America's Largest Export is Scrap Paper

Boeing, with its commercial airliners, is likely still America's biggest exporter by value of product.  However, the list of America’s biggest exporters by volume will surprise you.

To get a sense of where America ranks in world trade competitiveness, consider the Port of Los Angeles.  Los Angeles hosts America’s largest container port (those rectangular metal boxes), serving the big cargo ships from Asia. 

Look carefully at these statistics from the port.  For every two containers imported into Los Angeles, one returns to Asia empty. 

The contents of that second container being exported is more than likely than not…junk.  The Journal of Commerce tracks U.S. exporters, by volume, at all of America’s ports.  Leading the list of the top 100 exporters is a company called America Chung Nam, whose business is to export scrap paper to China.  Scrap paper.

America Chung Nam exports 2 ½ times the volume of the No. 2-ranked exporter, who also does some business in scrap paper.  The No. 4 exporter, Sims Metal Management, exports scrap metal to China.  Seven of the top 12 exporters do business in scrap.

Hometown Minnesota heroes Cargill come in at 15^th and 3M ranks a distant 53^rd on the list of top U.S. export companies.

Some 27 of the top 100 exporters are in the recycling business—paper, plastics, and metal.  I’m all for Reduce Reuse Recycle, but when your biggest export is scrap, you no longer rank as a First World nation.

Hired Guns, Part 8

An effort was made yesterday in the Minnesota State Senate to suspend the press credentials of the Democrats’ paid reporter, Shawn Towle.

On the Senate floor, Republican Sen. David Hann made the following motion (p. 9351), 

Any credentials issued under Senate Rule 16 to an individual who has received funds from a political organization, as defined in Senate Rule 16.1, paragraph (a), are suspended.  The sergeant-at-arms shall ensure that any individual holding suspended credentials is not admitted to the Senate Chamber. 

Seems simple enough.  However, Democrat Sen. Ron Latz (St. Louis Park) prevented a vote on the motion.  An effort to force a vote failed on a partisan tally of 32-25.

Senate Democrats, having imbedded one of their own reporters inside the capitol press corps, appear more than willing to fight to keep him in there.

Ah, another day in the Banana Republic of Minnesota.

In Part 9 our man Towle is back in the news.

Sunlit Uplands

As the Democrat-led state legislature closes out their 2014 session, the narrative goes something like this:

The Democrats’ patented combination of liberal compassion and out-of-control taxing and spending has somehow produced a booming Minnesota economy in a stinging rebuke to those heartless Republican states like Wisconsin and Texas.

Unfortunately, the facts are getting in the way of a good story.  The state has announced that Minnesota lost 4,200 jobs in April and revised the March job gains downward from 2,600 to a mere 700.

Yet, somehow the state unemployment rate actually fell last month, from 4.8 percent to 4.7.  The only way for that math to work would be that thousands and thousands of unemployed potential workers suddenly stopped even looking for jobs last month.  To have the rate fall, the numerator (unemployed but looking) would have to decline at a faster rate than the denominator (total potential workforce).  Wow.

So not only did a net 3,500 workers lose their jobs in the past two months, many thousands more of the unemployed concluded that searching for a job was not likely to pay off and gave up the effort. 

Those 4,200 newly unemployed workers will not be paying taxes to the state treasury, but instead, will be drawing unemployment benefits.  That won’t help our overall budget picture, which is looking increasingly cloudy.

Earlier this week, the state announced that tax revenue has fallen short of expectations for the second month in a row.  Meanwhile, the Democrats in the state legislature are busy spending the budget “surplus” that looks like it will never materialize.

You heard it here, first.

Cities, Solar Power and the Irresistible Lure of "Free Money"

Over at the Center of the American Experiment, I co-wrote this piece with Kim Crockett on solar power.  We discuss how cities can't turn down "free" money to pay for uneconomic solar projects.

“Help Wanted” for an Upper Midwest Economic Development Strategy

by Bill Glahn and Georgie Hilker

Last month, the Star Tribune reported on efforts by the State of North Dakota (targeted toward Minnesota) to attract workers for some 25,000 unfilled jobs in their booming state (April 13th, “N.D. hopes to lure workers with promises of the 'Good Life'”).

