Tag Archives: economic crisis

News Day: MN unemployment up to 8.2 percent / Foreclosures dip / Preventing the NEXT economic meltdown – or not / more

Illustration of a graph where the figures go through the roofMN unemployment up to 8.2 percent Minnesota’s unemployment rate rose to 8.2 percent in May, up from 8.0 percent in April but still below the national rate of 9.4%, according to the Minnesota Department of Employment and Economic Development. DEED’s press release this morning led with the announcement that MN employers had cut only 1,600 jobs in May, the smallest number since October. Total job losses in May were more than 10,000, but that number was offset by some job gains, including 7,100 in the leisure and hospitality industries and 900 in construction.
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News Day: MN economy’s “gruesome bookends” / IRV or RCV – now legal in MN / Iran elections today / more

MN economy’s “gruesome bookends” Steve Perry writes in MinnPost that Minnesota’s dwindling unemployment insurance fund and tax revenues tied increasingly to the business cycle offer two troubling “bookends” of evidence that the state’s fiscal troubles will continue far into the future. On the UI front, Minnesota has less than two months of reserves, with a year considered healthy, and is expected to join the ranks of states borrowing from the feds to pay unemployment benefits, and running up a debt that will further complicate future budgets.

On the tax side, Perry cites a complex analysis offered by state economist Tom Stinson in a PIM interview with Perry, which explains in greater depth what Perry summarizes for MinnPost as:

To make a long story short, and somewhat over-simple: Through-the-roof revenues from capital gains and bonus income during the bubble years both distorted and inflated state revenues, and led states to cut taxes and expand spending in unsustainable ways.

The PIM interview includes some Stinson recommendations about needed changes in the tax structure, including raising some taxes, changes in capital gains tax treatment, and much more. From a journalistic point of view, it’s somewhat amusing to see Perry in MinnPost referencing and simplifying Perry in PIM. I’m glad he did, as the PIM article is both important and tough reading. Its conclusion: Minnesota tax revenues will not return to pre-recession levels until 2014.

IRV is in The MN Supreme Court ruled that Instant Run-off Voting, aka Ranked Choice Voting, is legal and constitutional and Minneapolis can go ahead and use the choice already approved by voters a couple of years ago. Opponents say they will keep on suing, in other cities that adopt IRV, and probably also in challenges to results of elections using IRV. They don’t really care what the voters say, or what the Supreme Court says. Their lawsuits just increase the costs of IRV for every city that adopts it. The St. Paul City Council is expected to consider IRV now, having delayed consideration to see what the Supreme Court would say.

The FairVote Minnesota press release explains the process:

RCV is a tested, accepted and implementable system by which voters rank candidates in order of preference, ensuring majority winners in single-winner races where there are more than two candidates on the ballot. Under RCV, voters cast their vote for their favorite candidate knowing that if he or she doesn’t gather enough votes to be one of the top two finishers, their votes will count toward their second choice. Votes cast for the least popular candidate are not “wasted”, but rather redistributed to more popular candidates, based on the voters’ second choices, until one candidate emerges with a majority of votes. In multi-winner elections, like the Minneapolis Park Board RCV ensures majority rule while empowering small groups of voters with greater opportunity to elect a candidate that represents them.

Politics in Minnesota explains the expected political impacts of IRV:

Since, of course, the DFL dominates Minneapolis politics, this could let marginalized urban conservatives and independents efficiently consolidate their votes around more conservative candidates. On the other hand, it also frees those to the left of the DFL mainstream to vote for Greens and other lefties, and then safely set a second choice for a liberal DFLer.

You can’t get there from here Stretches of I-94 and I-35W in the heart of the metro area will be closed this weekend. The Strib summary: “All northbound lanes on 35W will be closed from Crosstown Hwy. 62 to 94; all of 35W’s southbound lanes will be closed from S. 60th Street to the crosstown (which will remain open). Westbound lanes of 94 will be closed between 35W and Hwy. 280; access from the Cretin-Vandalia exit in St. Paul will be blocked.”

Minneapolis Police Department layoffs No police officers get the ax, but 17 community service officers will be laid off, a consequence of less-than-expected federal stimulus funding, reports the Strib. In February, Mayor RT Rybak thought the city would get $5 million for police — the actual figure is now down to $3.73 million.

World/National Headlines

Worth-less The personal wealth of Americans dropped by $1.3 trillion in the first quarter of 2009, pushing back to 2004 levels, reports AP. The 2.6 percent decline, mostly in the value of homes and stocks, came on top of earlier losses during 2007-08. On the other hand, “Americans’ personal savings rate zoomed to 5.7 percent in April, the highest since 1995.”

