This summer the U.S. Supreme Court will decide what authority if any states have to determine immigration policies within their borders. This year the Georgia agriculture industry hopes to avoid a repeat of last year’s fiasco when just the possibility of a new state law caused seasonal workers to leave or avoid the state; an estimated $400 million in crops rotted in the fields.
Wednesday morning the Supreme Court heard arguments in the Obama administration effort to stop Arizona’s immigration law. Arizona says the federal government has failed to stop the migration of illegal immigrants from Mexico. The Obama administration says states have no legal authority to control any aspect of immigration law.
This is the reality of it: Eight U.S. Supreme Court justices and three judges on the 11th Circuit Court of Appeals in Atlanta could determine whether Georgia has enough migratory labor force to pick and pack fruits and vegetables worth billions of dollars. Right now it is a chess game because the nation does not have a migratory guest worker program that actually works well.
“Cautious is the right word,” said Georgia Fruit and Vegetable Growers Association Executive Director Charles Hall. “We are pretty confident we will be okay, but if the Supreme Court ruling basically allowed the Circuit Court to rule that the Georgia law is constitutional and they can enforce the show me your papers section, we’ll have the same fiasco we had last year.”
“Show me your papers” is a section of Georgia’s 2011 immigration law that would allow local law enforcement to detain anyone who is not carrying proof that they are in the country legally. The bill had not even become a law last spring when migrant workers began to bail on Georgia.
“A lot of workers went to North Carolina,” said Georgia Agribusiness Council President Bryan Tolar. “That happened. They didn’t flee the country. They fled to other states where they didn’t feel those pressures existed.” Using industry provided data, the University of Georgia said 11,000 agriculture jobs usually done by seasonal migrant workers went unfilled last year.
Two sections of last year’s Georgia law – including “show me your papers” – are on hold after a challenge filed by several plaintiff organizations. A federal judge stayed those sections pending review. The three-judge 11th Circuit Court of Appeals in Atlanta heard arguments on March 1. No ruling is expected until after the U.S. Supreme Court decides the Arizona case.
Here is why all this matters. Crops don’t wait for courts to make up their minds. A mild winter means some Georgia crops will be ready to harvest weeks ahead of most years. Berries are coming out of the fields now. Onions are underway and other crops within the next few weeks.
Migrant labor sustains domestic agriculture. The work Americans will not do to harvest their own food is done by seasonal workers who are willing to earn $9.39 per hour – and sometimes a bit more if they work fast – to pick and pack crops. How do we think berries get into grocery store boxes? Someone picks and packs them. That person is usually a migrant worker.
But millions of illegal migrants – a high percentage from Mexico – have overwhelmed social services, particularly state Medicaid budgets. States continuously plead with Washington for better federal control of the U.S. border with Mexico. Arizona passed its version of immigration law in April 2010. Georgia, Alabama, Indiana, South Carolina and Utah also passed laws.
On one hand you have the agriculture industry in desperate need of seasonal migrant workers. On the other hand you have states trying to control their borders and social services costs. Those ideas don’t mix well and Congress has failed to enact guest worker program relief.
About 33 Georgia producers rely on H2A – the existing federal program to provide legal migrant workers. But industry insiders say the program is flawed, applications are often delayed or lost and they cannot rely on it. “We had guys with onions laying on the top of the ground because (workers) did not arrive on time” this year, said Georgia Department of Agriculture commissioner Gary Black.
Last year – faced with rotting crops – Georgia tried to innovate. Probationers were offered the chance to work alongside migrants in blistering hot fields. Not surprisingly, fewer than a couple dozen even tried to participate and the heralded initiative fizzled under the blazing sun.
Georgia agriculture is a $68.9 billion per year industry that needs to fill 80,000 seasonal jobs. It doesn’t need them all at once. It needs some in the spring; it needs others through the summer and into fall. Geographically, the primary need is in the southern portion of the state.
No one can predict what a court will do, but there is some logic to how this might play out. If the U.S. Supreme Court upholds the Arizona law, the 11th Circuit Court in Atlanta could decide that Georgia can begin to enforce the so-called “show me your papers” law. If the Supreme Court overturns the Arizona law then all immigration issues will likely be in the hands of Congress.
The final word here comes from Bryan Tolar at the Georgia Agribusiness Council: “Where do we go from here? We have a state that is concerned about providing services to people who are in the country illegally. We have our largest economic engine that relies on labor and we can’t find the people domestically. If you can’t fill the need, what do you do?”
