Hill's economic forum (part 1): Southern Indiana economy

This was the weakest part of the program but still ok. Three problems...

First, it was too closely related to the annual November Economic Forecast Breakfast at IUS. The approach here was wider/broader and more vague than the IUS program. IU's Jerry Conover provided some numbers and useful insight. The rest of it was a dog's breakfast of comments on workforce training, Maxine Brown historical tourism projects, and what such discussions must yield (vague generalities that are mostly obvious).

Second, these sorts of discussions are inherently limited. The odd thing is that economists are best known for making macroeconomic predictions. But such predictions are about as accurate as long-term weather forecasting. (Have you heard the old joke about this? Economists have predicted nine of the last five recessions.) Still, people persist in focusing on the Macro, even though Micro has the most interesting questions and answers. (I often get Macro questions at parties when people find out that I'm an economist: Hey, what are interest rates going to do? Answer: I don't know-- and they don't either.)

Third, it didn't make much sense for Baron to sponsor this session since little of it was related to his role as a Federal legislator. Of course, he (and some of the panelists) saw a federal role in providing grants for this, that, and the other. (Panelists mentioned federal grants for local projects from the Department of Labor, the Department of Commerce, and the USDA.) But aside from a modest role in infrastructure (they talked about that at the end), the federal government's efforts here are neither efficient nor equitable.

To note: Why would we expect that sending Hoosier money to Washington, having them take a cut, attach some strings, and send it back to us is a good way to deal with state and local problems? (The moderator knew this [or stumbled into it] when he noted that federal programs are often not well-tailored to state/local needs.) And if we're getting more/less than our "appropriate" share of "federal dollars", why should they/we pay for the local projects of others?

Conover pointed to the most important issue: a "competitive business environment" at the state and local level, which is a function of economic factors (e.g., cost of land, skills of labor) and political factors (e.g., taxes and regulations). At the end of the day, the federal government can establish a general environment that is more or less friendly to productive behavior (compared to other countries). And state/local governments have the opportunity to be relatively friendly (or not) toward such efforts.

One other thing: a man from the UAW had an impassioned question for the panel about local zoning laws-- and in particular, their use to lock out competitors in the car dealership market. I have written about this in general terms, but don't know much about specifics. I met him afterwards and hope to learn more-- so I can write further about it. Of course, it is exceedingly common for interest groups to use government to restrict their competition. The irony of this man's angst: unions are among the busiest at using government for such purposes-- to restrict competition from non-union labor and from non-union-made products.