Job Squeeze

I keep hearing it said that "government jobs aren't real jobs," that in fact, some assert, government jobs squeeze out private sector employment and actually hurt the economy.

Really?

If people who live in Eastern North Carolina really believe that, they should petition their representatives and senators to close down the Marine Bases at Cherry Point and Camp Lejeune, the Seymour Johnson Air Force Base at Goldsboro, the Army Base at Fort Bragg, state funded institutions such as ECU, and on and on. In Raleigh, the legislature's new budget has cut the funding for the capitol police in half. Can't we do more?

One of the mysteries of political discourse is the ability of participants to hold conflicting views at the same time and actually act on them. This requires a skill at intellectual compartmentalization that I never acquired.

By the way, those who serve in our military actually hold government jobs. When they walk into Wal-Mart or Target, their money looks like anyone else's. Their checking and savings deposits have the same economic effect on their community as anyone else's. And if they lose their jobs through a reduction in force, it contracts the economy just as much as if they had been working for General Motors or Google.

We hear a lot about the GDP. What actually goes into the GDP? GDP equals private consumption and investment, plus net exports, plus gov’t spending. It's as simple as that. Reduce government spending without increasing private consumption and investment, and the economy will contract.

The reason private consumption isn't increasing is that people have no money. The reason companies aren't investing in increased production capacity is that they have ample excess capacity already and can't see a near term increase in customers.

This is elementary business plan stuff. Businessmen (unless they have grown soft in the head) make business decisions based on reality, not on whether the president or members of Congress have hurt their feelings.

Economist Jared Bernstein has a good question and answer posting on his blog today.

In today's circumstances, any reduction in federal spending can only contract the economy. To be sure, some reductions would be worse than others, but right now any reduction will be bad.

As we await news from Washington on increasing the debt limit, I have my fingers crossed that the outcome will be merely very bad (reducing spending when we really need a stimulus) rather than disastrous (going into default).

Excitement in The Town of Oriental

The day began with an 8:30 public meeting of the Board of Commissioners at Town Hall. The meeting was originally called to discuss the board's hiring of a police officer.

There was no quorum, and it turned out there was no need for one. Mayor Sage explained that, after discussing the town's charter and subsequent amendments with the town attorney and with the North Carolina School of Government, it turns out that, under North Carolina law, hiring the police officer(s) is the job of the town manager rather than the board of commissioners.

Then the Pamlico County Board of Elections met at 10:00 to review candidate filings for November's municipal elections. Three municipalities - Arapahoe, Grantsboro and Vandemere did not have as many candidates file as there are openings for elected office. The board of elections decided to exercise the option to extend the filing period by five days for those three towns.

Just before the filing period closed, Ms. Jennifer Roe of Oriental filed to run for mayor of Oriental. There are now three mayoral candidates in Oriental: incumbent mayor Bill Sage, candidate Katy Pugh and incumbent commissioner Jennifer Roe.

Debt Ceiling

We wouldn't be talking about the debt ceiling if President Clinton's budgeting policies had continued. There would be no debt.

Publicly held debt of the United States right now is about 63% of GDP. Most US households would be happy if their debt, including mortgage, car loan, etc. were no more than 63% of annual income.

If the US defaults on its obligations, and you owe any money to anyone, you can expect your payments to increase, because one or more of your payments is likely pegged to US T-bills. This will drag our economy down even more.

Last week a columnist for the News and Observer wrote in glowing terms about the US economy of 1834. If that's where we are going, believe me - you won't like it. Where are you going to stable your horses?

Bastille Day

Happy Bastille Day!

Historian David McCullough puts our ties with France in perspective in today's New York Times.

He gets one thing wrong, though. What we call "French fries," (originally "frenched fries" for the way they were sliced or "frenched") are actually Belgian. Belgians become very agitated when pommes de terre frites are ascribed to France. You can read all about it in Asterix and Obelisk cartoons.

Remember The Preamble?

When I was in high school, one of the things students were expected to do was to remember and recite the preamble to the Constitution of the United States.

Remember it? It goes like this:

Preamble

We the people of the United States, in order to form a more perfect union, establish justice, insure domestic tranquility, provide for the common defense, promote the general welfare, and secure the blessings of liberty to ourselves and our posterity, do ordain and establish this Constitution for the United States of America.

So how come so many conservative commentators rail against the "welfare state?" Our aspiration that the federal government promote the general welfare is embedded in our most fundamental document.

We can certainly debate how best to accomplish all the actions listed in the preamble, but so long as our Constitution defines who we are, we cannot deny the legitimacy of any of them.

Do students memorize such things any more? Or take them seriously?

Economic Recovery Manque [Translation: Missing]

In both economics and politics, the key questions are: "who benefits?" and "who pays?"

For two years now, statistics show the nations' Gross Domestic Product is growing, but people who work for a living don't see the benefit. So what's happening - is the GDP disappearing into a black hole?

Economist Jared Bernstein has tracked it down. Here is where it went.

Very interesting graphic:

Town Of Oriental Charter, 1899

This morning at the Bean before I arrived, an incumbent commissioner loudly disputed with another patron my contention that hiring policemen is the manager's job. The commissioner insists that the 1899 charter provision in Section 3 that the town's officers include a constable, "who shall be elected by the commissioners" authorizes the board of commissioners rather than the town manager to hire the town's police force.

