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Money Matters

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Tennessee lawmakers are making things harder on the poor and easier on the rich, and those old-timey class frictions are heating up in the rifts.

Republicans blame technical glitches and piles of red tape they created as obstacles to get millions of dollars to help low-income families here. Meanwhile, they cut taxes for the business class last year, plan to cut even more this year, and hope to free up more of everyone’s tax dollars to help everyone — no matter how much money they have — pay for private schools.

Gun violence dominated debate and headlines around the Tennessee General Assembly in 2023. Many vow to keep the issue in front of lawmakers in 2024. But if a school shooting in Nashville during last year’s regular session and an entire special session on gun violence last summer won’t move GOP lawmakers to act, rays of hope on the issue seem faint.

It’s way too early to predict what issue(s) may dominate discussions at the State Capitol in the coming weeks. But money seems an early leader, especially as news came late last year that once-hot state revenues are cooling thanks in large part to those 2023 GOP tax cuts.

Money matters have not seen center stage in Tennessee for awhile. The state’s budget has been pushed up and up in recent years with nary a cut in sight. That’s partly due to the new-ish ability to collect online sales taxes and a major surge in revenues from those business taxes in the past. But that won’t likely be the case this year.

Tennessee Gov. Bill Lee is expected to unveil his new budget for Tennessee on Monday, during the annual State of the State address. Projected revenues — how much money officials think we’ll have to spend in the next year — will likely flatten.

This could present some difficult decisions for lawmakers, especially some on the House side, who may have not yet dealt budget cuts. If cuts come, it will be especially interesting to see where the state’s GOP-dominated purse-string-holders will make them (especially since they made the cuts necessary). This could also likely flatten the state’s ability to fund any new initiatives. (Think of it like this, if you quit a job, you might not have the money to pay for your existing car and you damn sure can’t buy a new one.)

Budgets are more than numbers. Budgets are priorities. For a household, that could mean the difference in saving for college later or going on vacation now. For local governments, that could mean the difference in more police or better parks. With its tax cuts last year, the Tennessee GOP prioritized at least one thing: more long-term money in the bank for the state’s businesses.

Now, as money matters begin to creep into the state spotlight once again, some old, tense questions are rising. Who pays for the government? Who does the government work for? Who wins? Who struggles?

So many of these questions have root in Tennessee’s overarching economic development model. That is, basically, how do we organize our economy? How do we build it?

Republicans here love to tout Tennessee as one of the most “business-friendly” states in the union. But don’t just take their word for it. Yahoo! Finance put the state in its top 10 for business friendliness last year and MSNBC ranked it in the top 3, both using different methodologies.

Tennessee’s economy, like many other Southern states, works on the basic trickle-down theory that lower business taxes will attract more businesses, which will hire more people and create more wealth that will “trickle down” to the lower classes.

Except it doesn’t, according to a new report from the Economic Policy Institute (EPI). The high tide promised by this economic theory does not lift all boats, it said. For a more in-depth look at how this plays out in Tennessee and across the South, see below (Economic Policy Institute Report).

Here, we’ll look at some issues and opinions on money and class that might shape debates as the legislature heads back to Nashville.

The lowest 20 percent of earners in Tennessee spend 12.8 percent of their total annual household income on taxes. (Chart: Institute on Taxation and Economic Policy)

The poor and hungry

Back in 2019, The Beacon Center, a free market think tank in Nashville, discovered the Lee administration quietly sat on a stockpile of $730 million meant to help working poor families in Tennessee. For years, Tennessee got $190 million from the federal government to help these families get on their feet with monthly checks for childcare, transportation, and more.

Instead of finding ways to getting all of the money to needy families, Lee just did not. The initial discovery of the funds in 2019 led some on social media to decry Lee’s money management. Others saw GOP disdain for the poor.

“This is why [I march for universal basic income] today, because of villainous shit-holes like the governor of Tennessee who is hoarding $732 M in TANF [Temporary Assistance for Needy Families] money instead of spending it on reducing poverty,” reads a tweet from the time from Scott Santens, founder of the Income to Support All Foundation.

By 2021, the fund ballooned to nearly $800 million. Thanks to Beacon, a plan is now in place to spend that money down.

However, Lee’s plan puts a hurdle between those needy families and the money. Rather than go directly to families in need, the funds will in large part go to organizations or health departments that will give them temporary aid.

Lee administration officials said it has found a home for $717 million of the TANF reserve. But state Sen. Heidi Campbell (D-Nashville) wants more in the hands of actual needy families. Introduced last week, her bill would increase TANF payments to cover rising inflation costs each year.