(Mike Klein is Editor at the Georgia Public Policy Foundation)
Magic Johnson’s parents never earned high school diplomas. However, they made it clear to four sons and six daughters that failure to graduate from high school was not an option. “They were on top of us every day,” Johnson said in Atlanta. Today five of his six sisters are Michigan public school teachers and the sixth is an elementary school principal. “I am looking at all these educators in my family after my mom and my dad finished seventh or eighth grade.”
Magic Johnson is one of the most recognizable people in the world. Famous initially for his ability to do things with a basketball that mere ticketholders could only imagine. Famous now because in life after basketball Johnson has created businesses that employ thousands of mostly inner city people, led campaigns for AIDS research and he has invested time, money and two decades into the idea young people can be given the tools and inspiration to graduate from high school, pursue more learning and become successful adults.
Oh, yes, Johnson recently became part-owner of the Los Angeles Dodgers. But it was books not baseball or basketball that brought Johnson to Atlanta this week. Johnson said his new program — Bridgescape Learning Centers, focused on dropout prevention and recovery – will become a resource at Provost Academy Georgia, the state’s newest online high school. Provost’s parent is Edison Learning, a New York-based digital learning company that has schools nationwide. Provost is expected to open this fall.
Bridgescape will focus on young men and women who have quit or are at-risk to quit school. It will provide a path to a high school diploma through a state-approved online high school. Bridgescape will be unique from other good programs that offer GEDs – general equivalency diplomas — that are not real high school diplomas. The Provost Academy – Bridgescape model is blended learning – digital combined with individual, face-to-face instruction, computers, internet access and personalized lesson plans.
The Magic Johnson Enterprise partnership with Edison Learning was announced last fall. Bridgescape Learning Centers have already opened in several Ohio cities. Provost Academy Georgia is an expansion. There could be as many as seven statewide learning centers but their locations are a work in progress.
Provost Academy Georgia was scheduled to open last fall as Georgia’s first fully accredited online high school. However, it got caught in the state charter schools commission controversy so the opening was delayed. Provost will announce when it is ready to accept student applications for next fall.
Magic Johnson’s financial worth is estimated at $500 million. He could be doing other things with his time and money but this is what Johnson does by choice. For 20 years the Magic Johnson Foundation has proposed and funded possible solutions to challenges faced by America’s urban communities.
Education is a big part of that focus. Nationally one-in-three students – many in urban communities — will quit high school. Some 1.2 million students drop out every year, 7,000 leave school every day, one quits every 26 seconds. Inner city minority youth are a big part of that drop out picture.
“A huge number of African American kids are dropping out,” Johnson said. “I want to make sure we bring them back into our program. We know that, unfortunately, if you don’t have a high school diploma normally our kids turn to crime. We’ve got to quit losing kids to the jail system.”
State school superintendent John Barge not only attended Johnson’s news conference, he was an enthusiastic participant. “When we start talking about recovering the dropouts, this is probably one of the few opportunities children have to come back and earn a high school diploma,” Barge said. It is not lost here that Barge enthusiastically encouraged an idea that is operating outside the usual state path.
Georgia recently announced that last year it had a 67% on-time high school graduation rate. “That means over the last several years we have hundreds of thousands of people without a high school diploma,” Barge said. “We know without a high school diploma there is no hope for these children.”
Earvin Johnson Sr. and his wife Christine moved from Mississippi to Michigan because there were jobs in the auto plants that did not require a high school education. “Today that’s not the case,’ said their famous son. “Today you have to have a diploma to get a job at those same plants.” Johnson had nine brothers and sisters. His mother worked as a custodian. His father had a shift at General Motors.
Magic Johnson was an absolute basketball prodigy in Lansing, Michigan. It was obvious to anyone who watched that there was something special about the 6-foot-9 young man who saw the basketball court as a canvas. His job was to make things happen on the canvas that folks had not seen before. From Michigan State to the NBA to life after basketball, Johnson continues to make things happen.
The Magic Johnson Foundation has funded 18 urban community technology centers, including one in Atlanta. It has funded hundreds of college scholarships, including help for students who attend several Georgia public universities, along with Morehouse and Spelman. The Foundation has donated millions of dollars to online learning programs, and the hardware and software projects required to support learning.
