Category Archives: Economics

Eckstrom declares stimulus failure after 13 days

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I saw that among the gov’s appointments on his public sort-of schedule was a briefing from S.C. Comptroller General Rich Eckstrom, having to do with the stimulus. The schedule didn’t say when or where said meeting would take place, but maybe it was today, since we now have this report:

Eckstrom: Revenue down 10% in June; stimulus not working

Monday, 13 July 2009
Staff Report

COLUMBIA — State general fund revenues for June were down 10%, or $71.7 million, compared with revenues for June 2008, evidence that the stimulus funds are not having the desired effect, S.C. Comptroller General Richard Eckstrom said.

For the past 12 months, the general fund revenues were down 12.5%, or $828 million, Eckstrom said.

“While everyone wants to see our economy improve, these revenue numbers indicate that it’s just not happening, even months after the president’s trillion-dollar stimulus spending bill. State and national unemployment rates keep climbing higher, so there’s certainly no evidence that jobs are being created or saved through the massive deficit spending that’s occurring in government,” he said.

How do you like that? We finally get the full stimulus coming to us after months of his ally doing all he can to stop it. It was to be spent in the budget that started 12 days ago, on July 1.

But ol’ Rich has already declared it a failure on the 13th. How about that?

You don’t suppose that, like some folks of the other party with regard to Iraq, he wants us to fail — do you?

SC (official) jobless rate rises to 12.1%

S.C. unemployment in May rose to 12.1 percent, compared to 9.4 percent nationally — officially. This leaves us tied for third-worst nationally, again (Michigan and Oregon are worse). And one economist notes that the true picture is worse than that:

Coastal Carolina University economist Doug Schunk said the true unemployment picture is around 19.9% for the state and 16.4% for the nation, when factoring in people who have given up looking for work and people working part time for involuntary reasons.

Encouraging, huh?

I found it interesting to learn that I live in the county with the lowest unemployment rate in the state — Lexington, at 8.1 percent. Of course, when you’re one of those who have been laid off, that’s not much comfort.

And oh, I just found a more complete version of the story, by AP’s Jim Davenport, at Forbes.com.

Imagine there’s no traffic; it’s easy if you try…

Earlier this morning I got into one of those blue-sky conversations with someone else who dreams about a light rail system for the Midlands, and it reminded me of this post from last year, in which I quoted in turn from a column I wrote back in 1998 on the subject:

Imagine: Say it’s a few years from now, and you live in Lexington and work in Columbia. You drive the mile or so to the station and leave your car in a parking lot. You take your seat and ride the old Southern line that parallels Highway 1 into the city. Call it the A line.
Despite all the stops, you get downtown in less time than it takes to drive, while getting ahead on work or (better yet) reading the paper. You change trains at the Vista Center station near the new arena and conference center.
Say you work where I do, near Williams-Brice Stadium (and why wouldn’t you; this is my dream, after all). You take the C line down one of the very tracks that used to frustrate you in your driving days (if you can’t beat the trains, join them). You get off within a block of work.
A few hours later, when you have a lunch appointment in Five Points, you take a quick ride back up to Vista Center, then through the underground stretch beneath the State House complex and the USC campus on the eastern reach of the A line.
Need to shop after work? Take the C all the way out to Columbiana, or the D along Two-Notch to Columbia Mall. (Where does the B line go? Out toward Lake Murray, which means it runs between 378 and the Saluda River, right by my house.)

The amazing thing about that original column is that it was written years before I had the chance to ride on the NYC system, which is the one I love the most, because it is the most extensive I’ve ever been on. The systems in Atlanta and Washington are nice, but the NYC system is such an organic part of the city, with such magical properties — you descend into it, and moments later you emerge into a different world.

In the last few years I’ve gone out of my way several times to go to New York mainly to ride the subways. I like to do other stuff — walk across the Brooklyn Bridge, for instance. But the key to everything I do is the transit system.

This morning, Nathan Ballentine wrote on Twitter that I-26 was “backed up like a parking lot” to Lake Murray Boulevard. How much better to be able to spend that time on a train reading the paper, coming in from Irmo, or the Northeast, or Lexington. And then to get around from Five Points to the Vista to wherever without having to hunt for convenient parking?

It would be wonderful. And it’s worth dreaming about, and enduring the scorn of those who keep saying it will never happen. Imagine there’s no traffic; it’s easy if you try…

Time-Warner spins off AOL, restoring order to the universe

Did you see this news?

Time Warner to spin off AOL, ending ill-fated deal

By RACHEL METZ – AP Technology Writer
NEW YORK — Time Warner Inc. is dumping AOL after spending nearly a decade trying to build a new-age media empire only to wind up in a weaker position than when the marriage began.

The divorce, announced Thursday, will spin out AOL as a separate company run by former Google Inc. advertising executive Tim Armstrong. He was hired in March to try to restore the luster to a brand once known as America Online.

Although AOL has been eclipsed by Google and other Internet stars, Armstrong still can try to build on a wide-reaching online ad network as well as AOL’s Web sites, which remain a relatively big draw.

I’ve always looked at the deal where AOL essentially bought Time-Warner as the ultimate example of the Dot.Com bubble’s madness. And this isn’t me as an old-media guy being phobic about new media. The problem was that AOL was lame new media. I mean, AOL wasn’t anywhere near the cutting edge of dot.com at the time, but rather a relic of the early dialup days of the PC. It was, as I recall, actually sort of late to the Web.