Meanwhile, thousands of families in Tennessee have less literal food on the table thanks to Lee administration computer problems. Last summer the Tennessee Department of Human Services (TDHS) updated some computer software. A glitch in the system resulted in a backlog of benefits for 35,000 recipients of the federal Supplemental Nutrition Assistance Program (SNAP), sometimes called food stamps.

TDHS Commissioner Clarence Carter said his team hopes to have the backlog cleared by March. He also said he’s not dragging his feet, telling state lawmakers last week that his team has “an almost desperate sense of urgency to get this right.” Tennessee Lookout editor Holly McCall pointed out this “kicker” from their story on the matter: “DHS officials noted that the staff brought in to help are keenly aware of the importance of the work: some department staff rely on food stamps themselves.”

Who pays?

Tennessee has the third-most regressive tax system in the country, according to the seventh annual “Who Pays?” report from the Institute on Taxation and Economic Policy (ITEP). Regressive taxes are those paid equally by all, no matter how much money they make. These, of course, hit lower-income taxpayers the hardest.

In Tennessee, this means the lowest 20 percent of earners (those making less than $21,000 each year) spend 12.8 percent of their total annual household income on taxes. The top 1 percent (those making over $661,600 each year) spend just 3.8 percent of their total income on taxes here. The poorest pay more than three times as much as the wealthy.

“States such as Florida, Tennessee, and Texas are often described as ‘low tax’ due to their lack of personal income taxes,” reads the report. “While this characterization holds true for high-income families, these states levy some of the nation’s highest tax rates on the poor.”

State Senator London Lamar (Photo: Dawn Majors | US capitol)

A tale of two tax cuts

State Sen. London Lamar (D-Memphis) can go back to 2011 and rattle off a list of GOP-sponsored policies “that have truly benefited the wealthy and big corporations.” The repeal of the millionaire estate tax. The repeal of the luxury gift tax. A repeal of income tax on stocks and bonds. A reduction of the jet fuel tax. Corporate exemptions to the sales tax. Exemptions for corporate income taxes.

“Our tax policy is incentivizing businesses for keeping people poor,” Lamar said. “I say that because since 2011 and when the Republicans got in office, the main tax reform and benefits have truly benefited the wealthy and big corporations.

“So, the question is, where are the priorities for those citizens who are working the hardest to contribute to our economy?”

Well, the GOP cut taxes for working-class families just last year. Well, kinda sorta. And it wasn’t much. And it wasn’t forever. But …

Remember that odd, three-month cut on the state’s grocery tax last year? It was a $273 million part of the $400 million Tennessee Works Tax Act, “the largest single tax cut in Tennessee history.” It cut the 4 percent tax for everyone from August to October. Then, the tax went straight back onto receipts.

It was a head-scratcher to many and seemed a solution to a problem that didn’t exist (except, y’know, that Tennessee is one of only 13 states that still tax groceries). Why? Where did this cut come from? Even folks on Reddit couldn’t pin the motivation on some coarse design to win votes because there was no upcoming election.

But it was the remaining cuts in the Tax Act that smarted some working-class taxpayers. While they got a one-time deal that put about $100 in their pockets, the state’s business class got a permanent tax cut worth about $127 million that would put thousands of dollars in their bank accounts each and every year.

The Tax Act seemed to prove Lamar’s notion. Meaningful, permanent cuts for those with means; shallow, temporary cuts for everyone else. (Though, legislation has been filed for this year’s session to permanently cut Tennessee’s grocery tax.)

This might all come into sharper focus later, especially if revenues continue to fall. Because it’s lost revenues from those business tax cuts knocking multi-million-dollar holes in the state budget.

So, should lawmakers indeed need to make cuts to programs it offers Tennessee’s taxpayers, it won’t be because the majority of them got a brief respite from grocery taxes.

Chart: Economic Policy Institute

#VoucherScam

Capitol-watchers have said Lee’s controversial plan to expand his school voucher program could be the biggest fight in Nashville this year. Lee eventually wants to expand the program to every student for any kind of school — public, private, charter, or home.

But the program would allow the vouchers, worth about $7,075 per student each year, for all students, with no income requirements. This means wealthy parents — who now pay taxes for public schools and tuition at private schools — could divert funds from the public school system.

The fight over the legislation may prove to be another class battle that could heat up in Nashville this year. For proof, dig around X for #LeesVoucherScam.

“The voucher scam takes tax dollars from our neighborhood public schools to pay for the private school education of the wealthy,” tweeted Teri Mai, a Democratic candidate running for a House seat in Middle Tennessee. “Simply put, the school voucher scam defunds public schools by funneling your tax dollars to private and religious schools.”