The reaction on this side of the Red River must involve more than merely shipping our workers west.  Our state’s political and business elites should seize this opportunity to do something more.  Minnesota is perfectly positioned—both geographically and economically—to  play a larger role in shaping our region’s economy and the time is now

Minnesota’s present mix of highly progressive tax and crippling regulatory policies are not compatible with becoming the region’s economic hub.  To gain a leadership position, we will need to rethink a range of policies—from taxes, to economic development, to our relationship with neighboring states, and beyond.  The formula for success involves a lot of  hands-on work getting the nuts and bolts of government right, and makes for horribly boring press conferences, but here’s a start:

Build on What We Have

Minnesota, and more specifically the Minneapolis-St. Paul metro area, serves as the regional hub for a vast inland empire stretching from western Wisconsin and northern Iowa to eastern Montana and Manitoba, Canada.  [To get a visual feel for the size of the region, study the map of the Minnesota Twins radio network.]

For example, Minnesota has 7 times the population of North Dakota.  All those oil field developers and related industries have a need for a wide array of business services—banking, accounting, consulting, engineering, insurance, legal, public relations—not necessarily available in Bismarck and Fargo.  Why not cater to this market and steal a march on Denver and Seattle?

Likewise, the major-league sports, shopping, and entertainment venues offered in Minneapolis-St. Paul; the world-class health services available in Rochester; and the Ports of Duluth and St. Paul and the MSP airport with their worldwide trade access, should make Minnesota the linchpin of the entire region. 

Embrace the Energy Revolution

Just like Houston in Texas or Calgary in Alberta, Minnesota could serve as the hub of a North Central energy empire:  oil, natural gas, and coal in the west, hydropower to the north, pipelines, refineries, and, yes, wind power at home.

North Dakota is not the only state in the Midwest with abundant natural resources; it is simply the state most willing to develop them. 

Minnesota, too, has resources—iron ore, copper and nickel, and sand—all available for development, in an environmentally-sound manner, of course.  Again, the skilled, blue collar (and likely union) mining jobs up north and down south will create demand for  “knowledge-worker” services offered in the Twin Cities and regional centers, including Duluth and Rochester.

Create a Silicon Prairie

California’s Silicon Valley benefits from its close proximity to world-class universities.  Rather than perpetuate rivalries with neighboring universities in North Dakota and Iowa, why not join forces and seed a Silicon Prairie in the Upper Midwest?  It would merely require abandoning the partisan view of Minnesota as a progressive island in a sea of conservatism and, instead, seeing Minnesota as the vital core of a larger, regional economy.

Be the Convener

We must stop thinking of bordering states as competitors and start considering them as our collaborators.  We should start hosting regular business summits with our regional partners and build upon the strengths each one of them brings to the marketplace.

In considering the North Dakota job openings, we need to think creatively about how to supply their needs for goods and services with the well-educated and skilled workforce available here.  In doing so, we can  begin to build the kind of regional economic framework that will ensure the Upper Midwest will no longer be considered "flyover land".

What’s Going on with the Campaign Finance Board?

Minnesota’s Campaign Finance and Public Disclosure Board oversees state elections, candidate finances, and the activities of registered lobbyists.  According to Minnesota Law (§10A.02 Subd. 1), “No more than three of the members of the board may support the same political party.”

At present, there are only five Members of the Board, with one vacancy.

One member, Neil Peterson, is a former Republican state legislator representing Bloomington.  Another member, Ed Oliver, was a former Republican state senator representing Deephaven.  According to records on file at the Campaign Finance Board, Sen. Oliver made more than $300 in cash and in-kind donations to the Independence Party candidate for governor, Tom Horner, in 2010.

The Chair, Deanna Wiener, is a former Democrat state senator representing Eagan.  Another member, Christian Sande, once ran for the office of Minnesota Secretary of State as a Democrat.  Vice Chair George Beck is an attorney and arbitrator.  Beck, of St. Louis Park, donated $1,000 in cash and $322 in food for a fundraiser for Democrat Mark Dayton’s 2010 campaign for governor.