“My whole life and the mission of the Magic Johnson Foundation has been urban America,” Johnson said. “I came up through the neighborhood. You’ve got somebody who knows, who understands. I’m not going to let the kids have excuses. All of us have come together because we have one common goal, how do we graduate these young people who have dropped out, who maybe learn in a different way? How do we make it better for young people? They must graduate from high school.”
This is what Magic Johnson does, simply because he can and someone should.
(Mike Klein is Editor at the Georgia Public Policy Foundation)
When Advanced Catheter Therapies announced a new technology patent in January the dateline was Chattanooga. The press release noted, “The Company recently announced a name change from Atlanta Catheter Therapies.” No longer located in Georgia, Advanced Catheter raised almost $3 million from Tennessee-based investors after it became frustrated with Georgia’s inadequate venture capital opportunities. One of the investment requirements was relocation to Tennessee.
“Everybody I talked to in Tennessee, it was like, how can I help you?” said ACT founder Paul Fitzpatrick who commutes to Chattanooga from his home in Atlanta’s northern suburbs. He recalled conversation after conversation that went something like, “What doors can I open to help you succeed?”
Advanced Catheter is one among many examples that illustrate Georgia is pretty darn good at creating attractive companies, but it has some real problems holding onto them at certain venture capital stages. Governor Nathan Deal admitted as much when he spoke to an Atlanta Press Club audience this week, saying, “We know that one of the things that we are lacking is venture capital for start-up companies.”
The General Assembly passed no venture capital legislation this year, although it did consider two bills. “One of the reasons that we are losing start-up companies is they are able to be siphoned off by Boston and they’re able to be siphoned off by the Silicon Valley,” Deal said. “Having that capital available is important. We are going to continue to work on it.”
The closest that Georgia came to venture capital legislation is a pension reform bill the Governor signed Monday. This law will allow the Employee Retirement System to invest up to 5% (about $750 million) of its total assets (about $14.9 billion) in venture capital and other investments specifically named in the bill. No more than 1% (about $150 million) could be invested in each of five consecutive years.
The legislation is so specific that it cannot be interpreted to make investments funds available to entrepreneurs trying to create the next big idea in Georgia. For instance, something as big as Internet Security Systems – better known as ISS – that was incubated here by Chris Klaus and Tom Noonan.
ISS is among Georgia’s best technology success stories, not quite ranking up there with Ted Turner’s invention of CNN and other enormous technology platforms at Turner Broadcasting, but similar to the creation of internet service provider MindSpring by Charles Brewer back in 1994.
Klaus was a Georgia Tech undergrad in 1993 when he became intrigued by the development of software to help businesses defend themselves against computer hackers. Fast forward a few years and you find Klaus, then in partnership with Noonan, out on the stump looking for Georgia venture capital investors to grow their business. There simply weren’t any in Georgia with the resources that ISS needed.
Eventually, Klaus and Noonan secured millions of dollars in venture capital investment from two Boston firms that allowed ISS to remain in Atlanta. ISS eventually employed more than 1,650. Six years ago ISS was sold to IBM for about $1.3 billion. Klaus and Noonan are Georgia entrepreneurial icons and home grown innovators who’ve moved onto other ventures.
ISS was able to stay and build its brand in Atlanta. Regrettably, that is often not the case.
SolidFire left Atlanta for Boulder, Colorado, when the innovator of solid-state storage systems for cloud service providers secured $11 million in Colorado-based venture capital funds. NightRaft moved to Austin, Texas, where the company is staking out a position in live entertainment event smart phone apps marketing which NightRaft says is a $1 billion per year industry.
It’s not just new businesses. Georgia has also lost established, highly successful businesses.
A University of Georgia scientist founded AviGenics in 1996 after he developed a protein production technology. Twelve years later AviGenics was rebadged Synageva Corp. when it closed $17 million in Massachusetts venture capital financing. Today it focuses on rare diseases. Some parts of Synageva remained in Georgia but major components of the company moved to Boston.
This year – and this week — we’ve seen announcements that thousands of new Georgia jobs will be created by major corporate expansions and relocations. Thursday morning Governor Deal said Illinois-based pharmaceutical researcher Baxter International will bring 1,500 jobs to a new $1 billion facility near Social Circle about 40 miles east of Atlanta. Baxter joins Caterpillar, Carter’s and Toyota who have announced similar decisions to expand in Georgia.
