Saturday, December 06, 2008

Guess The State The Recession Has Not Hit Yet

Much to the interest and chagrin of The New York Times, there is a state in this great land that the effects of the current resicion have not hit at all.
Can you guess the state?
Two hints.
One, it is not Rhode Island, the focus of the previous post.
Two, it is governed by Republicans.
Give up?
Why it is North Dakota, of course!
So the question is how have they done it?
The following from The Times article may help explain it in part

North Dakota’s cheery circumstance — which economic analysts are quick to warn is showing clear signs that it, too, may be in jeopardy — can be explained by an odd collection of factors: a recent surge in oil production that catapulted the state to fifth-largest producer in the nation; a mostly strong year for farmers (agriculture is the state’s biggest business); and a conservative, steady, never-fancy culture that has nurtured fewer sudden booms of wealth like those seen elsewhere (“Our banks don’t do those goofy loans,” Mr. Theel said) and also fewer tumultuous slumps.

I want to focus on the last part of the paragraph.

A conservative, steady, never-fancy culture that has nurtured fewer sudden booms of wealth like those seen elsewhere (“Our banks don’t do those goofy loans,” Mr. Theel said) and also fewer tumultuous slumps.

It is about the banks and the fact that they appear to be responsible and loaning to people and businesses that will pay them back. Thus, one would have to conclude that these banks adhere to strict structures as to how and who to loan to. Too bad a lot of other banks did not follow this approach.
While unployment is around 3.4%, North Dakota is having a problem filling jobs. There are 13,000 unfilled jobs in the state. North Dakota is now branching out to recruit potential employees to such deep recision states as Michigan.
As far as governance, under a Republican governor, John Hoeven, and Republican controlled legislature, the state is experiancing a $1,200,000,000 surplus. A surplus, mind you! And there is talk of property tax relief, a five percent raise for state workers, and more money for secondary education.
In neighboring Minnesota, the state is dealing with a $5,200,000,000 budget deficit.
The moral here as opposed to the post on Rhode Island previously is that responsible governance leads to a strong economy. Not going overboard with big, bloated government is the key to having a strong economy that leads to increased tax revenue and the ability to provide truly nessecary services.
It is too bad that so many states and localities in the United States do not follow the example of North Dakota.

HT: The Other McCain @ www.rsmccain.blogspot.com and Jammie Wearing Fool @ www.jammiewearingfool.blogspot.com

1 comment:

DoorHold said...

Great. You can have economic prosperity, but you have to live in North Dakota to get it.

I'm sure there's a lot to like about living in North Dakota, but apparently, as the free market has shown, it's not enough to fill all those jobs.