And here it was swallowing Time-Life and Warner Brothers and cable TV and all those old media giants, which still had demonstrable value. It just didn’t make any kind of sense.

And now, for some time, Time-Warner has been trying to rid itself of the death-grip of AOL. Which for me, sort of restores some order to the universe.

Blessed are the poor…

… because they give more generously than the rich, according to the U.S. Bureau of Labor Statistics. Did you see that story?

Indeed, the U.S. Bureau of Labor Statistics’ latest survey of consumer expenditure found that the poorest fifth of America’s households contributed an average of 4.3 percent of their incomes to charitable organizations in 2007. The richest fifth gave at less than half that rate, 2.1 percent.

The figures probably undercount remittances by legal and illegal immigrants to family and friends back home, a multibillion-dollar outlay to which the poor contribute disproportionally.

None of the middle fifths of America’s households, in contrast, gave away as much as 3 percent of their incomes.

Did this surprise you? It didn’t me — at least, not after I thought about it for a moment. It’s the identification thing. The more affluent one is, the more likely one is to think of the poor as the “other,” to think of poverty as “a way you’ll never be.” This can lead one to think there must be something wrong with the poor on a moral level — that they’re lazy and just don’t try or whatever.

Not that I’m a paragon of sensitivity or anything, but I’ve never had that attitude, mainly because God blessed me with a tendency toward depression. He’s given me a taste of what it’s like to feel overwhelmed and unable to meet the challenges before me. Just a taste, mind you — I always manage to cope, and have never had that crippling kind of despondency that keeps people in their beds. But I’ve seen through that door, and I can easily see how dysfunctional I’d be if I’d never been successful at anything, had no education, no home, no real prospects. In fact, it causes me to marvel that people who are down and out manage to do ANYTHING, as so very many do.

So I didn’t really need to get laid off to see into the abyss, but now that I’ve had THAT experience, and am still having that experience — no permanent, full-time job with benefits at hand yet — I’m less likely than ever to be dismissive of the plight of the poor.

That AP story raised another interesting explanation for the relative generosity of the poor:

Herbert Smith, 31, a Seventh-day Adventist who said he tithed his $1,010 monthly disability check — giving away 10 percent of it — thought that poor people give more because, in some ways, they worry less about their money.

“We’re not scared of poverty the way rich people are,” he said. “We know how to get the lights back on when we can’t pay the electric bill.”

Now there’s an instance in which I do suffer from a malady of the bourgeois: I do have that middle-class horror of not being able to pay the bills. The prospect, which gets closer each day that I don’t have a steady job, is more than a little appalling. There’s that middle-class voice in my head that goes, “The electricity turned off? OHmyGod, NO!” Whereas Herbert takes it in stride, and keeps on giving.

Which ought to teach us something.

A “garnet-red teardrop falling from the cheek of the future…”

Dan Neil won the Pulitzer in 2004 for his automotive column in the L.A. Times, and you can see why in his piece earlier this year about Honda’s hydrogen car, the FCX Clarity. A colleague shared it with me today, and I just had to share it with y’all — both in the interests of promoting talk about hydrogen and alternative fuels, and just to celebrate the words. A sample:

Perhaps obscured by questions of practicality and cost is the fact — and it is a fact — that the FCX Clarity is the most beautiful car to ever wear the big H on the nose. It’s just gorgeous, a big garnet-red teardrop falling from the cheek of the future, a sweet stanza of robot-written poetry.

You might be able to infer from that passage that Mr. Neil was essentially trashing the practicality of hydrogen elsewhere in his piece. His objections ranged from the general — the energy cost of producing hydrogen to start with — to the specific, which in this case involves pointing out that each one of these little beauties costs Honda $2 million to make. He reckons that a large part of Honda’s motivation is simply to reach California’s quota for emission-free cars sold by 2014.

But not entirely. As he acknowledges, Honda is learning some practical lessons from this exercise. Mr. Neil argues that the future is more likely to involve plug-in electrics (and I find that persuasive, which is why I’m anxious for Detroit to start mass-producing the affordable electrics it already knows how to make, and for clean nuclear plants to start popping up to power them). But Honda is learning a lot about how to better make those from making these:

The second reason Honda might have had for building the FCX Clarity: Nothing invested in this project goes to waste. The car’s state-of-the-art fuel cell can be amortized in Honda’s portable power generation division (the company makes awesome generators). And since a fuel-cell vehicle is essentially an electric vehicle with a hydrogen heart, all the technology — the glossy aerodynamics; the powerful, quiet and compact 100 kW (134 hp) electric motor; the new space-saving coaxial gearbox — can be rolled into future electric and plug-in electric projects.

And it has loads of interior space and a huge trunk.

Me, I’m all for efforts such as Honda’s, and if it takes a little utopian prodding from California to make it happen, then great. The Left Coast has gotta be good for something, right? What I generally hear from hydrogen experts is that automobiles are unlikely to be the most practical application, but they do dramatize the possibilities. And you learn from trying to build them.

Beyond that, I’m reminded of something I learned at Rotary Monday. Our speaker was the manager of the new Starbucks roasting plant in Sandy Run. He explained why Starbucks uses only arabica beans grown above 4,000 feet — such conditions make the plant work harder to grow and produce “cherries,” and that makes the coffee better.