Georgia has demonstrated it can attract corporations. But will it create the same sense of urgency around assistance to state-based entrepreneurs? Venture capital is a first tier priority. Georgia must foster supportive innovation so that our entrepreneurs keep 21st Century keep jobs here. Or, we can just continue to watch them leave Georgia for other states.
(Mike Klein is Editor at the Georgia Public Policy Foundation)
(This article was published in the Sunday April 15 Atlanta Journal-Constitution)
This year, Georgia legislators took down some barriers in tax, pension and criminal justice reform but they whiffed on creating a state-assisted venture capital investments model. Next January, they need to take another step forward in tax reform, monitor the start of criminal justice reforms, enact juvenile code reforms and create a real strategy around venture capital investments.
Tax reform this year included sales tax changes to benefit industry, the beginning of the end for the hated annual tax paid on personal vehicles, sales tax added to some online purchases and a gimmicky sales tax holiday. That is not enough. Comprehensive tax reform must include a decision — or at least a full blown discussion — about whether to revise the state’s 6 percent maximum income tax rate, which is widely considered to be non-competitive against states like Florida and Tennessee with no state income tax. Proponents of, say, a 3 percent to 4 percent maximum rate argue it will benefit Georgia’s emerging high-tech and bioscience industries.
One way to offset the change in income tax revenue would be to revise the state sales tax. That would require lots of buy-in over the next year. Income taxes fund about half the state budget. Local governments will be concerned about the impact of changes.
Two bills attempted to stimulate Georgia’s nascent venture capital investments industry. Both were controversial, highly political and neither passed the Legislature. Georgia continues to incubate businesses that move to other states when they need more venture capital. The Legislature must deal with this issue before more businesses and jobs lost.
Pension reform is another barrier that began to come down this year. The state Employees Retirement System is now authorized to invest up to 5 percent (about $750 million) of its available total assets (about $14.9 billion) in venture capital pools and other private placements specifically named in legislation. Georgia public sector pensions are well-funded in comparison to many states. However, public sector pensions nationally are under pressure as boomers begin to retire and state revenue is slow to recover from the recession. Eventually, the teachers’ retirement system should be included. Currently it is not, which is their choice.
Everyone agreed it is time to move forward with criminal justice reforms that will emphasize treatment over incarceration for some low-level property offenders and drug users. This is recognition that current strategies created swollen prison populations and caused havoc with budgets. Adult system reforms will take years to implement and it will be impossible to evaluate their success soon.
Georgia’s juvenile code, unchanged for decades, came up short this year. Gov. Nathan Deal’s office put on the brakes until there is a better understanding of the financial impact. There is universal support for changing this code that regulates foster care, permanent placement hearings, adoption codes, family mitigation hearings, status offenders and parental rights. This bill should become law next year if the financial analysis makes sense.
(Mike Klein is editor at the Georgia Public Policy Foundation.)
The Little White House in Warm Springs is a place where time stands still.
This was the Georgia home visited by Franklin Delano Roosevelt before and during his Presidency. It was far away from the stress and pain of world issues, somewhere that Roosevelt could find solace, therapy for polio that stole his strong legs and the companionship of friends. A stroke claimed the life of the longest-serving President in American history when Roosevelt died in his tiny four-poster bed on April 12, 1945 in Warm Springs.
On the world stage Roosevelt led his country out of depression and he led the free world against totalitarianism on two continents. But it was in Warm Springs that FDR and others founded the National Foundation for Infantile Paralysis. You likely know it as the March of Dimes. And it was here that FDR created a healing center for crippled children and adults. Today that center continues to operate as the Roosevelt Warm Springs Institute for Rehabilitation.
Each year the Little White House pauses to remember FDR on the anniversary of his death. Thursday morning’s ceremony marked the public launch of the Georgia Warrior Alliance initiative that could transform Warm Springs with a bold strategy to combine public and private resources to serve soldiers and their families. Camp Dream at Warm Springs hosted six groups of military families last year; some ninety families are here this weekend.
The physical results of war are painful and easy to see. It is more difficult to measure the depth of damage to a soldier’s soul and to his or her family. About 6,000 military veterans commit suicide each year. Divorce rates are 68% for soldiers who serve one overseas tour, 81% after two tours and 93% after three tours. There is a need to help. And there is a place in Warm Springs.
