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3 months ago

Treading water on economic freedom

Economic freedom means the ability of individuals and businesses to contract freely with each other. The Fraser Institute recently released its 2018 Economic Freedom of North America, which rates freedom in the states. Alabama’s economic freedom score remained virtually unchanged from 2017, ranking us 25th among the states.

The state freedom rankings have three equally weighted components, government spending, taxes, and labor market freedom, and complement Fraser’s ratings of the freedom of nations. The scores range from 0 to 10 (the most freedom), and states are graded on a curve for each of the various elements of policy.

Alabama’s score now stands at 6.22, vs. 6.25 in 2017. Florida has the top score in 2018 at 7.87, followed by New Hampshire and Texas; New York brought up the rear (at 3.90), with Kentucky and West Virginia next.

Alabama does best on taxes, thanks to our low income and property taxes, while we trail the national averages for spending and labor market regulation. This year, our score for labor market freedom improved, our spending score declined and taxes remained unchanged.

Economic freedom indices were developed in response to a challenge by economist Milton Friedman about better measuring all the ways government impacts the economy. They have allowed economists to more thoroughly investigate whether markets deliver the benefits promised by some economists. Dozens of studies now document that economic freedom yields higher standards of living, faster economic growth, higher incomes for the poor, and better environmental quality. The strongest results are found internationally, as freedom varies more between nations than across the U.S. states. Still, the states with the most economic freedom have more entrepreneurs and attract more new residents.

And yet in recent years cities and states have enacted or considered laws curtailing economic freedom. For example, three states and Washington, DC, now have $15 per hour minimum wages. Seattle nearly passed a $275 annual tax per employee on large employers, dubbed the Amazon tax. A November ballot proposal in California nearly lifted a 1995 state prohibition on municipal rent control laws. If economic freedom spurs prosperity so significantly, why are so many states embracing freedom-restricting policies?

A first factor, I think, is our now nearly decade-long recovery. People are more willing to share when they feel prosperous. We see this in charitable contributions, and I think it carries over to politics and, specifically, policies intended to help less fortunate Americans. Forcing Amazon and Starbucks to subsidize housing for low-income Seattle families seems like less of an imposition when the companies are earning profits.

Second, the costs of policies restricting economic freedom are often hard to see. Consider the minimum wage. Businesses employ fewer workers in low skilled jobs when the minimum wage rises. But the job losses rarely come in the form of pink slips immediately following an increase. Instead, businesses change their staffing as they typically do, through attrition. Workers never being hired can often go unnoticed.

Finally, the tendency of free-market economists like myself to exaggerate the costs of rent control or the minimum wage contributes. We often claim that ill-advised policies will wreck the economy. Economists have warned that President Trump’s tariffs on imports from China will likely trigger a “crippling” trade war.

Why economists resort to extremes makes sense. News organizations which use alarming headlines to get people to watch or click are more likely to report dire predictions. And perhaps sound bites can only communicate extreme warnings. But dire predictions combined with largely hidden costs make the economy appear impervious to price controls, taxes, and subsidies.

So perhaps it is good news that economic freedom remained basically unchanged in Alabama in 2018. We are largely resisting the temptation to indulge in well-meaning but costly government assistance during a strong economy. When the next recession inevitably occurs, times will be tougher for states not exercising restraint now.

Daniel Sutter is the Charles G. Koch Professor of Economics with the Manuel H. Johnson Center for Political Economy at Troy University.

12 hours ago

Byrne first to officially declare run vs. Doug Jones – ‘Future is too important to sit on the sidelines’

Just down the street from where he grew up, Congressman Bradley Byrne (R-AL) announced Wednesday evening his candidacy for the United States Senate while surrounded by family, friends and supporters gathered at Wintzell’s Oyster House in beautiful downtown Mobile.

Byrne became the first candidate to officially announce a run against the incumbent from Mountain Brook, Sen. Doug Jones (D-AL). In doing so, Byrne made clear his campaign will focus on his record as a fighter for Alabama’s values, drawing a clear and direct contrast between his traditional Yellowhammer State roots and the “radical policies” being pushed by Jones’ Democratic Party.

