NEWS DAY | T-Paw’s math failure and stimulus jobs / Shelter overflow / Health care reform

Math_Symbol_ClipartT-Paw’s math failure and stimulus jobs Governor Tim Pawlenty says that the 11,800 stimulus-created jobs in MN cost $135,000 each — but that’s wrong. MPR reports the explanation offered by MN Management and Budget Commissioner Tom Hanson:

“Of the $1.6 billion, $1.3 billion and change was unemployment and federal medical assistance — money we didn’t have to report jobs on,” Hanson said. “So then about $231 million is the money in which we reported the 11,800 jobs.”

Using simple division, that brings the cost-per-job below $20,000. Simple division may not be the best way to measure the cost of job creation, but if Pawlenty wants to use it, at least he should plug the right numbers into the equation.

According to a news release from Hanson’s office:

Preliminary data suggest broad impact from stimulus funding.  The biggest effect is from state fiscal stabilization funds, where an estimated 5,900 education jobs and another 1,200 public safety jobs were preserved.  Since some schools are drawing most of the funds early in the year, annual numbers may be lower.  Initial reports submitted by the Minnesota Department of Transportation show nearly 900 transportation jobs created or saved.

Stimulus jobs are only part of the economic picture, and another news release from Hanson’s office will be even harder for T-Paw to explain away. Despite the increase in sales tax collections triggered by the Cash for Clunkers program, the October Economic Update shows MN total tax collections down, some 1.7 percent ($52 million) below projections for the first quarter of fiscal 2010.

On a more optimistic note, the MN Management and Budget update said the recession has ended, in technical terms, meaning that the Gross National Product is increasing. That doesn’t mean much to workers, according to the report, which warned that increased employment is still a long way off. Some 17 percent of the workforce was unemployed, involuntarily working part-time, or categorized as discouraged workers in September, and the unemployment rate is expected to continue above eight percent into 2013.

Few forecasters expect to see increases in U.S. payroll employment until after the first of the year and most expect the unemployment rate to move higher until early summer. While labor markets no longer have as many problems as in late 2008 and early 2009 when U.S. job losses averaged more than 600,000 per month, it is unrealistic to expect to see employment growth or a decline in the unemployment rate until the recovery becomes more fully established. Jobs will be added only after hours worked by existing employees have been increased to more normal levels and September’s job report showed average hours worked by production workers at an all-time low.

No room at the shelter Homeless shelters across the Twin Cities report full houses turning people away, according to the Star Tribune. The number of homeless people has risen steadily over the past two years, and some shelters have remained full to capacity even in the summer months. One man, standing in line for a lottery for a bed, explained his situation:

“It’s the first time I’ve been homeless,” he said. Laid off from a job, he’s been looking for housing for the past six months. “When you’re in a situation like this, you just have to deal with it,” Sprew said. “You just have to get up every morning and work at it. … I see every guy here trying. They don’t want to be homeless. Sometimes you just got to suck it up.”

With winter coming on, shelters are searching for a Plan B — any solution that will not leave people freezing on the streets.

Health care reform update The Senate Finance Committee will vote soon — probably today — on what could become the Senate health care reform bill, reports NPR. With a 13-10 Democratic majority, the committee will approve the bill, which will then go to the Senate floor, without a public option.

• Prescription drug spending is part of what has driven U.S. health care costs up, and that spending is driven by advertising, reports NPR.

Prescription drug spending is the third most expensive cost in our health care system. And spending seems to grow larger every year. Just last year, the average American got 12 prescriptions a year, as compared to 1992, when Americans got an average of seven prescriptions. In a decade and a half, the use of prescription medication went up 58 percent. This has added about $180 billion to our medical spending.

Robert Reich writes that the insurance company “study” showing increased premium costs under health care reform should backfire on them:

The only reason these costs can be passed on to consumers in the form of higher premiums is because there’s not enough competition among private insurers to force them to absorb the costs by becoming more efficient. Get it? Health insurers have just made the best argument yet about why a public insurance option is necessary.

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