By Michael C. Bender, Times/Herald Tallahassee Bureau Thursday, December 23, 2010
TALLAHASSEE — Rick Scott, now that he's Florida's incoming governor, he wants to "measure the living daylights" out of state government.
Here's a benchmark: 1.71 million new jobs.
That would increase the state's work force by 24 percent, more than enough to employ every out-of-work Floridian.
It would also fulfill the pledge Scott made this summer when he released details of his ambitious "7-7-7" plan — seven steps over seven years to create 700,000 jobs.
Now that the campaign is over, Scott has to show Floridians "the money."
"Find me 700,000 jobs and I'll do pretty much anything," he joked recently.
New residents, jobs
Scott want to start by adding 1.05 million jobs . . .
That's how many jobs state economists expect to trickle into Florida over the next seven years without any help from the new governor.
Rightrdia isn't sure why Scott is talking about the next seven years because he only has a four year term. We doubt that he will be re-elected.
Scott's economic adviser, Donna Arduin, said these jobs are in addition to what Scott is supposed to create by cutting taxes, reducing spending and eliminating some business regulation.
Arduin warned that Scott can't be responsible for the national economy and the expected growth it gives Florida during the next seven years.
Rightrdia should pont out that the Florida economy is greatly dependent on tourism and the influx of retirees form the north-east and the Midwest. Because of the real estate crises, retirees will have more trouble selling their homes in the north.
Economists also note that In 2004, Florida's nonfarm work force was forecast to top 8.7 million people by now. The most recent count puts it at 7.2 million, or about 17 percent off.
Another problem: It will be difficult to tell which jobs are created thanks to Scott's policies and which ones arrive with the new population.
"You're never going to know which jobs were created because of which event," Arduin said. "There is no way to perfectly tag it."
Another issue is that Scott overestimates his plan.
To smooth the cadence of the "7-7-7" campaign message, Scott rounded the number of jobs the plan would create.
The actual number is 661,914. That number "wouldn't work as well" in 30-second TV ads, Scott said.
Is Scott trying to weasel out of his campaign promise for 700,000 new jobs already?
"Jobs and education," Scott said. "Those are the things that change people's lives."
Scott spent five days on the road this month visiting some of the state's top job producers, including defense contractors in the Panhandle, the aviation industry in Jacksonville and the "Medical City" cluster of biotech companies in Orlando.
Economic investment
Economist David Denslow noted that every new retiree in Florida helps create about one job in the state economy. But every college-educated man or woman who moves to the state creates two.
"For one, they earn more and spend more," said Denslow, research economist for the University of Florida's Bureau of Economic and Business Research.
Fewer regulations
But a detailed version of Scott's plan acknowledges the state's budget woes and notes there will be "minimal" money available for incentives in the first year.
Instead, the plan is for Scott to focus on eliminating regulations, reducing taxes and cutting spending.
Scott's drumbeat for less regulation is expected to be welcomed by a Republican-led Legislature that has complained about over-regulation in Florida.
The Florida government, the governor's mansion, the State house and the senate, have been controlled by the GOP for the past 12 -years. The Florida government is hardly over-regulated.
Arduin estimated regulations cost Florida businesses $10.7 billion in production. Lowering "key regulatory costs" will spark economic growth, according to the plan, and add 237,699 jobs and $1.5 billion to the budget by year seven, according to the 7-7-7 plan.
Scott has yet to isolate a specific regulation he would like to eliminate, but he continues to cite a 2008 study from the Pacific Research Institute, a conservative, California-based think tank, that put Florida as the 45th most regulated state in the country.
"What's the benefit of a regulation, other than a delay?" Scott said.
Apparently the lessons leaned from the Wall Street financial and real estate melt down were lost to Scott.
Cutting spending
Cutting spending and lowering business taxes would bring 364,214 jobs, the biggest part of Scott's jobs plan.
Scott wants to start by saving $300 million this year with a 5 percent cut to the state's work force.
But a report this month shows Florida has 117 state workers for every 10,000 residents and spends $38 per resident. Both ratios were lowest in the country, according to the state Department of Management Services.
If Scott follows his first-year plan, he'll wring another $500 million out with "operational efficiencies," $1.3 billion in changes to the state pension and $1.8 billion in "health care reform."
Unfortunately, the state and local government has been cutting teaching, fire fighter and police positions for the last three to four years.