Peru protests move to Lima About 20,000 marched on Congress, amid clouds of tear gas, reports BBC, protesting last week’s violence against indigenous people blocking roads in the Amazon region and protesting against oil and gas drilling.

Confrontations between police and indigenous protesters last week led to the deaths of more than 50 people.

Congress in Lima voted on Wednesday to suspend two controversial land decrees.

Aung San Suu Kyi BBC reports that the trial of Nobel Peace Prize winner Aung San Suu Kyi has been continued to June 26. Suu Kyi has been under house arrest for most of the past 19 years, but her house arrest was scheduled to end in May. Instead, a bizaare incident involving an American who swam a lake to enter her home uninvited led to the government charging Suu Kyi with violating the terms of her house arrest. According to BBC, “Observers believe that Burma’s military leaders will seize on the incident to keep her behind bars during what they say will be multi-party elections in 2010.”

Iran elections today Huge turnouts are reported in today’s presidential elections in Iran, where President Mahmoud Ahmadinejad faces a strong challenge from the more moderate former prime minister Mir Hossein Mousavi, after an intense campaign in which the economy was a major issue. Two other candidates are also on the ballot. BBC notes that:

Iran is ruled under a system known as Velayat-e Faqih, or “Rule by the Supreme Jurist”, who is currently Ayatollah Ali Khamenei….

But the constitution also stipulates that the people are the source of power and the country holds phased presidential and parliamentary elections every four years.

War Reports

Pakistan A senior Islamic cleric was killed in Lahore, reports BBC. The suicide bomber attacked Sarfraz Naeemi at the Jaamia Naeemia madrassa around the time of Friday prayers. Naeemi had denounced the Taliban as “un-Islamic” and also denounced suicide bombing

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News Day: Going up – domestic violence, tick populations / Going down: Auto dealers, Gang Strike Force / “Stagecoach from hell” / Tweet trouble / more

Domestic violence increase “off the charts” Looking at domestic violence, St. Paul police see an “an uptick off the charts,” and Dakota County’s Community Action Council reported a 37 percent increase in women seeking services for domestic abuse from 2007 to 2008, reports the PiPress. The increase in domestic violence is attributed, at least in part, to the economic recession.
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News Day: Unemployment up, benefits down / Central Corridor challenge / Food fights and skateboards / more

help!need moneyUnemployment up to 9.4 percent Seasonally adjusted unemployment rose to 9.4 percent in May, up from 8.9 percent in April, according to the U.S. Bureau of Labor Statistics. The “U-6” number, which includes discouraged workers and those working part-time because they can’t find full-time work rose to 16.4 percent, up from 15.8 percent in April. Comparable numbers for 2008 were 5.2 percent seasonally adjusted unemployment and 9.4 percent, including discouraged workers and part-time workers.
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News Day: All T-Paw, all the time / Vampire pleads guilty / Trees coming down / Recession-proof industry / more

T-Paw signing off – in 2010 As Governor Pawlenty announced that he would not run for a third term as governor in 2010, it seemed that no other news could compete. Here’s the breakdown from Eric Black, who came away from the press conference with the message that “Tim Pawlenty loves God, his wife and kids, the troops and Minnesotans”, as well as the news that House Minority Leader Marty Seifert will run for guv, the PiPress gives a straightforward report,PIM looks at Pawlenty as a Big Mac, with “Secret sauce, secret seasonings. Same thing. Extraordinary tastes for extraordinary times,” but also provides a fact check on T-Paw’s claims of success, MinnPost on possible GOP gubernatorial candidates, and the Strib.
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News Day: GM in MN / Franken-Coleman blow-by-blow / Health care saga / more

MN GM dealers: Who’s going down? Minnesota has 149 GM dealers, reports MPR, and Tuesday they will learn which dealerships will be closed under GM bankruptcy proceedings. Thirty MN dealers had received earlier notice that GM would cut them, but now the company plans to close 40 percent of all its dealers nationwide, which could mean another 30 in Minnesota.
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News Day: Franken and Coleman back at it / “Fong Lee = me” / Republican road to socialism / more

Franken and Coleman: They’re back! Their lawyers will argue the case in the Minnesota Supreme Court on Monday. See the PiPress for profiles of the five justices who will decide the case. Two of the court’s seven justices will sit this one out Chief Justice Eric Magnuson and Associate Justice G. Barry Anderson were part of the recount panel, whose work and decisions are being challenged by Coleman.

“Fong Lee = me” That was the message on the sign held by a young Hmong boy, who was among hundreds of people rallying in St. Paul Saturday to protest the verdict in the Fong Lee shooting death case. The PiPress reports that Fong Lee family members and supporters belive the trial and verdict were unfair.