The harder we push on hydrogen and every other promising source of power other than oil from countries run by tyrants, the better the result is going to be. So we need to keep pushing. In California, that means making “unreasonable, impractical” demands on automakers. (And maybe it will soon mean the same thing in Washington, with the gummint taking a big role in running Detroit.) And in South Carolina, it means continuing to push to be at the fore of hydrogen and alternative fuel research.

Just for fun, while we’re on the subject, here’s a link to one of my most popular videos ever, the one I shot in Five Points on St. Patrick’s Day 2007, the critically acclaimed “Who Resurrected the Electric Car?”

Don’t do it, Nikki!

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Someone just brought this to my attention:

In the latest bombshell to drop in the 2010 race for the GOP nomination for governor, Rep. Nikki Haley is running, according to multiple sources close to WR.

Haley, who would be the “Sanford candidate” that S.C. political observers have been waiting for, has allegedly been telling friends that she is running and is starting to build a campaign staff. Earlier, it was rumored that she might have been a possible candidate for state treasurer.

As of right now, it is unknown who she is going to, to run her campaign. She is also in a bit of a hole, with U.S. Rep. Gresham Barrett and Atty. Gen. Henry McMaster both sporting about $1 million in their respective war chests. As of her last disclosure report, Haley has only a little over $36,000 in the bank.

Candidates are already lining up to run for her House seat, including 2008 Senate candidate Katrina Shealy.

… and something just fell into place for me. I ran into Nikki at Starbucks a couple of weeks ago, and she introduced me to “Caroline” from her campaign. (At least, I think it was “Caroline.” Very young, even standing next to Nikki. That MIGHT be her in the background of the photo at this link.)

To which I responded, “Campaign? Already?” To which Nikki laughed a sort of “you know how it is” laugh. And I went away accepting that even for S.C. House members, the race has become this perpetual.

But maybe that wasn’t it at all, huh? Maybe Nikki was planning a big move.

I hope not. I like her as a House member, even if she does vote with the governor. I like that she actually tried to reform payday lending, for instance.

But if she ran as the “Sanford candidate,” that would just be too awful. I don’t want a nice person like Nikki to run as the “Sanford candidate.” I don’t want ANYBODY to run as the “Sanford candidate.” The very idea of there being even the slightest possibility of a continuation of these eight wasted years is appalling.

The whole point of the 2010 election is that we finally have the opportunity to get a governor who believes in governing. It’s the whole point, people. It’s why I started writing columns about the candidates as soon as they started emerging, much earlier than I normally would. We’ve got to get this one right.

Just keep repeating, folks: “We won’t get fooled again.”

Don’t compromise

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Eight days ago, I went backstage at the Koger Center to thank producer Todd Witter for asking me to be on “Whad’Ya Know?” Then I went out on the stage itself, where Michael Feldman was perched on the apron (or whatever you call the very edge), shaking hands, signing autographs and posing for pictures with fans.

While I waited for a break in which to thank him too, some of the fans broke off and spoke to me, congratulating me on my performance, such as it was. People are really polite that way, you know. Anyway, one of them was Elizabeth Rose Ryberg, who happens to be married to Sen. Greg. She was quite gracious as always, and complimentary, but at one point she remonstrated with me in the kindest way, suggesting I shouldn’t be so rough on “Mark” — the governor, that is.

Not that she thought the governor was completely right in his refusal to request our state’s share of stimulus funds. In fact, she noted that her husband and Tom Davis had been working hard to bring about a compromise between the governor and legislative leadership on the issue. This surprised me slightly at the time, since I had thought of Sens. Ryberg and Davis as being two people in the governor’s corner if no one else was. After all, they had recently stood up with him at a press conference to support his position (although I had noticed that they had not stood very close to him in the photo I saw — and take a look at that expression on Ryberg’s face — that’s him at the far right).

But it makes perfect sense that even people who share the governor’s political philosophy would want to pull him in a direction away from the position he’s taken — especially if they are his friends.

A few days later, Sen. Davis and Ryberg went public with their “alternative budget” in an op-ed piece in The State. They say all this confrontation is unnecessary, that they can balance the budget and avoid teacher layoffs and prison closings without a dime of the disputed stimulus money.

You know what? I have not idea to what extent their numbers add up, because frankly I find budget numbers to be a form of math far more slippery than Douglas Adams’ satirical “Bistromath.” I’e seen lawmakers resolve budet crises on the last day of the legislative session, with a puff of smoke and a “presto — we found more money!” — too many times. But I know that Tom Davis and Greg Ryberg are perfectly sincere. I trust their intentions; I know they believe what they’re saying. They’re good guys — I refer you to what I’ve said about Tom and about Greg in the past.

But to the extent that they are trying to find a way to compromise with the governor, I say thanks but no thanks. Aside from their efforts, I’ve heard others speak of compromising with the governor on the stimulus — say, let’s just spent this much, and then use this much to “pay down debt.”

But there are two really big reasons not to go along with that, reasons not to compromise with the governor’s position in any way: First, whether you think the stimulus bill passed by the Congress was a good idea or not (or well-executed or not), South Carolinians are going to be paying for it, and need to get maximum benefit out of it. And as Cindi Scoppe pointed out in her column Sunday, no sane person would pass up the chance to keep a few more of our public servants working and paying their bills for a couple of years, rather than on unemployment, to help us get through this rough patch.

