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Archive for October, 2009

Marketing 101

I must, again, be missing something here.

In a New Castle County high school things are well, unsettled. So unsettled that parents are looking for alternatives. Meeting after meeting with district brass have produced no results.

Furthermore, the parents have been told basically, “get over it’. The parents want discipline and in particular want 4 unruly students put out.

The district admits privately – how I found out – that the kids need to be tossed but fear of a lawsuit prevents such action.

Each kid brings in about 9 large a year.

So they’ll keep 4 kids for 36,000 and risk losing 9 kids who will not be returning next year for a loss of 81,000 a year. Do the math.

Now the district won’t market the school for the 9 but will for the 4.

The 9 are appplying to charter schools.

Oh, a school board member rants and rails against charter schools.

Why, because according to him, “they take our kids”.

Really? I feel that with all of this Race To The Top federal money DE is clamoring for perhaps a marketing course for administration should be required.

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Early last week, the Governor along with Senators Carper & Kaufman held a press conference to “celebrate” the fact that over $1 billion in Federal “stimulus” money (aka taxpayer money taken by the Feds for the purposes of redistribution in a more fair and equitable fashion) was or would soon be spent in Delaware. Later in the week, the Lt. Governor announced with great fanfare that between 1,055 and 3,605 jobs had been “created or saved” in Delaware and some other jobs had “probably” been “created or saved” as a result of the tax cuts portion of the “stimulus”. (Once again, Democrats are admitting that tax cuts create job growth).

So, let’s double the Lt. Governor’s estimates and assume that between 2,100 and 7,200 jobs have been “created or saved” due to the federal “stimulus”. That means that the federal government has spent between $138,888  and $476,190 per job “created or saved” — an average of about $308,000 per job.

Compare this to the private sector. A company creates a job as a result of value that it has created in the market place. There is no cost to the taxpayer (as a matter of fact there is a huge benefit to the taxpayer in the sharing of that wealth). That is the key difference — Government cannot create wealth, it can only create money (which is why it costs them $308,000 to “create or save” a job). Businesses create wealth which is then reflected in the money that they have earned.

Earning wealth versus printing money. The sooner that progressives understand this very simple concept, the sooner unemployment goes back to 3%.

Late addendum 4:48pm 10-31-2009 — According to ABC, nationwide the “stimulus” has spent $160,000 per job”. The article can be found here. The White House is evidently not amused, and neither am I. Delaware is, once again, underperforming the rest of the nation in our “stimulus” efforts.

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After an exhaustive review of the state budget there could be no more cuts to be found last year and the state employees had to absorb a 2.5% pay cut in order to continue essential state services.
Today I discovered one of those essential state services. A $240,000 grant to a private retirement home for a solar electricity system! The total cost for the project was nearly a Million Dollars. The state (being flush with the state employees money) paid 25%, the feds borrowed 30% ($290,000) from the Chinese to fund it and the nursing home paid the rest.
Hooray! They will save $19,000 per year, so given the $435,000 that they paid, they will begin saving money in 23 years which is just about 7 years before they will likely need to be replaced.
I doubt that the state employees had just such a critical expense in mind when they agreed.

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Did the NJ really say there will be no job growth in our little state until 2015?

2015?

Please tell me my edition had a bad press run.

Gov’t can’t grow anymore and taxes will be raised.

We’ve bottomed out.

 

 

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I received the letter found below from State House Minority Leader Dick Cathcart and House Minority Whip Danny Short. The press release comments on a closed-door meeting recently held by the Governor with only Democratic Lawmakers discussing the newly-minted budget crisis facing the State (another $400 million shortfall? Already? Who’s doing the forecasting, anyway?)

Sadly, this letter speaks to a level of partisanship that I didn’t expect. I have heard from a Newark-area friend of mine that there was a community meeting in Newark on October 8th. The only elected officials invited were… Democrats. Since Senator Liane Sorenson (R-Newark) represents more of Newark than anyone else, my friend was a bit surprised that the Governor and local legislators would be so blatantly partisan — especially in Delaware. A sign of the “post-partisan times”, I suppose.

While I frequently criticize the failure of the “Delaware Way” in Dover (because it represents the worst of “group think” and has led directly to our problems), being partisan will be unsuccessful IMVHO.

Minority Leader Cathcart & Minority Whip Short’s letter:

House Leaders to Governor:

Embrace Transparency and Cooperation in Shaping New Budget

By State House Minority Leader Richard Cathcart & State House Minority Whip Dan Short

Just a few months ago, our state closed what was arguably the most difficult budget cycle in state history, bridging a financial gap measured in the hundreds-of-millions-of-dollars and enacting a balanced budget.

That enormous task was accomplished with bipartisan cooperation and, more importantly, under the watchful eye of the press and the public.

It makes it all the more disappointing that Gov. Jack Markell has turned his back on this success and begun the Fiscal Year 2011 budget process by holding a secret, closed-door meeting with a small cadre of Democratic legislative leaders to discuss the new financial challenges facing our state.

Speaking in a recent published report about the clandestine meeting, Sen. Robert Venables said the state could again face a huge breach in the budget that begins July 1st: “The figure we got is a $337 million gap – right now – that we got to close.”

Just as was the case that led to the current budget (FY 2010), what we do to close this gap will impact every Delawarean.  Mending the FY 2010 budget hole – estimated at nearly $800 million – meant eliminating hundreds of open state jobs, cutting the compensation of state workers, and enacting a package of tax and fee increases topping $212 million!  No one was left unscathed.