A classroom size amendment also kicks in this year so Scott will have a tough time cutting more teaching positions without violating the Florida constitution. Scott wants to issue more vouchers which would start the privatization of the Florida public school system.
He is likely to be challenged in court on constitutional grounds if he expands the voucher program.
Scott says those changes would pay for Scott's tax cuts this year.
Scott has said he favors state workers contributing to their pensions, but that would save the state, at most, about $700 million. State workers do not contribute to their pensions, but Florida salaries for teacher and state troopers are low.
Reducing taxes
Scott has targeted a $1.4 billion cut in property taxes the state collects to pay for public schools. Scott wants to make that cut in the upcoming budget and follow it up with another $1.4 billion cut over the next six years.
This will be hard to do because of the class size amendment to the Florida constitution.
But Scott has also pledged to avoid cuts to public schools. That means he'll have to find money elsewhere in a budget already facing a $3.5 billion shortfall.
Scott's plan calls for phasing out the corporate income tax, including a first-year rate cut from 5.5 percent to 3 percent. That would reduce state tax collections by another $835 million.
Florida law only requires corporations that pay federal corporate tax to pay Florida corporate tax. Since S-corporations defer income to share holders, no Florida S-corporation pays Florida corporate tax.
In fact, 98 percent of the estimated 1.5-million businesses in Florida paid nothing. The system is increasingly inequitable for businesses, with just 5,000 Florida companies paying almost all of the corporate income tax.
"What they expect is someone who is going to come in and control spending and do it in a fair manner. And if you do things in a fair manner, you're okay," Scott said. "Maybe I'm naive, but that's my belief."
Rightardia thinks Scott is naive. However, The GOP controls the governors mansion and has super-majorities in the statehouse and senate.
We will see how this grand conservative experiment works out in the next four years.
Rightrdia suspect that the influx of retirees will slow because many people considering retiring will hold onto their jobs until the economy recovers. Others will have difficulty selling their houses.
We suspect Scott's talk about tax savings and greater government efficiencies is fluff.
The Florida government has already been beat to death. There are 131,131 state employees. laying off another 6500 workers will simply add to the unemployment rolls.
Michael C. Bender can be reached at mbender@sptimes.com.
source: http://www.sptimes.com/2003/10/26/State/A_special_report_on_F.shtml
Rick Scott's alter ego, Mr. Burns
Here's a benchmark: 1.71 million new jobs.
That would increase the state's work force by 24 percent, more than enough to employ every out-of-work Floridian.
It would also fulfill the pledge Scott made this summer when he released details of his ambitious "7-7-7" plan — seven steps over seven years to create 700,000 jobs.
Now that the campaign is over, Scott has to show Floridians "the money."
"Find me 700,000 jobs and I'll do pretty much anything," he joked recently.
New residents, jobs
Scott want to start by adding 1.05 million jobs . . .
That's how many jobs state economists expect to trickle into Florida over the next seven years without any help from the new governor.
Rightrdia isn't sure why Scott is talking about the next seven years because he only has a four year term. We doubt that he will be re-elected.
Scott's economic adviser, Donna Arduin, said these jobs are in addition to what Scott is supposed to create by cutting taxes, reducing spending and eliminating some business regulation.
Arduin warned that Scott can't be responsible for the national economy and the expected growth it gives Florida during the next seven years.
Rightrdia should pont out that the Florida economy is greatly dependent on tourism and the influx of retirees form the north-east and the Midwest. Because of the real estate crises, retirees will have more trouble selling their homes in the north.
Economists also note that In 2004, Florida's nonfarm work force was forecast to top 8.7 million people by now. The most recent count puts it at 7.2 million, or about 17 percent off.
Another problem: It will be difficult to tell which jobs are created thanks to Scott's policies and which ones arrive with the new population.
"You're never going to know which jobs were created because of which event," Arduin said. "There is no way to perfectly tag it."
Another issue is that Scott overestimates his plan.
To smooth the cadence of the "7-7-7" campaign message, Scott rounded the number of jobs the plan would create.
The actual number is 661,914. That number "wouldn't work as well" in 30-second TV ads, Scott said.
Is Scott trying to weasel out of his campaign promise for 700,000 new jobs already?
"Jobs and education," Scott said. "Those are the things that change people's lives."
Scott spent five days on the road this month visiting some of the state's top job producers, including defense contractors in the Panhandle, the aviation industry in Jacksonville and the "Medical City" cluster of biotech companies in Orlando.