The second reason is this: The governor is WRONG. He is philosophically wrong, and he uses bogus numbers (I refer you again to Cindi’s column) to support his rather sad arguments. This man does not believe in the fundamental functions of state government. He is openly allied with people whose goal is reduce government to a size at which it can be drowned in a bathtub. He sees the size of government ratcheting downward (even though he claims, absurdly, the opposite), and his number-one priority is to make sure the ratchet sticks, that the cuts to essential functions in government are not restored. His insistence on using money that is needed now on something, ANYTHING other than immediate needs — even to pay debts that NO ONE expects the state to pay at this time — is essential to the permanent reductions he seeks. The last thing he ever wants is for the state to be rescued by any sort of windfall.

And that point of view needs to be rejected, flatly and clearly. No compromise with a position so wrong should even be contemplated.

First the Hardwarehouse, now Hiller

I’m sort of enjoying getting the daily business updates from Mike Fitts, which I just signed up for last week. I cited Mike’s work yesterday, and now I come to share some sad news from 5 Points — Hiller Hardware’s going away.

An excerpt from Mike’s report:

An iconic business is heading out of Five Points. Hiller Hardware is planning to leave its longtime location at Blossom and Harden streets, making way for a new branch of BB&T bank.

If the deal goes through, BB&T will tear down the existing structure as part of a 30-year lease on the property, said Merritt McHaffie, executive director of the Five Points Association. The plans will be discussed at the May 5 meeting of the city’s Design Development and Review Commission….

Columbia City Councilwoman Belinda Gergel, who represents Five Points, said she’s been a longtime Hiller customer, buying a wide variety of items, such as rakes or candles….

Hiller has been at its Five Points location since 1951 and in business in Columbia for almost 70 years. A Lady Street location closed during streetscaping there several years ago….

He went on to report that the family business MIGHT open elsewhere, but that’s by no means certain.

The problem is the big-box hardware retailers, and I must confess that I am part of the problem because I’m a regular customer at Lowe’s. My wife, on the other hand, used to always go out of her way to do business with Ace Hardwarehouse in the Park Lane shopping center in Cayce — which closed last year.

That was another local landmark. It was also a prized advertising customer of The State. Once, years ago, a previous publisher decided that we non-business types on the senior staff needed to shadow some ad sales reps just to learn what they did. The rep I was assigned to took me first to the Hardwarehouse, where the owner or manager was so into his newspaper ads that he would put them together himself, pasting bits of file art onto posterboard at a drawing table in his office.

Yeah, the newspaper makes big bucks from big boxes (although not as big as in the past). But an important part of the community that has been dying and taking newspapers along with it consists of businesses like Hardwarehouse and Hiller. And it’s a shame to see them go.

Why do Democrats resent Barrett helping on the stimulus?

The thing I noted in my previous post has gone a step further:

Columbia, SC– South Carolina Democratic Party Chair Carol Fowler issued the following statement today in response to Congressman Gresham Barrett’s meeting with Columbia City Council regarding the American Recovery and Reinvestment Act. Earlier this year, Barrett spoke out against the federal stimulus bill, and he joined the state’s other Republican members of Congress in voting against it, but today he said he supports stimulus funds for local governments.

“Gresham Barrett is showing himself to be hypocritical in his early campaigning for governor. He was vocal about his opposition to the stimulus, but now that this view has proven to be unpopular in our state he’s modified his stance.  That’s not going to work with voters in 2010.  The only thing we need to know from Mr. Barrett is whether or not he supports Gov. Sanford’s rejection of $700 million in stimulus funds primarily dedicated to public education. Decisions need to be made quickly to avert thousands of teacher layoffs and other deep cuts in our schools. South Carolinians don’t want or need another Republican governor who’s willing to play politics with the lives of real people.”

Maybe some of y’all could explain this to me: Why would Democrats resent Gresham Barrett, who had opposed the stimulus, now helping local governments get their share? Don’t they want him to do that? Or is criticizing a member of the other party SO important to partisans that they have to criticize the guy as “hypocritical” when he tries to do the right thing? In other words, is hitting the other side more important than S.C. communities getting the benefit of the stimulus.

It’s not even inconsistent. As rational people keep pointing out, the stimulus debate is over. Now it’s time to make sure that South Carolina gets its share of something that South Carolinians will have to pay for whether we get the benefit or not. This is obvious to rational people, whatever party label they wear — unless they are one of the dwindling band of Sanfordistas.

Those of you who have trouble understanding me when I talk about how parties foment conflict purely for the sake of conflict, see if you can understand me now. This is what I’ve been on about. Yeah, I agree that we don’t need another governor, of any party, “who’s willing to play politics with the lives of real people.” But isn’t that what you’re doing when you place criticizing the opposition ahead of making sure everybody’s on board in getting the stimulus funds to real people in SC?

Welcome to ‘Sanfordville’

Have you reserved your space at the “Sanfordville” tent city set to go up tomorrow at Finlay Park? Here’s where to sign up, and here’s the release I got about it today:

South Carolinians to protest Sanford’s refusal to use stimulus money for education and law enforcement with “tent city” near Governor’s Mansion

On Tuesday, April 7, concerned citizens from all over South Carolina will erect a “tent city” in Finlay Park (Taylor and Gadsden Street) near the Governor’s Mansion in Columbia. The “tent city protest” will run from 10:00 AM until midnight. The symbolic protest is in response to Governor Mark Sanford’s continued refusal to accept $700 million in federal stimulus money meant for public education and law enforcement. State leaders from both political parties predict that Sanford’s actions could lead to the firing of thousands of teachers and hundreds of prison guards.

