The pronouncements of Dr. Randall Podenza, an economist associated with the right-wing Cascade Policy Institute, usually leave me scratching my head. But his latest one had me wanting to ram it into a wall.
Podenza’s thesis boils down to this: More driving = more prosperity. As reported on the Oregon Catalyst blog, Podenza’s study “finds that ‘VMT [Vehicle Miles Traveled] is a large and statistically significant driver of GDP [Gross Domestic Product]’ and cautions that artificial attempts to limit driving through taxation or regulation will cause a significant decrease in economic output.”
CPI President John A. Charles Jr. declared: “If Oregon politicians believe in job creation and increased household income – as almost all claim they do – then they also have to be in favor of increased automobile driving and a better highway system. Reconciling the conflict between the positive effects of driving and our state’s anti-driving policies will be one of the central challenges for decision-makers in the near future.”
Does driving contribute to the GDP? Sure it does. But it’s important to understand what the GDP is. It’s a measure that includes all goods and services produced by the economy – without regard to whether they’re positive or negative, beneficial or harmful. Building a new prison adds to the GDP just the same as building a new high school.
The cost of buying, maintaining and repairing cars goes into the GDP. The cost of gasoline goes into the GDP. The cost of building and repairing highways goes into the GDP. The cost of paying police to patrol those highways goes into the GDP. The cost of medical care for those injured on those highways goes into the GDP. The cost of paying paramedics to pick up the bloody remains of those who are less lucky goes into the GDP.
So, yes, as driving increases, GDP increases. But not all of that increase is a good thing. And if people switch from cars to other modes of transportation, that will contribute to the GDP too. It will cost money – a lot of it – to build, operate and maintain the rail lines and bus lines they use.
It’s not hard to imagine Randall Podenza’s counterpart in the 1880s doing a study proving that increased use of horses contributed positively to GDP growth, and that the trend toward those newfangled “horseless carriages” was a menace to the national economy.
This article appears in Nov 5-11, 2009.
MAKE LOCAL JOURNALISM HAPPEN
Republish our articles for free, online or in print, under a Creative Commons license.
Altogether a nice exercise in obfuscation. Or something in the water. Make’s one wonder if, like the whitewater park, these folks have taken note of the fact that the “build it they will come” business model has failed, spectacularly. The bubble has burst, the boom is over…
For example: the college bond… while I'm all for improving the educational quality of the voters around here, the college campaigned on a promise of “Jobs Now, Jobs for the Future” and the only jobs last night's win will create right now is for those few involved in planning and preparation for construction of whatever it is they intend to start to build a year or so from now, which will from my experience with college construction provide very few, if any, jobs to local contractors. Low-bid contracts tend to bring their own employees with them… from Portland or where-ever. As to jobs for the future, if it takes two years to build it, and a minimum of two years to run a student through a program in the facility, then with the exception of the few actually employed within the facility it'll be a minimum of four years before anyone could point to the new construction as successfully providing jobs. Which is a questionable statement in and of itself.
I kinda’ wish the fluoride nuts are on to something, it’d be a lot easier to type out than “drinking the Ambein, Prosaic, Viagra and CNN/Faux News crotch-shots Kool-Aid again”.
If you want to create jobs and prosperity stop all aid to other nations until people here in the US are taken care of, stop buying products made elsewhere until trade is balanced.
D.S., foreign aid is such a miniscule part of the budget its pathetic. Hell, more money is lost to Medicare fraud each year then what we spend on foreign aid.
Right now only about 3% of all the clothing you buy is produced in the US. 30% of our food supply is imported, and going higher as the left wing loonies shut down more farming as they have done in SW California, the Klamath Basin, and other places. Repair parts for our military equipment is manufactured overseas, and when was the last time you bought a part for your car that was manufactured in the US, or even bought a car where all of the parts are manufactured here? Then there is the needed supply of lumber products. Hard to find lumber manufactured in the US thanks to you know who. Then you have the energy “crisis”. Matters not that we could supply ourselves for 300 years if some people would allow drilling for oil, natural gas, the use of clean coal technology, nuclear power, geothermal power, biomass generators, etc. How about the steel market?