Economic Policy Institute Report

Southern politicians tout the region’s “business-friendly” economic development policies, but a new study finds those policies are rooted in racism and have failed most people who live here.

The October study is from Washington, D.C.-based Economic Policy Institute (EPI), a nonpartisan think tank focused on “the needs of low-and-middle-income workers in economic policy discussions.” The study looks at job growth, wages, poverty, and state GDP. The data, EPI said, “show a grim reality.”

The group characterized the Southern economic development model as one with “low wages, low taxes, few regulations on businesses, few labor protections, a weak safety net, and vicious opposition to unions.”

The state of Tennessee basically agrees with this and shouts it in all caps (literally) on its website under the “business climate” section. 

“We believe in high expectations, low debt, and a pro-business regulatory environment,” reads the page from the Tennessee Department of Economic and Community Development. “Tennessee is proud to be a right-to-work state [also noting Tennessee’s low union participation] with no personal income tax. Our state and local tax burdens are among the lowest in the country, and our state budget operates with a healthy surplus, rather than a deficit.”

The EPI study said this does not work for everyone.

“While this economic model has garnered vast amounts of riches for the wealthiest people across the region, it is leaving most Southerners with low wages, underfunded public services, a weak safety net in times of economic downturns, deep racial divisions, and high rates of poverty,” said report author Chandra Childers, a senior policy and economic analyst for EPI’s Economic Analysis and Research Network. 

Here are a few key takeaways from the report:

• Job growth across the South has failed to keep up with population growth. The share of prime-age workers (ages 25–54) who have a job is lower than the national average in most Southern states.

• Workers in Southern states tend to have lower earnings. Median earnings in nine Southern states are among the lowest in the nation, even after adjusting for lower cost of living in the South.

• Poverty rates are above the national average in most Southern states. Louisiana and Mississippi have the highest poverty rates in the nation, with nearly one in five residents living in poverty.

• Child poverty is highest in the South compared to any other region. At 20.9 percent, child poverty rates in the South are 3.7 percentage points higher than the region with the next-highest child poverty rate — the Midwest (17.2 percent). 

• Southern states are among the lowest-GDP states. Nine of the 15 states with the lowest per-worker GDP are in the South.

The racist remnant of the Southern economic development model, according to EPI, is that business owners in the South continue to rely on “large pools of cheap labor,” particularly Black and brown people. The study points back to slavery in the South when Black people were not paid at all and then to Pullman porters who were “forced to rely on tips” after slavery ended. Now, incarcerated individuals can be required to work with no pay at all, the study said.

“The racist roots of this model have been obscured and have been replaced by a more acceptable ‘pro-business’ narrative,” reads the study. “The pro-business narrative suggests that low wages, low taxes, anti-union policies, a weak safety net, and limited regulation on businesses creates a rising tide that ‘lifts all boats.’”

Tennessee policies fit into this model, the study said, as the state has no minimum wage, no income tax, a high sales-tax burden for all residents, no expanded Medicaid program, a low per-worker GDP, and more.

Poverty is higher in Tennessee than in other parts of the country. This is especially true for people of color and particularly women of color, according to the data. The highest rates of poverty across the South are experienced by Black women. One in five lives in poverty, but it’s not due to an unwillingness to work, the study says. Black women have a higher employment-to-population (EPOP) ratio than women from any other racial or ethnic group in the South.   

“One reason Black women’s poverty rates remain high in the South — despite a relatively high EPOP — is that they are disproportionately employed in jobs consistent with the occupations they were largely limited to during and after the end of slavery: care work, cleaning, and food production, including agricultural and animal slaughter work,” reads the study. “Because this work is largely done by Black, brown, and immigrant workers, consistent with the Southern economic development model, these jobs pay very low wages.”

Wages are lower in Tennessee than in other parts of the country, and again it’s especially true for people of color and particularly women of color, according to the report. 

“On average, Black women in the South are paid $35,884 at the median and Hispanic women just $30,984, compared with $58,008 for white men,” reads the report.

If the Tennessee economic model is working like politicians claim, where does the money go? The study says it goes to the wealthiest Tennesseans. The top 20 percent richest Tennesseans share more than half (51 percent) of the state’s total income. The top 5 percent share 23 percent of the state’s aggregate income. The bottom 20 percent share just 3.4 percent.

“Many Southerners may believe their politician’s arguments that the Southern economic development model will deliver good, well-paying jobs,” reads the report. “However, the data presented here show clearly and emphatically that this model has failed those living in Southern states.” 