The Georgia Warrior Alliance project began about three years ago after a series of conversations that were started by Ross Mason and organized by the Georgia Public Policy Foundation and Senator Johnny Isakson. Mason, who founded HINRI – the Healthcare Institute for Neuro-Recovery and Innovation. was paralyzed in August, 2007 after a bicycle riding accident. Mason took his Warm Springs idea to dozens of Georgia military, business and philanthropic leaders. The conversation soon attracted others like Scott Rigsby and General Larry Ellis.
Rigsby is a Camilla. Georgia native whose story of courage is almost impossible to comprehend and he is perhaps the most remarkable athlete at any level that Georgia has ever known, bar none in any sport. “My name is Scott Rigsby and I’m an Ironman,” Rigsby said Thursday at the Little White House where he spoke on behalf of the Georgia Warrior Alliance.
Rigsby lost one leg after a motor vehicle accident when he was 18 years old. His other leg was removed several years later. Five years ago Rigsby became the first double amputee using prosthetic legs to complete the Ironman World Championship in Hawaii – 2.4 miles swimming, 112 miles cycling and 26.2 miles running. Warm Springs is where Rigsby learned to run after his second amputation.
Rigsby’s autobiography “UnThinkable” tells the story of his journey through tragedy, depression and recovery. “Helen Keller said it best; ‘It is a terrible thing to see and have no vision.’ I didn’t have any vision for my life. I wanted to die,” Rigsby said. “At Christmas 2005 I threw a Hail Mary prayer up to God and said, hey, Man, if you open a door for me then I’ll run through it. Be careful what you pray for. I’ve been doing a lot of running.”
Today Rigsby spends a lot of time with veterans and their families. He spoke about meeting the wife of a soldier who was sent to Walter Reed Army Hospital after his leg was blown off by a roadside bomb. “I looked at his wife; she had tears streaming down her face. She said to me, ‘Is my husband going to be alright?’ I am proud to say that I could look back at her and say, ‘Am I alright!’ With confidence I could share that feeling that they could still live an active lifestyle (and) that their sacrifice was not in vain.”
General Ellis spent 35 years in the military and he retired as Commander of the U.S. Army Forces Command. Today he serves on many boards including the University System of Georgia Board of Regents. Eight months ago Ellis began to feel numbness in his legs. The diagnosis was spinal injuries perhaps caused by dozens of military career parachute jumps. Ellis underwent two spinal cord surgeries but shortly thereafter a rare complication paralyzed him from the waist down.
“Following my second surgery, not knowing if I would ever walk again at the tender age of 65, I began to reflect on the negative consequences of being wheelchair-bound for the rest of my life,” Ellis said at the Little White House. “To say the least, it was one of the most depressing periods of my life. Given my experience I cannot imagine how devastated and confounded the young FDR was when he learned that he would never walk again.”
Ellis is walking again, sometimes aided by a cane, after care at St. Joseph’s Hospital in Atlanta. When he spoke at the Little White House the retired four-star general paused to mention five veterans seated upfront in their wheelchairs. Ellis said a Georgia Warrior Alliance survey of 4,000 Georgia military families concluded their number one need “was for a safe environment to decompress from the stresses of combat and re-engage with their families.” That, in a nutshell, is what the Warm Springs project is all about.
The Georgia Warrior Alliance goal would keep the civilian component but add a new military aspect. Callaway Gardens in nearby Pine Mountain has agreed to host families who have wounded warriors in treatment. The Alliance envisions coordination with the U.S. military burn center in Augusta. The project could boost state telemedicine initiatives. Georgia’s extensive university health care research capacity could become part of the Warm Springs initiative.
Mason has said there is already support for the Georgia Warrior Alliance idea among the U.S. Joint Chiefs of Staff. The project could draw down tens of millions of federal dollars to Georgia that are available for treatment of veterans. Georgia Tech is already working on an internet strategy. The Alliance wants to network some 360 Georgia agencies that offer support services to veterans and it would like to build a non-profits training hub for them at Warm Springs.
None of this is guaranteed to happen. What the Georgia Warrior Alliance seeks to achieve will require combining lots of sectors that sometimes have problems figuring out how to work together. It should help that Mason chairs the Department of Community Health board of directors.
There were a few hundred folks including an Iwo Jima veteran and lots of children sitting outside the Little White House on Thursday morning when Rigsby made his strongest case for the Georgia Warrior Alliance: “Georgia has the best facilities. We have the best corporations. We have the best health care. We have the best research institutions. We have the best people to set the standard for the nation. Let us be the generation that cares,” Rigsby said.
