OT: speaking of California's finances, saw this interesting piece about "Ohio's Miracle" -- published by CityBeat today:
Governor’s “Ohio Miracle” Falling Far Short of Promises
Ohio was one of two states to see economy worsen in three-month index
Despite Gov. John Kasich’s claims to the contrary, the only miracle in Ohio’s economy might be how bad the state is doing compared to the rest of the nation.
The proof: Ohio’s economy was among just two states in the nation that actually worsened during September through November compared to August through October, according to the research department at the Federal Reserve Bank of Philadelphia.
Beyond Ohio’s borders, Alaska also worsened, two states remained stable and the rest of the nation moved in a generally positive direction.
In other words, while 46 states’ economies moved in a generally positive direction, Ohio actually got worse.
The measures come from the State Coincident Index issued by the Federal Reserve Bank of Philadelphia every month. The index combines several economic indicators to gauge the condition of each state’s economy. The research department then gauges whether the index improved or worsened after the latest month’s data is taken into account.
With the gubernatorial election now less than one year away, the sorry state of Ohio’s economy could prove a bad sign for Gov. Kasich’s re-election.
Kasich, a Republican, came into office as Ohio’s economy began dashing out of the Great Recession stronger than most of the nation — a trend Kasich took to calling the “Ohio miracle.”
Ed FitzGerald, Kasich’s likely Democratic challenger, has criticized the claim in the past few months as Ohio’s economy showed more signs of worsening despite Kasich’s promises that his policies would keep the state in the right direction.
One of those policies was privatizing Ohio’s development agency and effectively turning it into JobsOhio. In less than three years, the agency has been riddled in multiple scandals following accusations from Democrats that the JobsOhio board hosts various conflicts of interests and lacks transparency when recommending who should get state tax credits.
Kasich also pushed and approved an across-the-board income tax cut earlier in 2013 through the two-year state budget. But because the income tax cut came with a sales tax hike, left-leaning think tank Policy Matters Ohio found Kasich’s tax cut heavily favors the wealthy, which calls into question whether the tax cut will actually help Ohio’s middle class or economy.
Then there’s the question of whether state policies matter much, if at all. Economists generally agree that state officials tend to dramatize the economic impact of their policies when much bigger factors are at play, particularly as globalization reshapes the national and global economies.
For now, one thing is clear: Kasich’s policies haven’t been enough to turn around Ohio’s sinking economy throughout the past three months.
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