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News News Blog News Feature

Greater Memphis Chamber Unveils Prosper Memphis 2030 Plan

(Credit: Memphis Tourism/Alex Shansky)

The Greater Memphis Chamber is looking ahead, and it envisions a bright future. At its Mid-Year Chairman’s Forum Monday, the organization unveiled Prosper 2030, a strategic growth plan that aims to make the Memphis region more prosperous and inclusive.

The plan looks to leverage Memphis’ status as one of the largest minority-majority cities in the country to attract businesses that place an emphasis on diversity in their workforces. Specifically, Prosper 2030 will promote the city’s diversity and upskill its workforce to attract high-growth advanced industries like automotive or medical device manufacturing, which rely on workers with talents in science, technology, engineering, and mathematics (STEM).

“Equity is at the very center of this plan to create a more prosperous, more inclusive Memphis,” said Ted Townsend, chief economic development officer of the Greater Memphis Chamber. “As last year showed, we’re already in the economic development playoffs, but we want the championships. By the end of 2030, we want to be able to point at our regional scoreboard and do the Ja Morant victory dance.”

The Chamber is centering its plan around three key priorities.

Inclusive jobs: A prosperous Memphis is an inclusive Memphis. Goal: Create 50,000 high-quality jobs, with half of those jobs going to minorities.

Diverse industries: A healthy economy has a healthy mix of businesses. The Chamber plans to add to the goal: Add 700 new firms in advanced industries.

Future-ready talent: 20,000 STEM graduates per year, with 45 percent of those degrees going to Black students.

Currently, per the Chamber, Memphis is working on a total of 55 economic development recruitment projects, which represent almost 15,000 new jobs with salaries averaging more than $58,000, and capital investments of more than $10.6 billion. And 80 percent of those projects are in advanced manufacturing.

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News News Blog

The Code Collective Trains Young Adults for Tech

Students practice coding in a CodeCrew class. (Photo courtesy of CodeCrew)

Last month, the Collective Blueprint and CodeCrew were the recipients of an NBA Foundation grant aimed at creating employment opportunities, improving career advancement, and boosting economic empowerment in Black communities. That recognition allowed the organizations to kick off a new partnership that combines their missions into one cohesive program. Called the Code Collective, the unique nine-month course will support young adults as they train to become entry-level software developers.

“It’s a natural partnership for us,” says Sabrina Dawson, co-founder and vice president of programs at the Collective Blueprint. “We believe in supporting the whole young adult, and we know that there are many circumstances that may prevent them from completing a program or their education. If we marry the schooling and instruction that CodeCrew does so well with the support we provide, it really turns into an organic partnership.”

Sabrina Dawson (photo courtesy the Collective Blueprint)

The nine-month program, which starts on June 14th, is available for Shelby County residents between the ages of 17 and 30. Applicants are those who have been out of work at some point in the past year, and must not be currently enrolled in any type of bachelor, associate, or certification program. They are also required to have a high school diploma or equivalent certification.

“We’re offering the software development education class, so you’re going to learn how to code, how to build various applications, and you’ll leave the program with a portfolio which you’ll be able to show to potential employers to showcase your skill set,” says Erin Johnson, CodeCrew’s code school program director. “There will be different modules that teach different skills. Think of it as a gradual process, like moving from a 101 to a 102 level class, and eventually up to 300 level courses.” 

To start out with, classes will be attended virtually. The only in-person interaction will be an interview as part of the application process. “But we’d like to get back in the classroom when COVID calms down,” continues Johnson, “so we’re making arrangements to make that happen.” Applicants will also have to participate in a one-day Code 101 workshop to be admitted, with the next available class taking place Saturday, May 29th.

While CodeCrew provides the technical expertise, the Collective Blueprint will be offering the full gamut of support services that the organization is known for. Each Code Collective participant will receive a monthly stipend of $400, access to a persistence coach, and counseling assistance with any barriers that may pop up during the program.

“That could include things like identifying tutoring support to helping with housing instability,” says Dawson. “We’ll also provide access to mental health support in the form of individual counseling or group/support counseling. We’re also giving them a network of mentors and professional support. Think exposure to work opportunities and job placement support and assistance.”

Who We Are | CodeCrew
Erin Johnson (photo courtesy CodeCrew)

The first cohort can accommodate up to 25 students. But Johnson and Dawson say that if there’s a massive influx of applications, their organizations may look at the feasibility of creating more classes. But for now, the Code Collective will at least have one annual cohort going forward.