“Let us erase the bad memories of the wounded who were left behind in previous wars. One weekend with our wounded warriors and their families right here at Camp Dream is all you need to get you hooked. We can change the world right here today in this magical place of Warm Springs. We can do the unthinkable.”
Monday morning Scott Rigsby will do the “UnThinkable” again.
He will run the Boston Marathon.
(Mike Klein is Editor at the Georgia Public Policy Foundation)
Georgia built its economic strategy over the past couple decades around being a good place to raise a family with low taxes and a business friendly environment. But others are getting pretty good at using similar strategies and Georgia should feel none too comfortable with its tenth place national ranking in an economic strategies and performance report this week from the American Legislative Exchange Council.
“Georgia is still among the better states. Certainly you are not in the crisis category,” ALEC economist Jonathan Williams said during a telephone interview. “However, it does have some issues in terms of mediocrity.” Georgia’s 6% state personal income tax rate is about in the middle of all states, but it is positioned alongside Tennessee and Florida that do not collect income tax. “That does not help your marketing,” Williams said.
The fifth edition of “Rich States, Poor States” is a robust work co-authored by three conservative economists — Arthur Laffer who is often described as the father of supply side economics, Wall Street Journal editorial board economist Stephen Moore and Williams who directs the ALEC state fiscal reform and tax policy initiatives. The annual report compares state strategies in 15 tax, regulatory and labor law categories.
Southern states earned half of the top 16 spots with Virginia highest at third. There is a cluster of southern power at ten through 16 with Georgia, Arkansas, Tennessee, Florida, Oklahoma, Mississippi and Texas consecutively. Georgia ranked well in several soft categories but ALEC said the state is very much middle-of-pack in several high profile tax categories and Georgia has a ten-year trend in three important categories that you would not want to emphasize in a marketing plan.
The ALEC study released Wednesday placed Georgia first nationally (often tied with others) in categories like not imposing estate and inheritance taxes, requiring that employers pay only the lowest federal minimum wage of $7.25 per hour, being a right-to-work state and the amount of personal tax burden for each $1,000 of personal income.
Georgia ranked lower in total sales tax burden (36th), average workers’ compensation costs (27th), top personal income tax rate (25th), personal income tax progressivity (24th), total property tax burden (23rd), public employees per 10,000 population (21st), and top corporate income tax rate (15th). Tax law reforms passed by this year’s legislature that include the elimination of sales taxes paid on energy used in manufacturing and extending sales tax to more online purchases would not be considered until next year’s sixth edition of “Rich States, Poor States.“
“There are lots of things that affect states besides their own economic policies,” Laffer said during ALEC’s national conference call. “What happens to neighboring states, what happens to the U.S., oil prices and all sorts of other stuff happens. What we’re trying to look at here is how these state and local governments are doing and how they influence growth.”
The ALEC study includes a ten-year backward-looking measurement of domestic migration, non-farm payroll and personal income per capita. Isolating those three categories, ALEC ranked Georgia 33rd nationally during the decade that ended in 2010. Georgia ranked fifth nationally with strong population growth of 552,000 that earned the state one new congressional seat. But growth spiked in 2006 at some 120,000 new Georgians, then it quickly declined during the recession and there was almost no net growth during 2010.
The ten-year trend showed a 2.3% reduction in Georgia non-farm payroll employment; that placed the state 34th nationally. Texas non-farm payroll grew 11.5% during ten years, best in the south. Virginia grew 4.5%, Oklahoma 3.5%, Florida 2.9% and Arkansas 1.1%. North Carolina dropped nine-tenths of 1 percent followed by declines in Louisiana 1.3%, South Carolina 2.6%, Alabama 3.2%, Tennessee 3.8%, and Mississippi 5.4%.
Georgia personal income per capita grew 23% during the past decade and that was 48thnationally. Other southern states grew more; Louisiana by 58%, Arkansas 45.3%, Mississippi 45.1%, Oklahoma 44.4%, Virginia 39.4%, Alabama 39%, Texas 34%, Tennessee 32.2%, Florida 31.6%, South Carolina 30%, and North Carolina 25.7%.
