finance

Stat Of The Day: America's New Growth Industry

Time for our every-now-and-then-peek into the world of finance, fiscal policy and macroeconomics — and their affect on the body politic. The widely quoted Kent Engelke (see Wall Street Journal, CNBC, Dow Jones, etc.), the chief economics strategist and managing director of Richmond-based Capitol Securities Management, today wrote this in his daily morning commentary, regarding one of the causes of out-of-control government spending at all levels:

About twenty years ago government workers gained incredible power by being allowed to unionize demanding private sector pay while maintaining generous government benefits under the guise that such were required to attract top talent. Twenty years later I believe the pendulum has swung too far. As per the Bureau of Labor Statistics total employer compensation costs are $27.73 per hour in business and $39.81 in state and local government. Wow! Great pay, great benefits and a small probability of losing one’s job. Something is amiss.

Amiss, indeed. In fact, while the private sector is losing jobs, the public sector is adding jobs. Thank you, "stimulus" bill.) The only thing it is stimulating is the growth of government. Six of the wealthiest localities in the country now are those on the outskirts of Washington, D.C., including: Fairfax, Arlington, Stafford and Prince William counties, as well as the city of Alexandria (see Forbes). Not that this has gone unnoticed by the public at large. As Engelke writes, there is a political consequence to the Left's promiscuous unionization of what once was known as public service:

As all polls suggest, most have little regard for Congress reflected by 15% approval ratings. The President’s approval ratings are the lowest of any President at this time in any administration. The major reasons — (lack of)  jobs and out of control fiscal spending.

Lack of jobs, that is, except for those in government, America's new growth industry.

Congrats To Delegate Hugo: New House GOP Caucus Chair

Agreeing and rejecting to Governor Bob McDonnell's amendments Wednesday wasn't the only business going on in Mr. Jefferson's Capitol. When the governor selected former Delegate Sam Nixon to head up VITA, not only did it create a vacancy for his seat, it created a vacancy in the House GOP leadership since he was the House GOP Caucus chairman. In his place, the caucus elected Delegate Tim Hugo (R-40, Fairfax) (see VA GOP Caucus Blog). From Delegate Hugo's news release:

"As a recognized leader within the Caucus, Tim understands the duties required of this position and has the right temperament and experiences to be very successful in his important new capacity," stated Speaker William J. Howell. "During these tough economic times and need to reform state government to make it smarter and simpler, it is imperative that we have an energetic, dedicated and knowledgeable member like Tim joining our leadership team. Like so many, I am looking forward to working with him and our Majority Caucus will be better off because of his leadership."

He will have large shoes to fill, but he has something in common with former Delegate Nixon, which, if it is any indicator of future success, bodes well for conservatives: then-Delegate Nixon, before becoming GOP Caucus chair, was the Virginia Conservative Caucus chairman. Delegate Hugo, first elected to the House of Delegates in a special election in December 2002, has been an active member of the "concaucus" where we have forged an excellent relationship with him. He also is a member of the Commerce and Labor, Finance, Transportation, and Privileges and Elections Committees. He is vice-chair of the Finance Committee and chairs sub-committees in Finance and Commerce and Labor. He represents parts of Fairfax, Centreville, Clifton, and Fairfax Station. We congratulate him, wish him well and look forward to working with him in his new capacity.