“Workforce development is something that we’re both aligned with,” says Johnson. “We want to be able to provide economic and social mobility for young adults, and we also want to be able to better the city of Memphis and see economic mobility. We want to start making a greater impact. We’re both very interested in boosting and diversifying the workforce. We’re both excited about this program, so it’s something we look forward to continuing.”

Graduates of CodeCrew’s adult programs in the computer science field have an approximate annual starting salary of around $51,000.

Read more about the Code Collective Program here.

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News News Blog

Study: Upward Mobility Tougher in Tennessee and Memphis

CREDIT: Courtesy of CodeCrew

Courtesy of CodeCrew

Students practice computer coding with CodeCrew.

It’s tough for Tennessee kids to earn more money than their parents. In Memphis, upward mobility depends a lot on your race and what neighborhood in which you grow up.

Those are some key findings from a new report called Economic Opportunity and Upward Mobility in Tennessee issued Friday from the Sycamore Institute, a Nashville-based public policy research center. Much of the research was done by Dr. Raj Chetty and others from Opportunity Insights, a Harvard-University-based think tank focused on the economy.

The top line from the Tennessee study: “Children from Tennessee are less likely than kids from similar families nationwide to move up the economic ladder from their parents in adulthood.”

The Sycamore Institute

The shot at upward mobility across the country has dropped a lot since 1940. Then, the share of children earning more than their parents was 90 percent. Today, it’s less than 50 percent.

In Tennessee, the shot at economic mobility varies across the state. But not that much, research said. Counties in Middle Tennessee had the highest rates of upward economic mobility. But its average advantage over the rest of the state was just one percentage point. The study found there was also little difference in rural and urban counties when it came to upward mobility trends here. But there were differences.

The Sycamore Institute

The Sycamore Institute

Some neighborhoods offer much better prospects than others, reads the study. The best places for upward mobility tend to have higher socioeconomic status, more married parents, and high employment rates — regardless of circumstances in a child’s own home. Also, Black and white children from the same neighborhoods and income levels often have very different rates of upward mobility.

This is plain when you look at data in Memphis. The study analyzed the chances for upward mobility of children living in Midtown and North Memphis. The differences were stark.

The Sycamore Institute

“A child who grew up in a low-income home in Midtown [Memphis] had about a 16 percent chance of becoming a high-income adult,” reads the study. “One mile away in North Memphis, a low-income child had less than a 1 percent chance. The odds of moving from middle- to high-income were 19 percent for kids from Midtown and less than 1 percent for those from North Memphis.”

The Sycamore Institute

”Whether or not a child’s own parents are married, their prospects for moving up the economic ladder improve when they live in neighborhoods with more married couple families and fewer single parent families,” the study said. “Regardless of wage levels, neighborhoods where more people are employed tend to produce better economic outcomes for their children. While job availability within the local labor market matters, the availability of jobs in the immediate neighborhood seems to have little impact.”

Black and white children have very different rates of upward mobility in Tennessee and Memphis. The probability of a white child in Midtown making more money than their parents is 22 percent, according to the study. A Black child in Midtown has about an 8 percent chance of upward mobility. Researchers could not predict upward mobility chances for a white kid in North Memphis but said Black children there have a shot that’s only greater than 1 percent.

The Sycamore Institute

Categories
Fashion Fashion Feature

Shop This

All economic meltdowns aside, shopping is not life or death. There’s nothing inherently highbrow or meaningful about the exchange of cash for a new pair of must-have shoes, a spiffy new coat, or a lush new sofa. On the other hand, shopping responsibly (defined as locally and within one’s budget) is good for the economy and the soul. So, in the mutual interest of slowing the slowdown and forging new relationships with local retailers, shop well, shop smarter, shop this.

• Anyone who’s read a recent issue of Vogue, or Memphis magazine for that matter, knows that black is, well, the new black. That’s right, black’s back in everything from clothing to makeup. (Beyond mascara, Yves Saint Laurent is showing a classic black lip-gloss this season.) Not quite ready to go all black? Then try this dress from Twelfth Street by Cynthia Vincent. Royal blue and basic black strike the perfect balance. Available at Isabella, 4615 Poplar. Twelfth Street dress — $350

• Big bang, little buck. Oversized and bold, this ring makes quite the statement without making much of an impact on your wallet. Acrylic ring, $9 at Francesca’s, Avenue at Carriage Crossing in Collierville and Saddle Creek in Germantown.

