tag:blogger.com,1999:blog-30130444.post4862591196220800093..comments2024-02-16T09:00:32.845-06:00Comments on FromDC2Iowa: Iowa's Budget Cuts and the UniversityUnknownnoreply@blogger.comBlogger2125tag:blogger.com,1999:blog-30130444.post-61136942447907484512009-10-09T11:56:36.158-05:002009-10-09T11:56:36.158-05:00Last fall, Nobel Prize winner, Princeton economist...Last fall, Nobel Prize winner, Princeton economist, and NY Times columnist Thomas Freidman made this important point in a column and in his new book: There are 50 Hoovers out there who will hunker down and cut fiscal stimulation in their individual states, thus worsening and prolonging the recession.<br /><br />Do Governors have economists on staff? It sounds ridiculous and naive for a Gov like Chet Culver to blame the economy and unemployment for his state's financial woes, then to turn around AND ADD TO THE PROBLEM BY LAYING OFF WORKERS.<br /><br />The same point can be made at the Univ of Iowa for instance, that sees things on a short term basis, lays off workers to protect their profits, and thus will prolong the economic troubles (what me the CEO worry about the blue collar guy?).<br /><br />Obviously these poor fiscal policies will likely stall the tenuous recovery, add to unemployment and continue the downward spiral. Govt will start running out of money to stimulate the economy, certain posturing factions will enjoy failure, and there is a 50/50 chance of the years between 1929 and 1939 being recreated.<br /><br />Will CEOs and administrators recognize the problems. Fat chance? Their actions are not without morality, but a morality that exists for self gain, or pleasing the next highest administrator. Thus new and creative thinking will be stifled, everyone will hunker down to protect their salary or their job, and programs of cost cutting will be announced and worshiped. This is clearly 'top line' budget corrections, that is improving paper performance by cutting costs. The bottom line, improved with innovation, creativity, and production gains will not be affected. The short term looks good, The CEOs will continue to make alot of money that pads their own personal situation, while really damaging the economy in a micro and macro way. But hey, their bank accounts are good. Life is good at the top.<br /><br /><br />Friendman sees this as the result of a shift in resources away from the middle class and into the upper class, started with the Reagan revolution and seen at a microeconomic level at the U of Iowa. The fat CEOs will get fatter, meanwhile the middle class - suffering from cut job hours, increased tuition, higher energy prices, less overall net worth, will be slowly ground into dust.<br /><br />Their would be a couple ways this might not happen.<br /><br />1. A visionary leader may supply leadership rather than management. Skorton might be a man do do this. Current administrators and Govt will not exercise this broad view.<br /><br />2. There might be enough economic activity in Iowa to somehow pull the economy along to avert a prolonged recession.<br /><br />It will be interesting to see what happens. However, there is little evidence that current leadership has any motivation to treat the issues in a moral and actually economically sound way. They tend to be self-aggrandizing and filled of self -importance and entitlement...not traits needed for a leader to act with the greater good in mind.<br /><br />Times could be tough, and Iowa may never recover quite to the old standards of living.<br /><br />Look to the years of 1929 to 1939 for the dangers that lie ahead.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-30130444.post-64499657170141144382009-10-09T09:42:15.549-05:002009-10-09T09:42:15.549-05:00So what do we do to fix the problem? Is there anyt...So what do we do to fix the problem? Is there anything besides imploring our representatives to stop fighting over the color of another's tie and do their jobs? And I mean that in the most sincere fashion.Ginnyhttps://www.blogger.com/profile/12882044009021436079noreply@blogger.com