It does not.

Am I certain? Yes, I am. The record is clear, and I can cite chapter and verse.

Earlier today I shared the information with Town Hall:

Special Meeting on Police

From:	David Cox
To:	bob maxbauer ; billsage@townoforiental.com; Warren Johnson ; jenniferroe@townoforiental.com; barbara venturi ; Candy Bohmert

---

"To Town Officials:
I was pleased to learn that the board will meet Friday to address the question of a suitable police force for Oriental. I may not be able to attend much of the meeting that day, because of a prior commitment in Bayboro. Therefore, I want to provide the board of commissioners and the manager with some information I believe pertinent to the hiring procedure.

"As I have pointed out previously, we have a council-manager form of government, established by ordinance amending the charter of 1899, which ordinance was adopted in 1997. North Carolina General Statutes spell out the duties of a town manager in section 160A-148 as follows:
"§ 160A‑148. Powers and duties of manager.

"The manager shall be the chief administrator of the city. He shall be responsible to the council for administering all municipal affairs placed in his charge by them, and shall have the following powers and duties:

"(1) He shall appoint and suspend or remove all city officers and employees not elected by the people, and whose appointment or removal is not otherwise provided for by law, except the city attorney, in accordance with such general personnel rules, regulations, policies, or ordinances as the council may adopt.

"(2) He shall direct and supervise the administration of all departments, offices, and agencies of the city, subject to the general direction and control of the council, except as otherwise provided by law.

"(3) He shall attend all meetings of the council and recommend any measures that he deems expedient.

"(4) He shall see that all laws of the State, the city charter, and the ordinances, resolutions, and regulations of the council are faithfully executed within the city.

"(5) He shall prepare and submit the annual budget and capital program to the council.

"(6) He shall annually submit to the council and make available to the public a complete report on the finances and administrative activities of the city as of the end of the fiscal year.

"(7) He shall make any other reports that the council may require concerning the operations of city departments, offices, and agencies subject to his direction and control.

"(8) He shall perform any other duties that may be required or authorized by the council. (1969, c. 629, s. 2; 1971, c. 698, s. 1; 1973, c. 426, s. 22.)"

"I am told that certain commissioners believe 160A-148(1) does not apply to the hiring of a policeman because Section 3 of the town's charter of 1899 reads as follows:
"Section 3. That the officers of the town shall be a mayor, three commissioners, a constable, who shall be elected by the commissioners, and such other officers as the commissioners may deem necessary and proper, as provided by said chapter sixty-two of The Code [The Code of North Carolina, Enacted March 2, 1883]; Provided that no person shall be a mayor, commissioner or other officer of said town unless he be a qualified voter therein." This, some argue, meets the "whose appointment or removal is not otherwise provided for by law," provision of 160A-148(1). Not exactly.

"There is a problem with citing Section 3 of the charter as authority of any kind: a referendum held November 4, 1993 - the same referendum that changed the membership of the board to five commissioners - repealed both Section 3 and Section 7 of the Charter. The relevant wording of the Act to set a referendum (Chapter 878, Senate Bill 968, Session 1991) reads as follows:

"Sec 3. (a) Sections 3 and 7 of Chapter 184, Private Laws of 1899 are repealed.
(b) The Town of Oriental is governed by a mayor and a board of commissioners of five members. The mayor shall preside at all board of commissioners meetings, but shall have the right to vote only when there are equal numbers of votes in the affirmative and in the negative."

"I bring this to your attention, because I think it is important to comply with the law. In this case, I also believe the Charter as amended provides a sound basis for good management of the town. It allows the board to focus on policy and general oversight and the manager to focus on administering the town. A further benefit is that it provides clear lines of responsibility. No town employee reports to or is supervised in any way by any commissioner or by the mayor.

"I have intentionally not taken a position on particular candidates for the police position(s) because I don't know what the board's policy will be (e.g. how many police, whether they must live in town or nearby, etc.), and I haven't read the resumes of any candidates, don't know the status of any background investigations, their health status or other issues that a hiring authority needs to take into account. It's the manager's job to conduct proper hiring procedures as spelled out in the town's personnel manual.

"I have, however, long supported the concept of at least one full time and one part time policeman.

"I urge you to direct the town manager to begin the search.

"David Cox
Oriental"


This dispute has gone on too long.

Let Us Now Praise Local Pols

I sometimes sit in the peanut gallery and aim (figurative) slings and arrows at local officials.

I have no personal interest in any controversies - I just want things done right. Yes, I have opinions about WHAT should be done to improve our town. My main focus, however, is HOW things are done. I try not to be influenced by personal feelings for or against individuals involved in the process.

This isn't personal - it's business. Public business.

There's another side to the story, though. We should admire all of our fellow citizens willing to step up to the plate and compete for approval of voters for the right to perform long hours of public service, steeped in controversy, often in the face of hostility, for no pay. Of all elected public officials in this land of ours, these are the ones we should most admire.

Let all incumbents know that we appreciate what they do.

For those who have already filed as candidates in November's election, I say thank you. For those still weighing whether to run for public office, I say "do it."