South Carolina’s unemployment rate is currently the second highest in the nation and education and law enforcement budgets have already endured deep cuts.  Sanford has consistently ignored pleas from teachers, parents and law enforcement officials to use this funding to prevent disastrous consequences.

Special guests will visit the “tent city” throughout the day. A list of guests will be distributed by tomorrow morning.  Contact Brady Quirk-Garvan for more information at 843-743-5453 or Sanfordville@gmail.com

——————–

###

Yes, you’ve seen this before.

McMaster confirms the worst

… or, at least, does so to the extent that a mere Attorney General’s opinion can do. Basically, Henry says the Clyburn amendment can’t bypass Gov. Sanford, on account of the 10th amendment.

There also seems to be some separation of powers stuff going on. Here’s a copy of Henry’s letter, which says “the General Assembly itself may not coerce the executive branch to act in accordance with the legislative will.

James Clyburn, meanwhile, is ticked:

ECONOMIC RECOVERY DEBATE: CLYBURN STATEMENT ON McMASTER OPINION
WASHINGTON, DC—House Majority Whip James E. Clyburn today responded to an opinion released by South Carolina Attorney General Henry McMaster about the interpretation of the so-called “Clyburn workaround amendment,” Section 1607 in the American Recovery and Reinvestment Act.

“Today the State of South Carolina added another chapter in its ongoing effort to maintain a standard of minimally adequate education.  For over 100 years, the last 20 in state courts, leaders in our state have fought to uphold that standard.  Over the last several weeks and without even going to court—the proper venue to determine constitutionality of federal laws—Attorney General McMaster, Governor Sanford and Senator Graham have gone out of their way to ensure that South Carolina continues its long history of providing a minimally adequate education.

“Rather than renewing the age old debate over States’ Rights and the Tenth Amendment of the U.S. Constitution our leadership should be seeking common ground to provide our schools the funds they need to retain teachers and maintain healthy, safe buildings in which our students can learn.

“What makes ‘state stabilization’ funding different from the funding Governor Sanford has authorized to rebuild highways or increase unemployment checks?  Why aren’t Attorney General McMaster and Senator Graham calling on Governor Sanford to use the very same pen to accept the state stabilization money—which our taxpayers are providing—to retain teachers and give our state’s schools the opportunity to move beyond their minimally adequate legacy?”

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If you ask me, there’s a lot more going on here than some sort of Democrat-vs.-Republican tug of wills over “minimally adequate” schools. But then, Rep. Clyburn didn’t ask me.

Neither, obviously, did the governor. So what do we do now? I don’t know. Maybe y’all have some ideas.

Higher education funding in S.C., by the numbers

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By BRAD WARTHEN
brad@bradwarthen.com


For once, let’s start off with some numbers and dates:

· 17 percent – the amount of the University of South Carolina’s funding that now comes from state appropriations. Our state’s major research universities now get less than a fifth of their funding from state appropriations. In recent years, those in the know have stopped calling them “state institutions” and started calling them “state-assisted.” We’ve now reached the point at which even that seems like an overstatement.

· 1st – South Carolina’s ranking in percentage of higher education funding cut last year. South Carolina, before the December and March reductions, had cut 17.7 percent from higher education budgets. (After those cuts, it has slashed higher ed budgets 24 percent.) The second worst state was Alabama, at 10.5 percent.

· 38th – Our state’s ranking for higher ed funding before the past year’s nation-leading cuts.

· 1995 – The last year that state appropriations, as a dollar amount, equaled the current level, before adjusting for inflation.

· 1973 – The year that matches the current level of funding, once you adjust for inflation. (Think for a moment what North Carolina and Georgia have done in higher education since 1973, pulling light years ahead of South Carolina.)

· $29 million – The value of one grant (from the National Institutes of Health) brought in by a single one of the 13 endowed chair holders at the Medical University of South Carolina.

· 25 – New technology companies started by USC faculty in the years since the endowed chairs program started, which places the university 19th among public institutions in the nation in number of start-ups.

· 50,000 – S.C. jobs provided directly or indirectly by USC.

· 11 percent – South Carolina unemployment rate in February.

· 43rd – South Carolina’s national ranking for percentage of adult population with college educations.

Those are a few of the figures I picked up from the presentations that Clemson President James Barker, Medical University of South Carolina President Ray Greenberg and USC President Harris Pastides (joined by Garrison Walters, executive director of the state Commission on Higher Education) made to a joint meeting Wednesday of two Senate panels that deal with higher education funding, such as it is.

They were there to try to stop the bleeding, and to send the message that dealing a further blow to these institutions’ already last-in-the-nation funding by not accepting federal stimulus funds would be beyond insane (my wording, I hope you’ll note, not theirs).