Nothing that the current crop of legislators, State or federal, is doing will ever improve the economic conditions here in this country, only in foreign countries.
BTW, the GDP is based on three factors: consumer spending, investment, and government spending. Consumer spending is down, investment is down, and only government spending is up.
Thomas: The problem with “retraining” as a solution to unemployment is that we’re training people for jobs that aren’t there — or aren’t there in sufficient numbers to absorb all the people being retrained for them. The NYTimes had a story about this a couple of months ago.
“as the left wing loonies shut down more farming as they have done in SW California, the Klamath Basin, and other places.”
How the hell are they doing that??? I haven’t been to SW California in quite a while, but I was in the Klamath Basin a couple of years ago working on a story and the farms seemed to be in a very flourishing state (thanks to that “socialistic” government irrigation project).
In 2001 the U.S. Bureau of Reclamation shut off irrigation water to 1,400 farmers, and 210,000 acres of land in the Klamath River Basin. Today the envirowhackos are attempting to remove the Klamath River dam which would essentially end farming in the basin.
“The decision was triggered by Endangered Species Act (ESA) requirements imposed by the U.S. Fish and Wildlife Service (for two species of Klamath Lake suckerfish) and the National Marine Fisheries Service (for Klamath River coho salmon). Underlying factors were several lawsuits (and threats of more) by a consortium of national and local environmental groups.”
Here is a website you should read in regards to what is happening in SW California, and Oregon.
http://www.klamathbasincrisis.org/agriculture/articles/09/farmerslosing051809.htm
http://www.klamathbasincrisis.org/index.html
They shut off water to farmers in the Fresno area. Its becoming a desert. All to save a 2″ long fish. Stupid.
The 2001 shutdown was temporary, caused by extreme drought conditions.
“Today the envirowhackos are attempting to remove the Klamath River dam which would essentially end farming in the basin.”
Absolute nonsense.
There are a number of dams on the Klamath, not just one. The ones that will eventually be removed are antiquated structures that contribute little or nothing to irrigation supplies anymore. The agreement to remove them came after lengthy and complicated negotiations involving state and federal agencies, the Klamath Basin farmers, area Indian tribes, conservation groups and others. (The farmers had no real problem with removing the dams, but wanted a guarantee that they’d continue to have cheap electric power to run their pumps.)
Several years ago I wrote a four-part series on the Klamath water issue for the Source, spending two days in the Basin and interviewing dozens of people, so I think I have a more thorough understanding of the situation there than can be attained by looking at one website. You’re in over your head on this one.
Miller,
I would have thought by now that you would have learned that if I decide to take on a subject I am never “in over my head”, and never rely on just one website, or one opinion. However, it is just as true that you never bothered to read the information I posted.
Recently it was proposed by the Obama administration, under the “cap and trade” ideology, to remove over 100 million acres from agriculture production, and pay farmers to grow trees. Since the time of FDR, and his farm aid programs, about 2/3’s of the family farms have been lost, and corporate farms have grown. In the Klamath Basin one of the fish that was “threatened” was the Coho Salmon, and under this excuse thousands of acres of land were taken out of production. Yet in the same year, and ever since, the Coho has had record runs in the Columbia. In SW California the excuse for denying water to the farmers is the Delta Smelt. This is a fish that has been proven to survive under severe drought conditions, yet farmers are being put out of business, and 60,000 to 90,000 jobs have been lost, to “save” this fish. Another proposal put forth by the Obama administration has to do with extended federal control over what are called “wetlands”, and taking even more farm land out of production.
Now, while you may have talked to “dozens of people”, just how many of those were farmers, or ranchers, and how many were the same “environmentalists” that filed the false information, and dried up the farms?
