During the campaign, John Kasich liked to highlight the community of Wilmington as symbol to criticize Governor Strickland over the economy, going so far as making his first campaign ad for Governor to focus on the community. Wilmington lost 7,000 jobs when DHL announced that it was closing its domestic parcel air service in the United States in November 2008 (DHL acquired Airborne Express in 2003 and was given local and state incentives in 2003 to expand services in Wilmington).
Kasich promised that if he was elected as Governor, the kind of mass layoffs we saw during the great recession like Wilmington saw would not happen again. He promised a new way, new day.
So, how’s Wilmington doing? In 2009, Wilmington’s unemployment rate was 14.3%. What’s it now? 14.1%. So far, Governor Kasich hasn’t done anything, hasn’t even claimed to have done anything specifically for the people in Wilmington he promised to help if only they voted for him as Governor.
In fact, here’s a map of Ohio’s unemployment rates by counties:
But Kasich’s stopped something like the massive layoffs like another DHL, right?
Where’s Kasich been on BAX? Have you heard him mention a word of this since this massive layoff was announced? Nothing. Kvamme? Nothing. Not a word. If this is moving at the “speed of business,” we’re doomed.
We know that despite the spin by Governor Kasich otherwise, the June jobs report was downright depressing–unemployment went up in the State for the first time in nearly two years. In fact, if it weren’t for summer tourism jobs and stimulus-funded construction jobs, it could have been much worse.
Based on the weekly jobless claims for July at the time, I said we can expect that the July jobs report, due for release in August 19th, will likely be as bad, if not worse since Ohio was #5 in the nation for the week of July 9th in new weekly joblessness claims. Let me expand on my prediction, it is more likely than anything else that Ohio is about to see three straight months of a rising unemployment rate starting in June. The last time Ohio saw its unemployment rate go up three consecutive months was in… June 2009 as the recession officially wound down (employment is always a lagging indicator so it doesn’t really improve the same month the economy starts growing again.) In other words, Kasich’s taking us back into a recession-like joblessness environment.
C’mon, Modern, just how bad can it really be? I mean we can’t go from the second best recovery in our unemployment rate since 1983 to a backsliding economy in a span of three months, right?
According to yesterday’s Dayton Daily News, yes we can. Remember that from April to May, unemployment in Ohio stayed flat after dropping fourteen months in a row before starting to go back up in June. Notice the trend in just mass layoff (WARN notices) announcements. How’s July lookin’?
Last month’s layoff announcements were on pace to surpass the more than 41,000 layoffs announced in June by government and private employers, which was up about 12 percent from the previous month, based on figures compiled by Chicago-based placement firm and labor market tracker, Challenger, Gray & Christmas Inc.
“The private sector has pulled back a bit lately after coming out of the recession and creating jobs, and there’s no question that government is going to be a real drag on the jobs economy,” said CEO John Challenger.
But, Modern, is it really fair to blame Governor Kasich for this? Yes. There is no other area where a Governor has a direct impact on the economy than in the state’s budget. On that front, here’s more from the Dayton Daily News story:
Meanwhile, governments are also beginning to ramp up layoffs as widespread budget cuts begin to take hold.
State and local governments are forecast to shed up to 110,000 jobs in the third quarter this year, which would be the first time more than 100,000 government jobs were cut in a single quarter, according to a recent report from IHS Global Insight.
Keith Davis of Kettering was part of the June wave of layoffs that displaced more than 1,800 Ohio workers, up 22 percent from May.
“After a 15-year career working for the state, I never expected this,’’ said Davis, 43, who was laid off from his job as a police officer for the Montgomery Developmental Center, a Huber Heights care facility for the mentally disabled. “I left a job in Columbus working for the Department of Developmental Disabilities to be closer to my family. Now, me and my family are devastated.”
Okay, so maybe Governor Kasich was ideologically blind to the reality that his budget which cut billions from schools and local governments and led to massive state layoffs (something he and his Cabinet adamantly denied would ever happen under the budget when it was unveiled in March, in yet another lie by this Governor that the mainstream media refuses to call him out on and hold him accountable) would harm Ohio’s economy. I mean what warning did he possible have?
It’s not like there was some government memo or something giving him and the GOP-controlled General Assembly some warning that massive cuts in government spending would hurt the economy, right? Right?!
Who said that cutting government spending at the state and local level would be a drag on the economy in Ohio? Only the Ohio Governor’s Economic Council in February 2011. Where did we find this quote? Oh, it was only buried in the Governor’s Executive Budget on page B-3 under that obscure budgetary chapter called “Economic Overview and Forecast.” In other words, one of the fundamental economic assumption of the Kasich’s “Jobs Budget” is that it will be a drag on the economy, but they still have optimism that seeing neighbors lose what are generally considered somewhat economic sheltered “safe” government jobs won’t cause a panic of jobs insecurity among their private sector counterparts, thus drying up consumer spending. Instead, they think that while the government reduces spending and layoff people, consumers will spend more.
The Kasich budget is predicated on continued, modest growth fueled by consumer spending and business equipment purchases. If that doesn’t occur, Kasich’s budget develops… a…. *gasp*… deficit.
How’s consumer spending doing?
Hey, how’s manufacturing doing?
Why did manufacturing slow down? There was a significant drop in new orders from businesses. In other words, two of the most major areas where the Governor’s economists predicted would drive growth are shrinking.
What does this mean? Well, first it means there could be a chance that the State incurs a budget deficit if the economy slows down enough that revenues come in under the estimates which, again, were based on consumer spending and new orders for business equipment keeping a steady, consistent, strength in the economy. They also expected from June 2011 until June 2012 that unemployment would drop at least .5%. It’s gone up .2% already.
So, folks, what do you think Governor Kasich will do if the economy underperforms and that creates a deficit in his budget?
And now you’re starting to see the cycle of Kasich’s mishandling of the economy.
Governor Kasich isn’t getting the jobs done.