Be Careful What You Vote For

By Sam Uretsky

You can put ideas together and see where they lead. On May 11, James B. Stewart, whose record in journalism includes a Pulitzer Prize for explanatory reporting, published a piece in the New York Times suggesting that the Republican rush to ban same-sex marriage on a state by state basis may have an adverse effect on the states that enact these laws. He argues the individual states compete against each other for industry, looking for corporations to move in with their headquarters, factories and distribution centers. With this in mind, states offer tax breaks, exemptions from regulations, and right-to-work laws.

This works, up to a point, but companies also look for a well-trained employees, people who are energetic and creative. The red states may make the list for business friendly locations, but the jobs they offer are those most likely to offer repetitive action syndrome. Companies looking for people with energy and creativity may be willing to pay a price, and the workers they want to recruit would rather live in areas with cultural diversity.

In 1996, UBS, the giant Swiss bank, moved its North American headquarters out of New York to a suburb of Stamford, Conn. Last year they admitted their suburban location has become a liability in recruiting. The best and brightest young bankers want to live in Manhattan or Brooklyn. Note that the section of Brooklyn that the young bankers are after has the same cultural diversity as Sesame Street. It’s not that the most creative people are gay, but rather that they are open minded. A large gay population is a surrogate marker for other features that make a location interesting and attractive to young, creative people.

These other markers may be good schools, ethnic restaurants and greenmarkets. The people being recruited for high tech industries aren’t likely to send their kids to schools that won’t teach evolution. The filthy rich may do the hiring, but it’s the young and creative minds that are the real job creators, and the best jobs will follow the people. Bean counters and suits will decide where to put warehouses, but design centers and laboratories will go where the researchers, programmers and designers are. Mr. Stewart’s observations may be confirmed by a recent report from the Pew Center on the States. The Pew Center measured the economic mobility of residents of all 50 states, comparing the chances for personal advancement and the likelihood of retaining the advances. The report states “This study investigates Americans’ mobility prospects during their prime working years – the 10-year span between ages 35-39 and 45-49. The research focuses on individuals born between 1943 and 1958, with the most recent data coming from 2007.”

The period under study then excludes the effects of the election of 2010 which drew many states into the Republican camp. Maryland, New Jersey and New York on all three measures investigated; Connecticut, Massachusetts, Pennsylvania, Michigan and Utah on two of the three measures.

In contrast, the lowest ranking states were Louisiana, Oklahoma and South Carolina on all three measures investigated; Alabama, Florida, Kentucky, Mississippi, North Carolina and Texas on two of the three measures.

Comparing these results with the electoral map of the 2004 election, of the states with the highest economic mobility, only Utah is in the red column. All those states that fell below the national averages were, and remain, distinctly red.

Of the states with the lowest economic mobility, all but Kentucky have enacted right-to-work laws to reduce the effectiveness of labor unions. One of the claims is that unions protect workers with the most seniority, and make it harder to reward the best workers, but the Pew study seems to show that workers in states with strong unions have a better chance of moving up, even compared to others in the peer group, and holding onto their economic gains. Paul Krugman won the 2008 Nobel Prize in Economics by demonstrating the New Trade Theory – that at a certain point, a region will become of center of industry because of the concentration of workers with essential skills, so that companies locating outside that region have little chance at recruitment of the best people.

Partly this is a matter of history – cars in Detroit, finance in New York, entertainment in Hollywood, but also on the willingness of government to attract the people whom industry wants. When the Census Bureau ranked states by household income , 8 of the top 10 were blue states, high tax high service, and Alaska probably made the list because of its annual oil royalty checks. The low tax, low service states, business friendly, took the bottom slots, and they were uniformly red. Progress follows the progressives.

Sam Uretsky is a writer and pharmacist living on Long Island, N.Y. Email sdu01@mail.com.

From The Progressive Populist, June 15, 2012