Georgia non-farm payroll employment and personal income per capita numbers are frustrating because the state markets itself as a good place to grow intellectual equity companies in the high-tech, health and science sectors and to establish new manufacturing such as KIA in West Point and Caterpillar coming to the Athens area.
ALEC likes to highlight “Cheerful News from the States.” During Wednesday’s national conference call Laffer said bipartisan political leaders in his new home state of Tennessee have agreed to abolish estate and gift taxes. Nine states including Tennessee charge no state income tax. ALEC named Oklahoma, Kansas and Missouri among states that are studying how to abolish their personal income taxes. A 2010 state special council on tax reform recommended reducing the Georgia state income tax but the idea has not been able to move forward.
“Rich States, Poor States” also has its own Facebook page.
(Mike Klein is Editor at the Georgia Public Policy Foundation)
Georgia’s high school graduation rate could improve next year because the state will report the number of students who complete graduation requirements within five years instead of four years. Yes, you read that right, a five-year graduation rate.
“We know that not all students are the same and not all will graduate from high school in four years, so we asked for the U.S. Department of Education’s permission to use a five-year cohort graduation rate for federal accountability purposes,” state schools Superintendent John Barge said Tuesday. “Ultimately, our goal is to ensure each child will graduate from high school ready to succeed in college and a career, regardless of how long it takes.”
Barge is correct. Graduation is more important than how long it takes to get there. The state will also continue to track and be able to report a four-year graduation rate.
The five-year graduation rate announcement was sort of secondary Tuesday when state education officials revised the 2011 class graduation rate down to 67.4 percent from the previously announced 80 percent. The rate changed because the federal government standardized how all states must calculate graduation rates.
Four districts posted better than 90 percent graduation rates – Chickamauga City, Bremen City, Oconee County and Rabun County. Ten county or city public school systems were at 55 percent or less. That includes Atlanta Public Schools which graduated just 51.96 percent of its students on time, meaning within four years, which was the eighth worst school system performance statewide.
The new method will put all states on more even footing when analysts try to determine where learning is most and least successful. The previous model did not fully account for dropouts and school districts also had trouble tracking transfer students. That created the possibility that graduation results could be inflated.
The new model is considered more accurate, but education officials have warned for a couple years that it would produce a lower graduation rate. In effect, they worked in advance to reduce the shock and awe factor.
Georgia restated graduation rates for 2009, 2010 and 2011. That is smart strategy. It takes the emphasis off the 12.6 percent decline for the 2011 class and it enabled the state to demonstrate there is a trend line going up.
Using the old method, Georgia reported graduation rates of 78.9 percent, 80.8 percent and 80.9 percent in 2009 – 2011. Using the new method, the 2009 recalculation is a stark 58.6 percent but the rate improved to 64 percent in 2010 and 67.4 percent last year.
The report is packed with data; here is some that jumps out and begs to be noticed:
Districts Above 90 Percent: Chickamauga City 97.44, Bremen City 93.18, Oconee County 91.57, Rabun County 90.4.
Districts 80-to-90 Percent: Union County 88.69, Decatur City 88.40, Towns County 88.37, Wheeler County 87.5, White County 86.45, Forsyth County 86.27, Morgan County 86.09, Clinch County 85.53, Pike County 84.65, Pierce County 84.23, Commerce City 83.96, Hancock County 83.51, Miller County 83.33, Gilmer County 82.39, Fannin County 82.18, Stephens County 81.99, Screven County 81.94, Gordon County 81.76, Pickens County 80.74, Dalton City 80.57, Glascock County 80.0.
Atlanta Metro System Percentages: Forsyth County 86.27, Fayette County 78.23, Paulding County 76.0, Coweta County 74.85, Cherokee County 74.82, Cobb County 73.35, Henry County 72.35, Douglas County 70.98, Fulton County 70.05, Gwinnett County 67.56, Bartow County 66.22, Rockdale County 66.20, DeKalb County 58.65, Atlanta City 51.96, Clayton County 51.48.
Districts Less Than 55 Percent: Dublin City 53.38, Greene County 53.19, Atlanta City 51.96, Clayton County 51.48, Taylor County 51.39, Bibb County 51.34, Talbot County 44.78, Crawford County 42.25, Baker County 41.38, Taliaferro County 40.0.