In some cases, they had requests that bore specifically upon their respective institutions. For instance, Dr. Greenberg’s wish listed included a request that if tuition is capped, graduate and professional programs will be exempted. But in keeping with the extraordinary collaboration that has marked the interaction of the three presidents in recent years (which is no less than miraculous, given the petty, wasteful, tit-for-tat competition that characterized the decades that went before), he also cited priorities shared by all: Regulatory relief (which President Barker has explained as minimizing cost by requiring the schools to jump through two or three hoops instead of six every time they make a move); a state bond bill for capital needs; and passing the cigarette tax increase, with a major portion of the revenue going to Medicaid. OK, so maybe that last one has the most immediate effect on the medical university, but its benefits to the entire state are so obvious as to absolve it of parochialism.

And they had a sympathetic audience. “You’re number one in the country,” in budget cuts, Sen. Nikki Setzler noted. “If that isn’t a challenge to this committee to carry forward to the full General Assembly, then shame on us.”

Of course, Sen. Setzler is a Democrat, but that doesn’t count for as much of a difference in the S.C. Senate as it does in some venues. And when it comes to the federal stimulus upon which the GOP leadership is completely dependent for keeping essential state services running, there are only two sides – on one is Gov. Mark Sanford and a few allies to whom ideology is the only reality; on the other the vast majority of lawmakers.

Republicans don’t come more conventionally conservative than Senate Education Chairman John Courson, to whom Ronald Reagan was a demigod. And here’s what he had to say about the stimulus: “If we don’t accept that money, it does not go back to the Treasury; it goes to other states.” Which is just common sense, of course – nothing ideological about it. But this is a moment in South Carolina history when commonsense statements are in pathetically short supply, so every one uttered takes on added value. In an interview later, Sen. Courson explained the rationale adopted by most Republicans whose top priority is not posturing for national media: He opposed the stimulus bill when it was being debated in Washington. There’s a lot in it he doesn’t like; if he had been a member of Congress he would have voted against it. But that’s all over now. It’s a fact, and South Carolinians are going to be paying for it along with everyone else. Therefore, not taking the money makes no sense at all.

Tuition cost was on the senators’ minds, and well it should be, now that the bulk of higher education costs is on students and their families rather than state taxpayers. “I am pledging to keep any tuition increase for next year to a minimum,” said Dr. Pastides. “I’m keenly aware of the burden that a tuition increase would put on students and their families.”

But what happens with tuition depends upon the General Assembly’s actions – and the governor’s. “Will tuition and fees increase next year?” President Barker asked rhetorically. “The answer is: Almost certainly, but the level of increase is very dependent on what happens with state funding. Tuition is Clemson’s last-resort response….”

Mr. Barker pointed out that the effect of stimulus money on tuition is not direct, since he, like the other presidents, would use stimulus money for one-time, not recurring, expenses. But when asked by Sen. Harvey Peeler the expected effect upon the institutions of not accepting the stimulus money, the Clemson president said it “would be devastating.”

Other senators, seizing upon that word, asked other witnesses whether they agreed with it, prompting Dr. Pastides to oblige them by saying for the record, “It will be devastating, and it will have an effect on tuition” if the stimulus is blocked.

Normally, I’m not what you’d call a numbers guy; words are my thing. So I appreciate that the senators were groping for just the right word to describe the situation. But in this case, for once, the numbers impress me more. We are so far behind in our state. And if our governor has his way, we’ll take an additional giant leap backward.

This is my first weekly online-only column after leaving The State. Watch for more here on bradwarthen.com.

Sorensen on my last column

Former USC President Andrew Sorensen had the following to say about my last column in The State:

Dear Brad:

As one who has just embarked on a marked change in professional responsibilities, I wish you well in the next stage of your career, whatever that may be.

Thanks very much for your stimulating op-ed piece of March 22nd.  Although I was tempted to respond to each paragraph as well as the concluding suggestions, in the interest of brevity I’ll comment only on (1) “Improve our schools” and (2) “Let our colleges and universities drive our economy.”

(1)I couldn’t agree more with your recommendation that we “stop talking about nonsensical distraction, and fix the schools.”  We South Carolinians ought to be profoundly embarrassed by the quality of schools in our economically depressed communities.  It is imperative that all South Carolinians have an opportunity for the quality of education afforded at the many first-rate schools throughout our state.  Your suggestions for restructuring, if implemented, would do much to correct our current imbalance in facilities and human resources.

(2)During the past several years, the presidents of USC, MUSC and Clemson have made extraordinary progress in collaborating on the “cutting edge of wealth-creating innovation.” During this period of profound fiscal crisis the temptation is great to hunker down and look upon investment in this area as one of high risk that will yield principally future benefit, and is unlikely to be manifest in the next few weeks or months.  That admission will cause detractors to argue that investing in these programs in the midst of economic stringency is counterintuitive.  But the economic future of our state is heavily dependent on the highly skilled and scientifically sophisticated youth of today who will become the leaders of our state’s economy tomorrow.

All the best to you.

Sincerely,

Andrew A. Sorensen

Leatherman’s letter to Sanford

Folks, here’s a copy of the letter that Hugh Leatherman wrote to Sanford about the stimulus. Don’t know what to add except that his point, that South Carolinians will pay for this stimulus whether we get the money or not, is one that I heard Republican senators making yesterday at the State House.

Hardly seems worth mentioning because it’s so painfully obvious. To everyone but Sanford. Did you read the short item in the paper today about what Bobby Harrell had to say?