“I felt that justice failed us, and I feel there ain’t nothing going to happen with it,” said Jon Xiong, 28, of St. Paul. “I got little brothers and cousins and nephews, and it could’ve easily have been them. From my point of view, as a minority, it really ain’t no good. That’s all I can say. It ain’t no good.”

Violence hits young Somalis in Minneapolis Laura Yuen, continuing her fine coverage of the local Somali community offers an in-depth look at the violence that has claimed the lives of eight young Somali men since December 2007, and what some in the community are doing to stop it.

MN Job Watch St. Paul teachers’ contract talks are in trouble before they even get started, reports the PiPress. Reason: the district already announced that it is seeking a pay freeze and “more flexible labor agreements,” thus, according to union reps, starting the negotiations in the press rather than with the teachers.

• “After 30 years, a major labor arts institution is closing its doors,” reports the Minneapolis Labor Review. The worker-run Northland Poster Cooperative will close at the end of June.

• And The Uptake reports on charges of mistreatment of roofers at the Target Center.

Don’t leave home without it Going to Canada? Take your passport, or you might not get back into the United States, reports MPR. Tighter U.S. regulations go into effect today. There is an alternative to the $100+ passport – a lower-cost passport card that can be used just for land border or seaport crossings in the Western Hemisphere, but not for international air travel. More than a million of the passport cards have been issued in Minnesota since they became available in 2008. Processing time takes 4-6 weeks.

Residents near the border may also qualify for a third alternative, the NEXUS card, which is for “trusted travelers who pass a background check by both the U.S. and Canadian governments.” For now, Homeland Security officials say they will take a “commonsense” approach to allowing people to re-enter the United States if they have gone to Canada for, say, a fishing trip.

Disabled and out of luck That was Dan Gunnon’s fate until he hooked up with the Watchdog at the PiPress. Despite chronic back pain, he worked and enjoyed a middle-class standard of living for 20 years after a back injury suffered in 1981: “I tried to save a woman from being assaulted, and I got shot, and the bullet lodged in my spine.” Then, in 2002, the back pain “exploded” and he was no longer able to work. His partner fell victim to cancer, and was also out of work. He applied for Social Security Disability Insurance and:

Like 60 percent of Minnesotans who applied, Don was denied on his first application. He asked for a reconsideration — a request to have a different pair of eyes look at the application. He was denied again. The next step was to file a request for a hearing before an administrative law judge. That’s when he discovered he was caught in a backlog of scandalous proportions: In 2007, about 746,000 claims were pending at the hearing level, 9,000 of them in Minnesota. Some cases had been on the back burner for three years.

SSDI is an insurance program, not a welfare benefit. Like Social Security retirement benefits, it’s paid for by taxes deducted from paychecks. According to the Social Security website, “In general, we pay monthly cash benefits to people who are unable to work for a year or more because of a disability.”

Dan Gunnon got lucky when he found the PiPress Watchdog, who used connections and savvy to find advocates and cut through some of the red tape. Gunnon ended up giving up on back benefits that were clearly owed to him in order to get his benefits started. The story is a testament to good reporting and advocacy by Debra O’Connor at the Pioneer Press, but also a horror story of inadequate staffing and continuing misery for the hundreds of thousands with cases still pending.

World/National Headlines

Doctor shot down in church Dr. George Tiller (67), vilified for performing abortions and shot and wounded by an anti-abortion gunman 16 years ago, was assassinated as he served as an usher inside his Lutheran church in Wichita, KS. A 51-year-old white man is in custody for the shooting.

BBC lists other deadly attacks by anti-abortion killers:

Oct 1998: Dr Barnett Slepian shot dead, Buffalo, New York
Jan 1998: Policeman killed in blast at clinic near Birmingham, Alabama
Dec 30 1994: Two receptionists shot dead at clinics near Boston
July 1994: Dr John Britton and a volunteer escort killed outside clinic, Pensacola, Florida

The Dailyi Kos has a personal remembrance — and a more nuanced picture — of Dr. Tiller.

Bankruptcy on Monday AP reports: “General Motors, the humbled auto giant that has been part of American life for more than 100 years, will file for bankruptcy protection on Monday in a deal that will give taxpayers a 60 percent ownership stake and expand the government’s reach into big business.” The company has already received $20 billion in taxpayer funds, and will get $30 billion more, as it cuts 21,000 employees, about 34 percent of its work force, and reduces the number of dealers by 2,600. The UAW agreed to a cost-cutting deal on Friday.

According to another AP report:

Sen. Richard Shelby said Friday the government should have allowed the marketplace to decide General Motors’ fate and that the huge federal stake in the company puts Washington on “the road to socialism.”