(Mike Klein is Editor at the Georgia Public Policy Foundation)
There is this idea out there that the country has a tax code. Actually, it has a tax obstacle course. It is almost impossible to decipher the obstacle course with its many minefields and politicians constantly argue about how to “simplify” it. That is why the annual dust-up between the Tax Foundation and the Center on Budget and Policy Priorities is a fascinating spat.
Each year the Foundation announces Tax Freedom Day – the date on which it says we have worked long enough to pay federal, state and local taxes. This year the Foundation says freedom will arrive next Monday in Georgia and one week later nationally, on Monday, April 17. Are you feeling better?
The theory is that we will work for ourselves the remainder of the year because collectively we will have earned enough to pay our fair share — $2.62 trillion for federal taxes and $1.42 trillion for state and local taxes. Every year the Center on Budget and Policy Priorities debunks the report because it does not like the analysis method. This has become an annual ritual and both organizations talk about each other on their websites.
Monday, April 17 is also when 2011 federal and state returns must be filed unless you receive an extension. First quarter payments for next year federal and state taxes are due the same day so perhaps a lot of folks won’t be feeling like they have Tax Freedom!
Freedom this year is calculated on an “average” American paying 29.2 percent in federal, local and state taxes. Here’s where the Tax Foundation and the Center disagree about what the numbers mean. The Center says the Foundation overstates middle class tax levels and it says states with the highest wage earners are penalized in the formula. The Foundation’s position is that the highly progressive federal tax code creates the result because high wage earners are paying more real tax dollars than low wage earners.
Georgia has a low percentage of the nation’s highest wage earners. The Tax Foundation ranked the state 35th nationally. Last year tax freedom arrived in Georgia on April 3, so we slipped by a week in new rankings, and our overall position changed by two spots from 37th last year. When it recently wrote about Georgia’s 2012 tax reform legislation, the Tax Foundation favored changes that will impact business-to-business transactions, but it said the plan to collect online sales tax is unconstitutional and the Foundation described the reinstated sales tax holidays as a gimmick.
Southern states with their lower comparative personal incomes generally rank low. North Carolina (31) placed slightly ahead of Georgia but Alabama (43), South Carolina (47) and Tennessee (50) trailed. Connecticut is ranked first (tax freedom on May 5) followed by New York and New Jersey tied for second (tax freedom on May 1). Those three states have higher percentages of the most affluent wage earners so their residents are paying lots of taxes.
The Tax Foundation and the Center on Budget and Policy Priorities are caught in a data argument that they seem likely to continue in a sporting fashion. The deep level economic arguments on both sides are fairly fascinating stuff that you can examine in depth on their websites … click here for the Tax Foundation and click here for the Center on Budget and Policy.
Methods aside, the most profound message is the undeniable impact of government expansion and taxation on individuals. The Tax Foundation says Americans will spend more dollars on federal, state and local taxes this year than on food, clothing and housing combined. When you consider that about half of all Americans pay no federal income taxes, those who do pay taxes are paying a lot, their fair share and someone else’s fair share, too.
The Tax Foundation anticipates that state income taxes will eat up 40 working days for the average American, the equivalent of eight working weeks. That figure is slightly skewed because millions of Americans who live in seven states including Florida and Tennessee pay no state income taxes. Georgia has a 6 percent maximum income tax rate that funds about half of the state budget.
The report estimates you will work eleven days to pay your share of corporate income taxes because business taxes flow downhill to consumers. It will take 24 working days – almost five weeks – to pay for Social Security, Medicare and other social programs, 15 days for sales and excise taxes, 12 days for property taxes and seven days for various miscellaneous taxes.
Tax Freedom Day was first calculated in 1948 by a Florida businessman who later deeded his formula to the Tax Foundation when he retired in 1971. Data has been analyzed going backward to 1900 when tax freedom was on January 22. Tax freedom moved in sync with dramatic events such as both World Wars, the expansion of federal government social programs in the 1960’s and the Vietnam War in the 1970’s. The latest date was May 1, 2000, during the final year of President Bill Clinton’s eight-year administration.
Federal stimulus spending, tax cuts, large numbers of laid off workers, and workers earning low wages were factors in the early tax freedom date on April 1, 2009. But the growing canyon between federal revenue and spending has changed the game again. This will be the fourth consecutive year in which Washington will borrow at least $1 trillion. The Tax Foundation said tax freedom this year would not be reached until May 14 if federal deficit borrowing was included in the calculation.
(Mike Klein is Editor at the Georgia Public Policy Foundation)
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