COLUMBIA, S.C. — House Speaker Bobby Harrell said Wednesday South Carolina lawmakers should prepare a budget without using federal stimulus cash unless Gov. Mark Sanford reverses himself and decides to seek the money.

“We’re probably not going to have that money with the governor not requesting it,” Harrell, R-Charleston, said. “It is time to write a budget that does not include that money.”

But Sanford spokesman Joel Sawyer said it is time for legislators to sit down with the governor and come up with a budget plan that uses $700 million stimulus cash the governor will control during the next two years to pay down state debt or forgoes the federal cash altogether through budget cuts. “So far, they’ve not indicated a willingness to do so.”…

That comment from Joel really gets me. He might as well say, “The governor has invited lawmakers to poke every citizen of South Carolina in the eye with a sharp stick, but so far, they’ve not indicated a willingness to do so…”

Sanford’s letter to Obama

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So that you might be fully informed, I pass this on. Can you see me rolling my eyes from where you sit?

You saw the story about Obama's response to the original request, right? The administration told the gov that the stimulus is supposed to be used to save or create jobs. To which it might well have added, "Duh!" Marvelous restraint on the administration's part there.

Anyway, here's the latest letter:

STATE OF SOUTH CAROLINA
OFFICE OF THE GOVERNOR
MARK SANFORD, GOVERNOR

March 17, 2009

The Honorable Barack Obama
President
United States of America
1600 Pennsylvania Avenue, Northwest
Washington, D.C.  20500

Dear Mr. President,

I'd first thank you and Director Orszag for your response of March 16 to my letter of the previous week.  Likewise, I have to express my disappointment that our substantive dialogue about the best way to adapt this stimulus to the unique situations of states across this country was interrupted by the Democratic National Committee's launching of a petty attack ad against us even before we had received your response.

I've made clear my opposition to using debt to solve a problem created in the first place by too much debt – and I don't believe this to be an unreasonable position.  What I find less reasonable is the way this DNC attack ad returns a nation indeed yearning for change back to the same old politics-as-usual.  Because I believe you and I share a common desire to escape this worn-out "attack first" mentality, I'd respectfully ask you to immediately condemn and put an end to this unnecessary politicization of a truly important policy discussion.

In the spirit of moving forward, I'd offer the following as a clarification to our using a portion of the stimulus funds to paying down our state's sizable debt.  With regard to the Education Stabilization Fund monies (ARRA § 14002(a)(1)) that must be used "for the support of * education," we think it would be consistent with statutory requirements to use this $577 million to pay down the roughly $579 million of principal for State School Facilities Bonds and Research University Infrastructure Bonds over two years.  This would immediately free up over $162 million in debt service in the first two years and save roughly $125 million in interest payments over the next 13 years, which could then be directed towards other educational purposes – just as paying off a mortgage early frees up the typical monthly payment for other uses.

Regarding the $125 million in the Fiscal Stabilization Fund (ARRA § 14002(b)(1)) headed to South Carolina, we'd lay out a few options for your consideration: first, paying down debt related to the state's Unemployment Compensation Trust Fund that currently exceeds $200 million and would directly impact those currently out of work in this struggling economy; second, paying down debt related to state retirees, since that would seem to satisfy the statutory requirement that these funds be used for "other government services"; or third, paying down other bonded indebtedness at the state level.

We trust these alternative proposals fit both the statutory requirements and spirit of the stimulus legislation.  Thank you again for your response, and we would again appreciate your opinion as soon as possible given that we believe this course of action will do more to ensure South Carolina's long-term economic strength than would other contemplated uses of the funds.

I also await your response on pulling down the attack ads.  A good part of your candidacy was fueled by the hope for change in the way political debate is conducted in our country.  On this, actions will speak louder than words – words you have been so gifted in delivering – in determining where you really stand, not as a candidate promising to deliver on change, but as a leader now capable of bringing this change.  I look forward to your response.

Sincerely,

Mark Sanford

cc:    The Honorable Peter R. Orszag, Director
    Office of Management and Budget

Thanks for all the kind words, folks

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    Yes, blog regulars, you did read much of this piece earlier in the week. But people who don't do blogs (a much larger number among newspaper readers) missed it, and there is some new material in it, at the beginning and the end. Not much, I'll admit, but some…

By BRAD WARTHEN
Editorial Page Editor
ONE OF THE tough things about getting laid off in a very public way is that you can’t get your work done — you can’t even walk down the street — for all the wonderful people who come up to you and say kind things. (Never mind the phone calls, e-mails and letters.)
    Of course, it’s also the best thing about the experience, so don’t stop, folks. It doesn’t get old.
    I’ve heard from everyone from Gov. Mark Sanford (yes, he was very kind and cordial, despite all those things I say about him) to old friends I worked with decades ago, far away from here. And I appreciated every one of them.
    For those of you who missed it, I was in the news last week, along with a lot of my colleagues. To quote from thestate.com:

    The State Media Co. today announced the layoff of 38 people — 11 percent of its work force — and wage reductions ranging from 2.5 percent to 10 percent for the rest of the employees.
    Among those laid off were three vice presidents including editorial page editor Brad Warthen.

