Surprise! 'Pro-business' policies hurt state economic growth [View all]

[Damansarajaya]

http://www.latimes.com/business/hiltzik/la-fi-mh-surprise-probusiness-20140506-column.html

As Menzie Chinn of the University of Wisconsin has now shown, the problem is that pro-business policies don't really contribute to economic growth. They just make the rich richer, which is not the same thing at all.


. . . .

does a high ALEC ranking translate into high growth? That's the question Chinn asked. He started by measuring private nonfarm job growth in four states--California, Wisconsin, Kansas, and Minnesota--dating to January 2011, when all four got new governors. Scott Walker of Wisconsin and Sam Brownback of Kansas were extremely ALEC-friendly, Jerry Brown of California and Mark Dayton of Minnesota were not.

Here's what he found, in a nutshell: "Kansas and Wisconsin, ranked 15th and 17th in terms of the ALEC-Laffer Economic Outlook Rankings, are doing equally badly relative to US employment growth. In contrast, Minnesota (ranked 46th) is outperforming the United States and those two states...What about California? It is ranked 47th by ALEC-Laffer, and yet is doing the best in terms of employment amongst the four states." Chinn's graph of the four states' job growth accompanies this post.


As he observes, the most radical pro-ALEC governor is Walker, whose tax-cutting and anti-union zeal has propelled him into the race for the GOP Presidential nomination for 2016. His state's economic performance has been dismal, as ALEC's own figures show.