In his announcement speech, Byrne emphasized, “The fight for America’s future is too important to sit on the sidelines. I am running for the United States Senate to defend the values important to Alabama.”

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The congressman spoke about the “disconnect” between hardworking, everyday Alabamians and people stuck in the bubble of Washington, D.C.

Byrne urged attendees, “Look in Washington and tell me you don’t see people that have a vision that’s fundamentally at odds with what America is.”

“We need a Senator who will fight with President Trump to defend the Constitution, build the wall, stand up for the unborn, push for lower taxes, make health care more affordable and protect the Second Amendment,” he outlined. “I will fight every day to bring Alabama’s conservative values to Washington.”

Answering questions from reporters following the announcement, Byrne decried the Democratic Party’s embrace of socialism and “[killing] babies as they’re delivered.”

He also warned voters that Democrats should be expected to try and interfere in the Republican primary through “fake news” and  manipulative social media efforts. This comes in the wake of revelations that “Project Birmingham” was orchestrated to aid Jones’ general election candidacy in 2017.

Byrne, a labor-employment attorney by trade, is the former chancellor of the state’s community college system and one-term member of the state senate. He has served southwest Alabama in Congress since January 2014.

The Republican primary for the U.S. Senate in Alabama will be held March 3, 2020, with the general election to follow in November.

You can watch Byrne’s announcement speech and hear him answer questions from reporters afterwards here.

Sean Ross is a staff writer for Yellowhammer News. You can follow him on Twitter @sean_yhn

13 hours ago

Watch live: Bradley Byrne announces U.S. Senate run against Doug Jones

Congressman Bradley Byrne (R-AL) is set to announce his candidacy for the United States Senate seat held by Sen. Doug Jones (D-AL) live at the Wintzell’s Oyster House in downtown Mobile.

Watch live below:

Sean Ross is a staff writer for Yellowhammer News. You can follow him on Twitter @sean_yhn

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14 hours ago

Heavy rains swamping Deep South

Heavy rains are causing problems in parts of the Deep South.

Police in Huntsville, Alabama, say a half-dozen roads are blocked by downed trees or utility poles plus water from flash floods.

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Flood watches and warnings cover the northern parts of Alabama, Mississippi, and Georgia and nearly all of Tennessee is at risk for floods.

Several school systems are delaying classes or closing.

The weather service is predicting as much as eight inches of rain in spots through Saturday, and freezing rain and sleet are possible in western South Carolina.

Forecasters say moisture from the Gulf is mixing with weather systems moving eastward in the Mississippi and Ohio valleys.

As much as one inch of rain an hour is possible, and the weather service says some areas could get more.
(Associated Press, copyright 2018)

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15 hours ago

Ivey announces plan to turn old Jefferson County mine into technology park with $85 million economic impact

Alabama is working again — including in places that have been dormant for decades.

Governor Kay Ivey, the Alabama Department of Labor’s (ADOL) Abandoned Mine Land Program (AML) and United States Steel Corporation (U.S. Steel) announced Wednesday that long-abandoned mine land in Jefferson County will be reclaimed, making way for the new Grand River Technology Park project and relocation of the Southern Museum of Flight.

“This reclamation project has the potential to bring millions of dollars in economic impact, and hundreds of jobs to the Greater Birmingham area,” Ivey said in a press release. “The new Grand River Technology Park will be a regional nexus for research and development, tourism, and light manufacturing. This project will bring positive improvements to the citizens who call this community home.”

This project, which is expected to generate an economic impact of more than $85 million, has been made possible through funds appropriated from the U.S. Treasury through the AML Pilot Program Grant. The funding was secured by the stalwart leadership of Sen. Richard Shelby (R-AL), the powerful chairman of the Senate Appropriations Committee.

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In a statement to Yellowhammer News, Shelby said he is looking “forward to witnessing the impact it will have on the state.”

The senator said, “The Grand River Technology Park project will attract new businesses and promote economic development throughout the Birmingham area. I am proud that the AML Pilot grant funds I worked to secure have helped make this effort possible and look forward to witnessing the impact it will have on the state.”