    My last day is March 20.
    For those of you who ask “why,” the answer is simple: The money’s just not there, and somebody had to go. I was one of the 38. You might say, to borrow a phrase from the Corleone family, this isn’t personal; it’s strictly business.
    I’ve tried to keep readers on my blog in the loop about the profound changes going on in the newspaper industry, which have been accelerating. I’ve written about everything from the departures of longtime friends and colleagues who are not replaced, to the horrific news sweeping the industry more recently, with some newspapers going under.
    This has not been a comfortable thing for me to do. For one thing, I always wonder how much my readers will care. Someone I respected in college — actually, he taught a course in editorial writing that I took — warned us that when one talks about one’s own industry, one runs the risk of boring one’s audience.
    (So, what I try to explain when I do talk about it is that this is about you, too. Newspapers reflect their communities in more ways than simply publishing news and commentary. We also reflect our surroundings economically. Newspapers went into this recession in a weakened condition, and now we’re like the canary in the coal mine. If you’re hurting, we’re hurting. And vice versa, whether you realize it or not.)
    For another reason, I recognize my own lack of detachment.
    Finally, there is such a delicate balance to strike between telling all that I know or imagine I know, which is my instinct as a journalist, and respecting the confidentiality of things I know only because I’m an officer of this company — which gives me both an unfair advantage and a responsibility to those I work with. It can be awkward.
    Anyway, in spite of that, I’ve tried to be frank about the situation whenever I’m asked — and on the blog, even when I’m not.
    I leave here with a deep love for this newspaper, which I hope has been evident over the past couple of decades. It seems to have been evident to my boss — President and Publisher Henry Haitz — judging by the kind and gracious things he had to say about my service in his note on this page on Wednesday. (Sample: “He is a remarkable journalist and writer, with keen understanding of the issues most vital to our community and our state.”)
    And I appreciate that.
    What will I do next? I don’t know. I’ll be spreading my resume around, online and otherwise. In the meantime, give me a holler if you hear of a suitable position. One advantage I have over so many people who are looking for work now — more than 200,000 in South Carolina, I heard last week — is that a huge portion of the state has watched me on the job and formed a pretty detailed impression of my capabilities. (Of course, whether that works for me or against me depends on the individual reader.)
    I can tell you this much — I have zero intention of “relocating,” to use an ugly word. When I came to the state of my birth in 1987 after years in this business in Tennessee and Kansas, I did so with the intention of staying for good. My days as a newspaper vagabond were over. Either things worked out at The State, or I would find some other line of work. And the thing is, things worked out very well.
    The day I was interviewed here (for the job of governmental affairs editor), I told then-Executive Editor Tom McLean that my ultimate goal was to become editorial page editor. I believed that position offered the greatest opportunity to serve my state, which I believed needed its largest newspaper to have a strong, frank, lively editorial page. Thanks to Tom, I got my chance to do just that 10 years later, and I could not be more proud of the team I have had the privilege of working with, or the excellent job they have done — and that those who remain will continue to do, if I know them. (And I do.)
    Obviously, this is a stressful time, but beneath it all is something that I don’t quite know how to describe, a sort of anticipation driven by curiosity. I wonder, with great interest, what will happen next. (That sounds either terribly trite or unintelligible; I can’t tell which, but I explained it as well as I could.)
    So much for this subject today. This will not be my last column. For one thing, I promised you last week to write something about U.S. Rep. Gresham Barrett’s candidacy for governor. I was going to do that for today, but I got distracted again. I’m sure you’ll understand.

For now, please visit thestate.com/bradsblog/ for more about this subject and everything else. Watch there to learn about my future blogging plans.

I infiltrate the unemployment system

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How dedicated am I to my craft? This dedicated: with the conflict between the governor and the Employment Security Commission being a burning issue in our state, I went and got myself laid off so I could go undercover and find out how the unemployment system in this state really works. I'm a regular Alec Leamas or something. That's my story anyway.

I learned an awful lot about it today — so much that I'm too tired now to sort through it all; I'd be writing all night. But it will produce a lot of fodder for the blog in the coming days, I expect. For tonight, I'll just pass on this tidbit…

The State invited representatives from various agencies who provide unemployment services — Employment Security, Commerce, and another program that I need to go back and clarify under which umbrella it falls — out to the paper to get the 38 folks laid off started on filing for help in finding a job, retraining, and getting those checks the ESC processes if you don't find a job right away. (And believe me, those checks are so small that you don't want to be unemployed and dependent upon them for five seconds more than absolutely necessary; they're a tremendous motivation to find a job.)

I spent about three hours with these various folks, and took copious notes. And I want to say that they were all very helpful and knowledgeable and professional and encouraging, which really helped me learn a lot for only three hours spent.

But you should get a chuckle out of this part: Someone was explaining to us about WorkKeys. Do you know about those? Basically, you take a battery of aptitude tests, and you get scores on a range of skills, and employers tell the gummint they want X number of workers who have scored at least a 4 in each category, or whatever, and you get matched up.

The gummint administers the test for free, and will even help you get training to get a higher score where you're lacking. You get certified, I think he said, with a rating of Bronze, Silver, Gold or Platinum. (There aren't many platinums, he said.)

But here's the best part. He said, "You also get a certificate, signed by the governor, saying that you are work-ready."

Now see, if I'd known this yesterday when the governor called me, I could have saved myself the time it will take to take those tests. I could have pointed out that if anybody knows what I am capable of, it's the governor. He probably would have whipped me out a certificate of work-readiness on the spot. So I guess I missed my chance.