• Black has long been the gold standard of sports watches — at least since the Timex Ironman first hit the streets in 1986. Sports watch technology has no doubt advanced a few light-years since, but the classic black watch remains very much in fashion. The basic, steadfast Ironman can still be had for 40 bucks, but this one comes with a 50-lap memory, two interval times, three alarms, AND it controls your iPod (if only it could program the TiVo). It retails for just under $100 and is perfect for the serious runner who wants to look seriously cool. Outdoors, Inc., Midtown, 1710 Union; East, 5245 Poplar; Cordova, 833 N. Germantown Parkway. Timex Ironman — $99.95

• Black Sheep? Hardly. Downtown’s newest shoe boutique carries L.A.M.B., Vince Camuto, oh Deer!, and more. These gorgeous Betsey Johnson pumps will definitely elevate one’s style — and the gold buttons make them far from basic. Found at Strut, 524 S. Main. Betsey Johnson pumps — $395

Shop This is compiled by Shopgirl. E-mail shopgirl@memphisflyer.com with tips and suggestions for items to be promoted. Please send a daytime phone number and print-quality digital images for consideration.

Categories
Opinion Viewpoint

Topical Depression

It comforts me that Ben Bernanke, chairman of the Federal Reserve Board and an architect of the financial bailout plan, is a specialist in the Great Depression. This, of course, was the economic calamity that beset the United States from 1929 to about 1942 and ended only when America went to war. What stopped the Depression was a worldwide bloodbath.

Anyone who knows the history of those awful times has to be chastened. The Depression was not, after all, simply an economic crisis. It was also a political and cultural one. It contributed to the rise of totalitarian movements abroad — both in Europe and Japan — and some pretty ugly political movements here as well. These things are hard to measure, but American democracy’s closest call probably came during the Great Depression.

The rhetoric in Washington seems oblivious to history. It talks only of financial matters, and it searches, as any mindless politician must, for culprits. Greed is blamed, as if it is something new or controllable, and the entire problem is discussed as if failure will do nothing but endanger some rich institutions and their equally rich managers. The Great Depression teaches otherwise.

Throughout Europe during the Depression came the rise of fascist parties — the Nazis in Germany, the Union of Fascists in Britain, the Croix-de-Feu in France. Elsewhere, communist parties were emboldened. People were desperate, and they looked for desperate solutions.

It is hard to envision anything like this happening again. But why not? The world is a smaller place than it was in 1929. We have become globalized, financial markets intertwined as never before. During the Depression, nations moved to close their borders to refugees. How could more people be let into a country — any country — when those already there were out of work? America, too, clamped down on refugees, even though many of them were fleeing for their very lives. In 1939, the St. Louis, a ship carrying Jewish refugees, went from Germany to Cuba and back to Europe because its passengers were not welcome anywhere on this side of the Atlantic.

It is harder still to envision anything like that happening today. But, again, why not? The zeitgeist changes instantly. Less than two years ago, the world was awash in credit, and then, within months, there was none to be found. The housing market plummeted. Mortgages turned out not to be worth the paper they were written on. Circumstances were suddenly different. If circumstances become even more different, who knows what could happen?

Much has been made of the so-called culture wars in America. The McCain-Palin ticket represents one culture and Obama-Biden another. But this clash is not about culture per se — otherwise, how could the mother of an unwed pregnant teenager be the conservative while her opponents, as conventional as Saturday night at the VFW, are the liberals? No, it’s really about outlook. Barack Obama’s people feel they have control over their lives. Sarah Palin’s people do not have a similar confidence.

This is why the Republican National Convention made war on the media. This is why Palin frequently has referred to “the pollsters and the pundits.” These were the hidden manipulators of the culture and the economy, part of the often-invisible elitists who made it so bad for everyone else. They controlled the culture, the smut that came into one’s home on the TV set and what was playing at the multiplex. They owned the banks and the newspapers and the TV networks — and it didn’t matter that their name could be Rupert Murdoch and they could be deeply conservative. As Don Quixote knew, “facts are the enemy of truth.” Hard times are hard on truth.

The Great Depression was not just a period of wholesale unemployment and incredible poverty — of bread lines and apple-peddlers and women selling brief intimacy for 10 cents a dance. It was also the period of Hitler and Mussolini and, in this country, of Huey Long and Father Charles Coughlin and the belief among otherwise sane people that communism was the remedy for what ailed us. An economic crisis is like war. It’s impossible to contain. It affects everything it touches.

Ben Bernanke knows all this. He might focus on the raw numbers of the Great Depression — “I see one-third of a nation ill-housed, ill-clad, ill-nourished,” Franklin Roosevelt said — but he would also have to know the social and cultural ramifications. You can, if you want, say the bailout program is about the future. But it’s really about the past.

Richard Cohen writes for the Washington Post Writers Group.

