May 06, 2007
Public Support for Job Creation, but Not the Future Workforce?
U of M professor Ann Markusen has an op/ed about tax incentives to promote job creation in yesterday's Star Tribune. She lays out the arguments against incentives in some detail, says a majority of economic development scholars support incentives, and then proposes some state-level reforms.
An excerpt from her forthcoming book, Reining in the Competition for Capital: International Perspectives, is available here. Of course, job creation initiatives by business also require capable workers and adequate public infrastructure. Yet productivity-enhancing government investment faces declining support in some of the same states offering business relocation incentives.A New York Times article suggests that America's religious, ethic and racial diversity may account for some of the nation's relative antipathy toward government spending. More homogeneous countries exhibit less resistance to spending for the common good.
In America, government spending on social transfers — everything from food stamps and unemployment insurance to health care and pensions — is about a third less than it is in Italy, France or Belgium, when expressed as a share of the economy, according to data from the Organization for Economic Cooperation and Development. And it is about half the level of Sweden’s. Moreover, Americans pay less in taxes than the citizens of nearly every other wealthy nation in the O.E.C.D.
Could this diversity argument apply even to Swede-influenced Minnesota? Has the last several decades' influx of Hispanics, African-Americans, Hmong, Somalis and other non-Anglo citizens influenced the claims that we are spending too much on public education and transportation, that government is wasteful and ineffective, and that personal responsibility is the solution to poverty and inadequate health care?
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