A sixth member, retired district court judge Jon Stafsholt, was appointed to the Board by Governor Dayton, effective March 1^st of this year.  In his application for a seat on the board, Judge Stafsholt checked the box under political party for “no party preference.”  However, in the narrative of his application, Stafsholt wrote that “However, many years ago as a young lawyer, I was involved in the DFL party.”  (See his application, PDF page 3).

Stafsholt is no longer listed as a member of the Board although his name appears as a board member on this document.

Three of Dayton’s appointees—Oliver, Sande, and Stafsholt—are up for confirmation by the State Legislature.  To be confirmed, both houses must vote in favor with a 3/5^th majority.  The State Senate lists Oliver and Sande as having been confirmed late last month by that body.  The nomination of Stafsholt was removed from the agenda of the April 23^rd Senate Rules Committee meeting at which the nominations of the other two board members were considered.  All three candidates had been considered by the elections subcommittee previously on April 10^th.

Very curious.

Hired Guns, Part 7

I’m not a journalist, so to help my understanding of the implications of l'affaire Towle; I contacted the Society of Professional Journalists (SPJ) to get an expert’s take on the matter.

Towle is the credentialed political reporter who has taken cash from the Republican Party for consulting and, more recently, from state senate Democrats for opposition research.  This post is the seventh part of a series [1, 2, 3, 4, 5, and 6] on the subject.

Responding to my SPJ request was Fred Brown, a former political reporter for the Denver Post (he still writes columns for the paper), a past president of the SPJ, and currently Vice Chair of the SPJ’s ethics committee.

Hired Guns, Part 6

Now we know.  For months we’ve been asking what credentialed political reporter Shawn Towle did to earn the $40,000 he has been paid by state senate Democrats since 2012.

The indispensable Politics in Minnesota correspondent James Nord reports that the money from Democrats went to pay for…wait for it…candidate and opposition research.

Nord writes,

It turns out he was paid by the DFL Senate Caucus’ campaign arm for candidate and opposition research for use mostly in TV and radio ads leading into the operations’ fall 2012 election campaign.

Hired Guns, Part 5

Yesterday, controversial political reporter Shawn Towle fired back at his critics on his blog Checks & Balances. 

This post is the fifth part of a series [1, 2, 3 and 4] on the payments by state senate Democrats ($40,000) and state Republicans ($5,250) to the accredited member of the senate press corps for “research” and “consulting.”

For his part, Mr. Towle posted an open letter yesterday [one of two] defending his conduct in accepting payments from political parties.

Hired Guns, Part 4

A while back, I wrote a series of posts [1, 2 and 3] on the state senate Democrats’ hiring of accredited member of the senate press corps, Shawn Towle, to do “research.”

Credit should go to Star Tribune reporter Baird Helgeson, who picks up the story today and liberal blogger Sally Jo Sorenson, who wrote her own Hired Guns, Part IV post this evening.

[Update: the Citypages' Aaron Rupar has a more in-depth story up at his blog this morning.]

Interested readers should take a look at all three pieces, and I won’t cover the ground they cover.  But I do have a few points to make that I’ve not seen elsewhere,

The Star Tribune’s Helgeson reports,

Towle said he actually got his Senate credentials when the Republicans controlled the body and [now Senate Minority Leader David] Hann was an assistant leader.

Around that time, Towle was also on the payroll of the Republican Party of Minnesota’s payroll [sic].  The state GOP paid Towle a combined $15,000 in 2010 and 2011, records show.

Yes, the Republican Party of Minnesota paid Towle’s company, Key Strategies, $9,750 in 2010, all of which went for advertising.

Redundancies and all, Helgeson’s reporting that advertising represents a “payroll” position demonstrates the age-old adage that unclear thinking produces unclear writing.

More seriously, the Republican Party paid Towle’s company $5,250 in 2011 for “political consulting.”

But it’s also true that the state Republican Party does not accredit journalists, which state senate Democrats do.

The same argument should have held in 2011: a paid political consultant in the employ of a political party (any party) should not have received press credentials.  Tu quoque (“you did it, too”) defenses should not be accepted, regardless of the party making them.

The questions that remain are these:

Should a reporter in the employ of a political party (for research, consulting, or similar purposes) receive official press credentials?

What role did current Senate Majority Leader Tom Bakk in hiring Towle?

What research did Towle provide to senate Democrats in exchange for $40,000 of payments?