Categories
News The Fly-By

What They Said

CREDIT: Greg Cravens

About “House Passes Bailout Bill”:

“Guess I should get out my Che t-shirt and start learning how to goose step.” — 38103

About “The Rant,” by Randy Haspel

“Whatever happens, there IS a credit freeze happening right now. Worldwide. The corporate bond market is in lockdown mode right this minute, nobody’s trading, no lending, no borrowing, hoarding cash for the meltdown. This may well pass with or without a bailout, but don’t think it isn’t real.” — Packrat

About “Bianca Knows Best … And Pushes for Bipartisanship,” by Bianca Phillips: “If there was a God, he’d bless my Winchester.” — KatieDidnt

“I take some comfort in knowing that my liberal, pro-choice, anti-death penalty, pro-environment guns are more accurate than the right wing intolerant ones. Mine have the power of the William Tell principle.” — sbanbury

About “The Veep Debate: Well, Can She Call Him Joe? (Hint: She Did),”
by Jackson Baker:

“She had that great speech all prepared and that biased, nasty Gwen Ifill kept interrupting her with all those questions. What was that about? And who invited Joe Biden?” — B

Comment of the Week:

“It was painfully obvious that Mrs. Palin did not even know the definition of the term ‘Achilles’ heel’ … no doubt because classical mythology is not something taught in End-timer school.”

— denise parkinson

Categories
News The Fly-By

Everybody’s Business

CREDIT: KURHAN | dreamstime.com

Several years ago, a Memphis distribution company had a problem. Because of a nearby traffic signal, cars backed up in front of the company’s drive, making it impossible for departing employees to turn left.

And while the employees might have been stuck, the company realized that it wasn’t.

“This was a major corporation, and they were ready to go to DeSoto County,” says Reid Dulberger, vice president over Memphis and Shelby County’s economic development program. “It’s the same everywhere: The little irritants become big irritants over time because no one is addressing it.”

The former head of the Youngstown-Warren, Ohio, Regional Chamber of Commerce, Dulberger was recently hired to run MemphisED, one part of the four-pronged Memphis Fast Forward Initiative. A combined initiative from Memphis Tomorrow, city and county government, and the Memphis Regional Chamber, the $66 million Fast Forward plan aims to create 50,000 new jobs within five years.

Though the chamber already had a business-retention staff, MemphisED gives additional funding to retaining and growing businesses in the community. Though it may not be as exciting or headline-inducing as a major corporation relocating here, Dulberger says it gets more bang for the buck.

“It’s less expensive to work with existing firms,” he says. “You don’t have to convince them about the value of your community. You’re not traveling to distant cities. You’re not producing expensive marketing materials.”

What it lacks in cost it makes up in labor. The MemphisED staff plans to do 400 site visits with local companies this year, with at least 50 of those visits being to minority- and women-owned businesses. And one may not think a traffic light has anything to do with economic development, but Dulberger would disagree.

“The business owners are saying, we’re here, we’re employing people, we’re paying taxes, and I can’t get the littlest thing done,” he says.

“To an adjoining community in another state, it’s an attraction project. The company is promised the moon and the sun. All of a sudden, they’re being shown a lot of love from another community. They feel like they’re being neglected by their home community — that’s a recipe for losing businesses.”

In the case of the distribution company, once the chamber’s retension staff became involved, the problem was corrected within a few days.

Fast Forward aims to create thousands of new jobs by focusing not just on businesses but on government efficiency, making the community one of the safest of its size and educating the local workforce.

“If this isn’t a safe community, we aren’t going to be creating 50,000 new jobs here. Or, if we do, the jobs will be here, but everyone will live someplace else,” Dulberger says.

Fast Forward has five main goals, 15 strategies for achieving those goals, and 12 partnering organizations, making it truly a joint effort.

“Even the city/county efficiency piece plays a role. The cost of government translates into our local tax burden,” Dulberger says. “To the extent that our local tax burden is high, it doesn’t make it any easier to retain, grow, or attract jobs.”

This isn’t the area’s first economic development plan, but it does represent a change. A study last year said that Memphis and Shelby County had one of the most underfunded economic development plans in the country.

When asked what is different about the current plan, Dulberger says simply, “It’s actually being implemented.”

The plan has both public and private funding behind it; the partners have already begun working on their individual components. The Musicians Resource Center is set to open in June. The Center for Emerging Entrepreneurial Development, an incubator for women- and minority-owned businesses in industries in which they are underrepresented, already has seven of its eight possible tenants.

“Getting a document together is not that difficult. If you have some money, you can hire a consultant, and you, too, can have a plan,” Dulberger says.

And he says that some communities have done exactly that:

“I suppose that will make our life a little bit easier, because it will make our competition that much less effective.”