BTW, there are 4 dams that are being considered for removal, and none are “antiquated”. And the largest of the Indian tribes have not agreed to the plan.
http://www.klamathbasincrisis.org/
“I would have thought by now that you would have learned that if I decide to take on a subject I am never “in over my head””
I have definitely learned that you will never admit being wrong about anything — a typical pig-headed right-winger.
“Recently it was proposed by the Obama administration, under the “cap and trade” ideology, to remove over 100 million acres from agriculture production, and pay farmers to grow trees. Since the time of FDR, and his farm aid programs, about 2/3’s of the family farms have been lost, and corporate farms have grown.”
What the hell does any of this have to do with the Klamath Basin?
“Now, while you may have talked to “dozens of people”, just how many of those were farmers, or ranchers”
About half of them.
Good-bye, Swipies.
H. Bruce Miller says:
“I have definitely learned that you will never admit being wrong about anything — a typical pig-headed right-winger.”
Unlike you I admit when I am wrong if the facts support such a conclusion. So far you have given no facts that support your conclusions, and, like the typical left wing loonie, you have chosen to ignore the facts I have presented.
“What the hell does any of this have to do with the Klamath Basin?”
It has to do with the destruction of agriculture in general in the US. This in turn destroys jobs, and makes us more dependent on foreign trade. One of the arguments in the Klamath Basin is the renewal of wetlands which have been used for farming for decades. Under the current proposals much of the land used currently for farms, and for cattle ranching, will be eliminated.
Currently we are importing 30% of our food while millions of acres of farmland in the US lies idle. Worldwide, for those who are worried about the “population explosion”, there are approximately 2.6 to 3 billion acres of farmland lying idle. A lot of this is in Africa where farms that were once run by Whites have been taken by the government, and given to Blacks who know nothing about farming.
“About half of them.”
What did you do, have a town hall meeting? First off, I doubt if you spoke to “dozens of people” in just two days. Next, knowing what kind of “research” you were probably looking for, I doubt if half of them were farmers.
Did you speak to anyone who admitted that the shutoff in 2001 over the sucker fish, and the coho, was a farce? And where was the “extreme drought” at save for the caused by the shut off by the gov’t?
Good bye Miller.
I have aired concern, Bruce, here and elsewhere, in these past few months since the deteriorating economic climate became clear to more than just this somewhat smug Cassandra, that the college, our paper of record and, to a lessor extent, this tome are not doing the unemployed any favors hyping back-to-school as the end all unemployment solution.
To reiterate, I'm all for improving the educational quality of the voters around here (witness your trolls), but this notion that on the other side of it is a better paying job, or for that matter the college is creating jobs, is an obfuscation. Credit where credit is due: the new building will generate a few short-term construction jobs and perhaps a few new support positions within the expanded facility, but in the long-term the college is not “Creating Jobs”, it is creating highly trained and hopefully well educated Job Candidates. And four years out at that.
There’s a bit of a conspiracy angle to this as well: I don’t count, I just delete, but I probably get five or six emails on my spam account a day advertising some kind of “financial aid”, and though my television viewing is limited to rare occasions at The Pub, I’ve seen a number of advertisements from perky little co-eds to rapper dudes and Latino single moms implying borrowing money to meet All the expenses, including “living” expenses. Brought to you by the very same slicers and dicers of mortgage based security derivatives that hand delivered us the greatest housing bust in our history (I’ve been through, now, five of ’em): student loans are the new sub-prime racket.
I’m not in any way suggesting nefarious intent upon the college. Indeed, with a wife, son, daughter-in-law, son-in-law and step-daughter enrolled it’s in my best interest to refrain from criticism. Never-the-less, this notion pumping through a year certification is going to improve the employment situation in June ’10, or a two or three year program is going to improve the employment outlook in ’11 or even ’12 does the unemployed student no favors. All-the-moreso if in desperation to improve their quality of life and just get by in doing so they are being preyed upon by Boris the Banker.