We all have a stake in the budget process, but the governor has chosen to invite only a select few into the process thus far.  According to published comments from Sen. Venables, who is chairman of the Bond Bill Committee, House Majority Leader Pete Schwartzkopf and Speaker of the House Bob Gilligan met in the governor’s office on October 20th with Office of Management and Budget Director Ann Visalli for a private briefing.

Just 10 months ago, the governor promised a different approach.  Delivering his inaugural address, the governor stated:  “I pledge that my administration will be more transparent and accountable than any that have come before.”

Holding secret, partisan budget meetings are not only contrary to this goal, it creates mistrust that is difficult to overcome.  No doubt the people involved will say these are only preliminary meetings, held to iron out details before they’re disclosed to everyone later.  In fact, in commenting on the recent meeting, the governor’s spokesman, Joe Rogalsky, said that in time everyone would be briefed.

But meeting behind closed doors, even if done innocently, sends the wrong message to a public that has good reason to question the operation of state government.

Earlier this year, Speaker of the House Bob Gilligan sponsored a new law to make the General Assembly subject to the state’s Freedom of Information Act.  One of the most important implications of this landmark legislation was to open the meetings of the legislature’s budget-writing Joint Finance Committee and Bond Bill Committee.  It’s ironic that the people that most touted this worthy legislation took part in the recent secret budget meeting.

We do not believe Speaker Gilligan, Gov. Markell or House Majority Leader Schwartzkopf intended any malice when they held their meeting.  Unfortunately, when you conduct these types of gatherings it’s hard to shake the perception that the real decisions are being made behind closed doors and that the information that’s later shared with the public is carefully crafted to justify those predetermined choices.

There’s a simple solution to this and it’s in keeping with the governor’s stated objectives for transparency – hold all budgetary meetings involving executive branch and legislative leaders openly.  The meetings can be posted in advance and streamed live on the Internet.  If this proves too cumbersome, they can be recorded and posted to a dedicated page on the state’s website within 24 hours.  The second option, while less desirable, could be implemented immediately and would give the public a chance to track the process and have a record of how it progresses.

Additionally, as we work on the next budget, partisanship needs to take a back seat to openness and consensus.  Republicans need to be made complete partners in the process.  Not only do Republican state legislators represent more than 40-percent of all Delawareans, we also played a key role in shaping and enacting our current balanced budget.

We urge the governor to conduct future budgetary meetings in the open, bringing all legislative leaders, regardless of party affiliation, together in a cooperative effort to address our shared challenges.

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Let me start by repeating that I think that bringing Fiskers to Delaware was well-done by Governor Markell and DEDO Director Alan Levin. Having a Vice-President from Delaware probably didn’t hurt, but the Governor deserves congratulation.

However…

Next year, Americans of all economic levels will be facing tax increases to pay for the gigantic and growing deficits developing in Washington and Dover. We’re told repeatedly by the Left that tax increases are necessary to grow the economy, and that tax cuts do not spur economic growth or development. I remember quite well last spring the Governor saying that “we [the government] cannot cut our way to prosperity.” So, small businesses and individuals in the State got thwacked with tax increases last year (which obviously led to cuts in employment and investment) — with more tax increases on the horizon for 2010.

So, I was amused to learn the taxpayer benefits bestowed upon Fiskers:

The state has offered Fisker a $9 million grant to offset utility costs at the plant. Plus a $12 million dollar 0% interest loan.

New Castle County has been asked to a property tax abatement at the site for 5 years totaling $275,198.94 per year.

About $169 million of the Energy Department loan was designated for engineering work for the Karma, which will be made in Finland by contract manufacturer Valmet Automotive and sell at a starting price of $87,900. The company expects to begin selling the Karma in June. Koehler said Tuesday that production of the next version of the Karma will shift to Boxwood Road in 2016, after the end of the first production run in Finland. (Good to know that my tax dollars will help Finland!!) The Nina will begin production at the Boxwood plant in 2012.

Fisker expects the Nina to retail for $39,900 after a $7,500 federal tax credit.

So, Democrats really need to refine their anti-low-tax lingo to a more Orwellian — “All tax cuts are bad, except for the ones that we define as good.”

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Yesterday, Senators Carper and Kaufman organized a press conference with Governor Markell to announce that Delaware has received or will receive $1 billion in stimulus money (The article can be found here). I suppose that they needed this press conference because the Fiskers announcement today wouldn’t garner enough press (that’s a joke, btw). I suspect that they held it just to generate some cheering from the crowd. That’s cheering with a ‘ch’ not jeering with a ‘j’.

I find the timing of the non-news press conference odd because of an article in the Cape Gazette that came out a couple of days earlier that stated (The whole article can be found here):

…for the budget that begins July 1, 2010, the state is not expecting to receive the one-time-only $200 million in federal stimulus funds that helped to balance the current budget. [emphasis added]

So, we’re holding a press conference to cheer $1 billion that we have or are expected to receive while at the same time Democratic lawmakers are being told behind closed doors that we’re not receiving enough to fix our impending budget crisis.

That is a confusing message. Which is it? Over a billion dollars or not enough? Or are they the same? Is over $1 billion in bonus money not enough for the Democratic leadership of the State?

Anyway, I think that it is important to note that no press conference was held by the 12,800 Delawareans who have lost their jobs over the last year.

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