Categories
News

FedEx Announces Lower Earnings

In a bad sign for Memphis and the U.S. economy, FedEx today reported lower quarterly earnings than a year ago.

“High fuel prices and weak U.S. economic growth year over year have impacted our business,” said Frederick W. Smith, FedEx chairman, president, and CEO. “We continue to benefit from solid international growth, which helps mitigate softness in U.S. industrial production. While we see challenging near-term economic trends, we remain confident about long-term prospects in all our business segments.”

The company earned $1.54 per share for the second quarter ended November 30th, compared to $1.64 per share a year ago.

Revenue was $9.45 billion, up 6 percent from the previous year. Operating income of $783 million was down 7 percent, net income of $479 million was down 6 percent, and operating margin of 8.3 percent was down from 9.4 percent.

Total combined average daily package volume in the FedEx Express and FedEx Ground segments grew 8 percent year over year for the quarter, due to growh in ground and international priority shipments.

For the third quarter, FedEx expects earning to be $1.15 to $1.30 per share, compared to $1.35 per share a year ago. The capital spending forecast has been reduced from $3.5 billion to $3.1 billion, “with additional reductions possible as management continues to review the timing of capital outlays,” the company said in a press release.

Following the announcement of earnings, FedEx stock was lower on Thursday by just over $1 to $93 a share, which is near its 52-week low of $91.

–John Branston

Categories
Opinion Viewpoint

Time To Get Out

The pro-war crowd has been emphasizing the recent drop in American casualties in Iraq, measured by the month, but the fact remains that 2007 has been the most lethal year of war for Americans, and it’s not over yet.

At this writing, 853 Americans have died in 2007, which tops the previous record of 849 in 2004. Altogether, 3,858 Americans have lost their lives in Iraq. The sad thing is that they are dying for nothing, because the cowardly Congress refuses to stop the war by cutting off the funds.

The administration defines “winning” as a stable, democratic Iraq able to defend itself. That’s really a definition of a no-win war. The only way to establish stability with Kurds, Sunnis, and Shiites at each other’s throats is to find another dictator ruthless enough to force stability at the point of a gun. In other words, you can have stability with no democracy or democracy with no stability. Take your choice.

Either way, it is not worth the life of a single American.

It’s time for the American people to face the question, “What’s in it for us?” That’s not being selfish. It’s our blood and our treasure, so surely the American people have a right to expect some gain for this sacrifice. So what is it?

The answer is nothing. The corporate friends of the Bush-Cheney gang have gained plenty of profits, but they haven’t shared them with the dead soldiers — or with the American people, for that matter. Whether Iraq has a new dictator or becomes an Islamic republic aligned with Iran, Americans will have no friends in a country we wrecked while killing at least 100,000 Iraqis and displacing 2 million more. It will be a long time before any nonsuicidal Americans put Iraq on their places-to-visit list.

The Bush administration has been the most secretive and deceptive bunch to occupy the White House in history. The truth is, nobody knows for sure what the motive for going to war against Iraq really was. I read one theory that the neocons, the chief proponents and pushers of the war, envisioned the convicted embezzler and exile Ahmad Chalabi running the country and making peace with Israel. If it’s true, it was a pipe dream based on ignorance. Nobody in Iraq who had suffered through Saddam Hussein’s rule was going to turn the country over to some corrupt exile who had been living the high life in London and Washington.

Regardless of why we went in, it’s past time for us to get out. The Iraqi people don’t want us. As long as we stay, we will be looked upon as occupiers, and the insurgents will keep whittling away at our forces. Occupation cannot be sustained in a hostile environment, and bribery won’t change the way the Iraqis feel. We have done the people of Iraq way too much harm for them to forgive us.

There is no reasoning with President Bush. He’s as likely to attack Iran as he is to withdraw troops from Iraq. The only answer is to pressure Congress to find the nerve to cut the purse strings. There will be enough money in the pipeline to safely withdraw the troops. Keeping young Americans in harm’s way when their lives and limbs will be lost for no gains is not by any stretch supporting the troops. You support the troops by getting them out of harm’s way, just as Ronald Reagan did after we lost the Marines in Lebanon.

Iraq may or may not have a bloody war after we leave. That’s up to the Iraqis. It’s no skin off our nose whether they reconcile or draw their knives. It’s their country. Let them fight over it if that’s what they want to do. The Bush administration has not done one single thing right in the Middle East, and the situation in the whole area is worse and more dangerous because of these blunders.

America’s withdrawal would be a blessing to everyone concerned.

Charley Reese has been a journalist for 50 years.