Amy Fried, University of Maine
Originally published by the Bangor Daily News on July 8, 2014.
In an odd convergence, 2012 presidential election polls and Gov. Paul LePage’s view of Social Security, “welfare” and the Maine economy now have something in common.
Some of Mitt Romney’s supporters in 2012 embarked on an effort to establish that President Obama wasn’t really ahead. In the most outlandish example, one supporter set up unskewedpolls.com, which, in contradiction to the actual data, “revealed” that Romney was ahead in nine out of 11 swing states. On election night, Obama won 10 of the 11.
“Unskewing” data they didn’t like seeing may have made the unskewers feel better, but it didn’t put Romney in office.
We all want Maine’s economy to thrive, with strong job growth, more money in people’s pockets, businesses booming, and more young people making their lives in our state. Unfortunately, that’s not what’s happening.
Yet the LePage administration released a memo late last month purportedly showing the Maine economy doing better than reported by the federal Bureau of Economic Analysis.
The BEA found that every other New England state had higher growth in people’s personal incomes.
But, the press release complained, “The BEA conceals welfare benefits by calling them ‘Personal Current Transfer Receipts.’ These ‘Transfer Receipts’ include: Social Security benefits; Medicare payments; Medicaid; and state unemployment insurance benefits. In addition to counting welfare benefits as personal income, the BEA includes another category called ‘all other personal current transfer receipts.’ These are the health insurance premium subsidies paid as tax credits to enrollees of the Obamacare exchanges.”
Immediately after this bureaucratic sounding language, came this quote from the governor: “It doesn’t matter what liberals call these payments, it is welfare, pure and simple.”
The memo tried to fiddle with the figures, so that “transfer receipts” don’t count when figuring personal income. This accounting tactic would bring Maine up in the rankings.
After some pointed out the language defining Social Security and Medicare as among those called “welfare,” LePage staffers blamed readers for drawing this conclusion and said he didn’t think of those programs that way.
This political kerfuffle over language obscures what was going on — an attempt to modify the data like the Romney voter’s “unskewed” polls.
Just like playing with polls to make Romney’s support look stronger didn’t shift any votes, unskewing economic reports doesn’t improve Mainers’ lives.
This wasn’t the first attempt to shift economic figures to make Maine look better. Back in March, the Maine Heritage Policy Center criticized U.S. Rep. Mike Michaud, D-2nd District, for noting that Maine was dead last in job growth. It was true, but the Maine Heritage Policy Center claimed the figure was “bogus” because Michaud had not “unskewed” the numbers.
What Michaud should have done, according to the center, was to control the figure for population growth, and this would have made Maine look better.
Now, Maine’s slow job growth is related to slow population growth, itself related to having relatively few young people. Statistically controlling for this reality would have raised Maine’s position in “total job creation” from 50th place all the way up to 41st.
“Unskewing” to move the state up to 41st wouldn’t create more jobs, but Maine’s weak job picture would have looked marginally better.
The governor’s press release referencing Social Security and other programs also relied on a more profound numerical fantasy.
Essentially the governor sees a world where there is real money and imaginary money.
Maine gets more from the federal government than taxpayers send to Washington, but when those funds arrive they’re insubstantial specters, something out of a Stephen King tale.
Thus the unemployment insurance a laid-off, 55-year-old uses to buy firewood shouldn’t be counted. Nor should the health insurance subsidy a family of four making $40,000 a year receives, which enables them to buy snowpants, boots and coats.
Along with hurting people who need health coverage, refusing to expand Medicaid has meant 4,400 fewer jobs, lower incomes, and slower economic growth.
Jobs are fewer and personal incomes lower because the governor froze bonds Mainers voted for, which would have supported construction and economic development projects.
Employees’ paychecks from bonded projects and Social Security checks support Maine jobs, as they’re spent on house repairs, haircuts and holiday celebrations. Local businesses benefit, fueling the economy and making further investment by private enterprise more likely.
Unskewing figures doesn’t change these economic realities.