Economic investment
Economist David Denslow noted that every new retiree in Florida helps create about one job in the state economy. But every college-educated man or woman who moves to the state creates two.
"For one, they earn more and spend more," said Denslow, research economist for the University of Florida's Bureau of Economic and Business Research.
Fewer regulations
But a detailed version of Scott's plan acknowledges the state's budget woes and notes there will be "minimal" money available for incentives in the first year.
Instead, the plan is for Scott to focus on eliminating regulations, reducing taxes and cutting spending.
Scott's drumbeat for less regulation is expected to be welcomed by a Republican-led Legislature that has complained about over-regulation in Florida.
The Florida government, the governor's mansion, the State house and the senate, have been controlled by the GOP for the past 12 -years. The Florida government is hardly over-regulated.
Arduin estimated regulations cost Florida businesses $10.7 billion in production. Lowering "key regulatory costs" will spark economic growth, according to the plan, and add 237,699 jobs and $1.5 billion to the budget by year seven, according to the 7-7-7 plan.
Scott has yet to isolate a specific regulation he would like to eliminate, but he continues to cite a 2008 study from the Pacific Research Institute, a conservative, California-based think tank, that put Florida as the 45th most regulated state in the country.
"What's the benefit of a regulation, other than a delay?" Scott said.
Apparently the lessons leaned from the Wall Street financial and real estate melt down were lost to Scott.
Cutting spending
Cutting spending and lowering business taxes would bring 364,214 jobs, the biggest part of Scott's jobs plan.
Scott wants to start by saving $300 million this year with a 5 percent cut to the state's work force.
But a report this month shows Florida has 117 state workers for every 10,000 residents and spends $38 per resident. Both ratios were lowest in the country, according to the state Department of Management Services.
If Scott follows his first-year plan, he'll wring another $500 million out with "operational efficiencies," $1.3 billion in changes to the state pension and $1.8 billion in "health care reform."
Unfortunately, the state and local government has been cutting teaching, fire fighter and police positions for the last three to four years.
A classroom size amendment also kicks in this year so Scott will have a tough time cutting more teaching positions without violating the Florida constitution. Scott wants to issue more vouchers which would start the privatization of the Florida public school system.
He is likely to be challenged in court on constitutional grounds if he expands the voucher program.
Scott says those changes would pay for Scott's tax cuts this year.
Scott has said he favors state workers contributing to their pensions, but that would save the state, at most, about $700 million. State workers do not contribute to their pensions, but Florida salaries for teacher and state troopers are low.
Reducing taxes
Scott has targeted a $1.4 billion cut in property taxes the state collects to pay for public schools. Scott wants to make that cut in the upcoming budget and follow it up with another $1.4 billion cut over the next six years.
This will be hard to do because of the class size amendment to the Florida constitution.
But Scott has also pledged to avoid cuts to public schools. That means he'll have to find money elsewhere in a budget already facing a $3.5 billion shortfall.
Scott's plan calls for phasing out the corporate income tax, including a first-year rate cut from 5.5 percent to 3 percent. That would reduce state tax collections by another $835 million.
Florida law only requires corporations that pay federal corporate tax to pay Florida corporate tax. Since S-corporations defer income to share holders, no Florida S-corporation pays Florida corporate tax.
In fact, 98 percent of the estimated 1.5-million businesses in Florida paid nothing. The system is increasingly inequitable for businesses, with just 5,000 Florida companies paying almost all of the corporate income tax.
"What they expect is someone who is going to come in and control spending and do it in a fair manner. And if you do things in a fair manner, you're okay," Scott said. "Maybe I'm naive, but that's my belief."
Rightardia thinks Scott is naive. However, The GOP controls the governors mansion and has super-majorities in the statehouse and senate.
We will see how this grand conservative experiment works out in the next four years.
Rightrdia suspect that the influx of retirees will slow because many people considering retiring will hold onto their jobs until the economy recovers. Others will have difficulty selling their houses.
We suspect Scott's talk about tax savings and greater government efficiencies is fluff.
The Florida government has already been beat to death. There are 131,131 state employees. laying off another 6500 workers will simply add to the unemployment rolls.
Michael C. Bender can be reached at mbender@sptimes.com.
source: http://www.sptimes.com/2003/10/26/State/A_special_report_on_F.shtml
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