But correlation is not causation.”
Among the fastest-recovering states, Kamins noted in one analysis, was North Carolina — the governor of which is a Democrat.
Republicans see matters differently. Seventeen of the 20 states with the lowest unemployment rates as of January are run by Republicans, noted Jesse Hunt, spokesman for the Republican Governors Association.
“That’s no coincidence,” Hunt said. “They enacted conservative policy solutions that allowed their states to recover faster from the pandemic than Democrat-led states.”
Governors have certainly made trade-offs during the pandemic between the health of their populations and economic growth, said David Cooper, an economist at the left-leaning Economic Policy Institute. Cooper noted that seven of the 10 states with the highest per capita deaths from Covid-19, including Oklahoma, had Republican governors.
“Is that really a win?” Cooper asked.
Others point out that infusions of federal money during the coronavirus pandemic, such as the CARES Act and the American Rescue Plan, have a lot more to do with bringing states back from economic disaster than anything individual governors have done.
“Basically it’s insane to say, ‘Our policies are good. Theirs are bad. Our unemployment is really low and our inflation is really high compared to the rest of the country,’ where unemployment is merely low and inflation is merely high,” said Betsey Stevenson, who was a member of the White House Council of Economic Advisers from 2013 to 2015.
Several economists we spoke with said that luck played a major role in how badly a particular state was hit by the pandemic — a complex equation influenced by demographics, population density and industry mixes.
One economist compared politicians’ claims about influencing the trajectory of the economy to “a rooster crowing at the dawn.”
‘Washington at its worst’
Republican governors have also been happy to promote specific investments made possible by the American Rescue Plan, Biden’s $1.9 trillion economic rescue package that passed last March, without noting the original source of the money.
DeSantis, for instance, said the plan was “Washington at its worst.” But he later talked up his proposal for a $1 billion gas tax holiday, along with bonuses for teachers and first responders — all of which relied on federal funds. On Wednesday, he unveiled nearly $300 million in spending for education without noting that the money came from Washington.
Florida’s state budget benefited from billions from the rescue plan alone: $8.8 billion in state and local fiscal recovery funds, $2.47 billion in child care stabilization and supplemental funds, $703.8 million in funding for K-12 education and $740.5 million in emergency rental assistance. Towns and cities in Florida also received $7.11 billion to help plug the holes the pandemic created in their budgets, along with $6.33 billion in education funding and another half a billion dollars in rental assistance.
The pattern is similar in other red states:
In Iowa, Gov. Kim Reynolds boasted about her state’s investments in broadband, housing and water quality — all of which came from the rescue plan.
Kristi Noem, the governor of South Dakota, used rescue-package money to pay for water projects, housing affordability and day care programs.
And Hogan, the governor of Maryland, has talked about federal anti-crime programs that were funded through the rescue plan, though he has said he would have voted against it.
“It’s absurd on several levels,” said Dean Baker, an economist at the left-leaning Center for Economic and Policy Research. “To trash a policy and then take the benefits of it — that’s a pretty high level of hypocrisy.”
Republicans see no contradiction between taking the federal funds while also criticizing the legislation. Some have said they had little choice but to accept the money, which otherwise would be sent back to the Treasury Department. They also have complained that Democrats’ decision to allocate funds in the rescue plan based on a state’s unemployed population, rather than its total population, unfairly punishes red states.
The Fed gets a vote
Democrats have been pushing Biden to take more credit for the economic recovery, hoping it will help them at the polls in November.
They got their wish during the president’s recent State of the Union address, when he said: “Our economy created over 6.5 million new jobs just last year, more jobs created in one year than ever before in the history of America,” calling it “the strongest growth in nearly 40 years.”
The U.S. economy indeed grew at a fast clip in the last three months of 2021 — nearly 7 percent — and the national unemployment rate is down to 3.8 percent.
But that might be about to change.
On Wednesday, the Federal Reserve forecast a sharp slowdown in the U.S. economy this year as it signaled plans to hike interest rates to combat soaring inflation — a reminder that politicians might want to be wary of taking credit for economic conditions that could shift quickly.
“This is a much bigger issue than one governor or even the president can manage, and the ways they can have influence aren’t all that popular,” Stevenson, the former member of the Council of Economic Advisers, said.
What to read
the former guy
Trump changes his tune
It was just a few weeks ago that Donald Trump lauded Vladimir Putin as a savvy genius. But the former president sees things somewhat differently now.
In an interview published on Tuesday night in The Washington Examiner, Trump said that he had expected Putin to make a “good deal” rather than invade Ukraine. He expressed disappointment in Putin’s decision, saying that the Russian president had changed.
Trump’s reversal on Putin comes as the country rallies around Ukraine. In Washington, members of Congress held back tears as Zelensky of Ukraine implored them to provide further assistance, and spent the afternoon debating what measures to enact.
And public opinion continues to show widespread support for sanctions against Russia by Democrats, Republicans and independents. Monmouth University released a poll on Wednesday that found that nearly 90 percent of Americans felt that Russia’s invasion of Ukraine was unjustified.
Thanks for reading. We’ll see you tomorrow.
— Blake & Leah
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