The project is possible through a collaborative public-private effort and includes participation by ADOL’s AML Program, U. S. Steel, the City of Birmingham, the Southern Museum of Flight, Jefferson County and the City of Leeds.

In 2018, U. S. Steel and its community partners were given approval for a $6 million grant by the ADOL AML Pilot Program toward the development of its Grand River Technology Park.

“We are pleased to see the redevelopment of this land. We are grateful for the partnership of Governor Ivey, [ADOL] Secretary Washington, and the AML staff during this process and thank Senator Shelby for securing AML Pilot grant funds. We look forward to providing quality economic and community development projects that will benefit the Birmingham community,” U. S. Steel President and CEO David B. Burritt commented.

The technology park represents a multiphase opportunity to reclaim and transform approximately 105 acres of undeveloped land surrounding and including several pre-1977 abandoned coal mine lands in east Jefferson County. An initial assessment conservatively estimated that 1,200 new employment opportunities will be created by this project.

Plans for the Grand River Technology Park (Contributed)

Dangerous abandoned mine land features previously reclaimed on the property included many portals (openings to old underground coal mines) and vertical openings (former air shafts associated with underground coal mines) connected with Red Diamond Mines #2 – #5, #7, #9, #11 and #12, as well as the former Tennessee Coal and Iron (TCI) Mine #6, all of which ceased operations in 1948.

After the closure of these underground mines, a major portion of proposed development was strip-mined for coal prior to August 3, 1977, leaving extensive spoil piles (waste rock and soil overburden removed to access the coal seam) on the property and a highwall cut (a hazardous vertical bluff left where mining of the coal seam ceased) adjacent to the current location of the Barber Motor Sports Park. Evidence of the highwall cut and spoil piles still remain on the property today. As part of the redevelopment of the property, extensive reclamation will be performed on these remaining spoil piles.

“Our Abandoned Mine Land Program does a wonderful job in helping to ensure that old, dangerous mines are properly reclaimed, which eliminates safety hazards and allows the land to be redeveloped,” ADOL Secretary Fitzgerald Washington advised. “In addition to cleaning up this site and making it safer, this project will help to improve the lives of many.”

To date, the ADOL AML Program has reclaimed 81.6 miles of dangerous highwalls, eliminated 1,613 dangerous mine openings and completed approximately 661 reclamation projects in the coalfields of Alabama.

Sean Ross is a staff writer for Yellowhammer News. You can follow him on Twitter @sean_yhn

16 hours ago

Alabama law requires the state and local governments fund The Democrat-Reporter’s racist rants — It is time to stop

Almost every politician in Alabama wanted to get in on condemning, and in some cases calling for the resignation of the editor, publisher and owner of a rag out of Linden, Alabama, with roughly 3,000 subscribers.

The governor, both United States senators, multiple congressmen and congresswomen, the State Senate pro tem, the lieutenant governor and surely countless others went on the record to say this is unacceptable.

It is obviously unacceptable, but now what? You can’t really force a guy who owns a newspaper to quit. Especially when he seems to think he has done nothing wrong.

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All of this is a minor problem. The Democrat-Reporter is a small-town nothing newspaper. If the Auburn Plainsman hadn’t posted the editorial in the form of a photo, no one would have ever known.

This raises another issue. The state of Alabama is providing revenue to this newspaper and other newspapers around the state of Alabama. And it is actually worse than that: Current state law requires government entities in Alabama to advertise legal notices, legislation, constitutional amendments, voter rolls and other public matters in the local print media outlets, which is not cheap.

So, how much does The Democrat-Reporter get from the governments?

Well, the Alabama Department of Transportation (ALDOT) alone spends thousands every year.

Maybe these aren’t all required expenditures, but for what other reason would ALDOT be spending this money here?

What have the local governments been required to pay this newspaper? What about average citizens and businesses that have to post foreclosures, abandoned property and other matters in a local newspaper by state law?

Even without the racist overtones of this story, this matter should offend you. There is currently a state law that requires we do business with a series of private entities.

This may have been a necessity decades ago, but it is time for the state legislature to readdress this issue for the 21st century.

@TheDaleJackson is a contributing writer to Yellowhammer News and hosts a talk show from 7-11 am weekdays on WVNN