Six months ago? Let’s see – that would be on the watch of the Bush administration, so that would have been a Republican road to socialism?

War Reports

Pakistan Pakistani troops captured the main city in the Swat region, reports BBC, but the city’s center was destroyed in the process. Conditions in the Swat region, according to the International Red Cross: “Water and electricity were not available, there was no fuel for generators, most medical facilities had stopped operating and food was scarce, it said.”

Meanwhile, reports the NYT, heavy fighting has broken out in South Waziristan, the probable next front. And a bomb blast in the North-West Frontier Province town of Kohat killed two people and injured eight others.

Afghanistan When U.S. troops arrived in the Jalrez valley, 30 miles west of Kabul, the Taliban left, reports the NYT. But that may be only temporary:

Insurgents regularly leave areas where Americans appear, only to resurface later. “We are hearing it’s better now,” said Hoji Mir Ahmad, a fruit merchant based in Kabul, “but God knows what things will be like when the harvest comes.”

West Bank Reuters reports: “Six people were killed on Sunday when forces loyal to Palestinian President Mahmoud Abbas raided a Hamas hideout.”

An attack on Palestinian workers by masked, rock=throwing Israeli settlers near the Palestinian city of Nablus injured several men, sending two to the hospital, reports BBC.

Iraq In May, 24 U.S. soldiers were killed in Iraq, reports BBC, the highest number of casualties since September 2008. Combat operations are scheduled to end in September 2010.

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News Day: Windy and green in Woodbury /Fong Lee verdict / Back to Mexico? / more

Forecast: Windy and green in Woodbury Woodbury’s city council is considering several green ordinances and encountering some opposition to expanding wind power, reports the PiPress. Proposed new ordinances include provisions for geothermal heating and cooling in homes, solar panels covering all roof spaces, and ground-mounted solar panel arrays up to 400 square feet in residential areas and 1000 square feet in rural areas.

The controversy comes over wind turbines. The proposed ordinance would allow 60-foot wind turbines in yards of more than an acre. Opponents focus on aesthetics and noise, while proponents say there’s little noise and focus on the benefits of renewable, green energy. Last fall, the Star Tribune reported plans for a 170-foot wind turbine at the high school to produce 30-50 percent of the school’s energy needs, but developers strongly objected, threatening to scuttle plans for a new housing development. Current plans for East Ridge High School, which is located in an R-4 residential area, are unclear – the high school has not yet submitted an official application to the city.

Large wind energy systems (generating 5 megawatts or more) are regulated by the Public Utilities Commission, but smaller installations are subject to local regulation. A brochure published by the Minnesota Office of Energy Security notes that:

Another Minnesota program, net metering, allows home and building owners to install wind generation under 40 kW and connect to the grid. Utilities track the amount of electricity generated and credit the owner for the electricity produced. Any excess electricity not used by the owner is bought by the utility at the average retail rate. Other incentives available from the state include low interest loans and sales tax exemptions.

The Woodbury planning commission will take comments on the proposed ordinance at a June 15 meeting, and the city council will discuss it on June 17.
Fong Lee verdict A jury found that the police officer who shot 19-year-old Fong Lee in 2006 did not use excessive force. The PiPress described an almost-empty courtroom for the reading of the jury verdict, which came when Fong Lee’s family was at lunch and lawyers for both sides were also absent from the courtroom. When the family was informed of the verdict, Fong Lee’s mother burst into tears. According to MPR:

Community activist Tou Ger Xiong says the verdict shows that Minneapolis police officers discriminate against people of color.

“This does nothing more than to reaffirm the fact that we should fear police and members of law enforcement. Because it is saying to us, ‘Watch out, if a cop thinks you pose a threat, you will be killed, you will shot, you will be killed.'”

Fong Lee’s sister, Shoua Lee, said her parents came to the U.S. from Laos in 1988 to find freedom and safety. “And on July 22, 2006, over 20 years later, that feeling of safety was shattered.”

Lee’s family believe he was unarmed and that police planted a gun found three feet from his body. They relied on evidence showing no fingerprints, blood or DNA evidence on the gun, and confused police reports about the ownership of the gun.

Minneapolis police chief Tim Dolan said the officer acted with “courage and integrity.”

Heading back to Mexico? Is the economic recession driving immigrants back to Mexico? Evidence is anecdotal, but the Strib reports that many people are talking about it:

“Workers are thinking, ‘If I don’t have a job here or if I don’t have a job in Mexico, what’s the difference? Plus no one will harass me’ ” in Mexico, said Ramon Leon, executive director of the Latino Economic Development Center in Minneapolis. “And businesses look around and ask: ‘Am I relying on a customer base that may not be here?”’

Nationally, immigrant unemployment rates have risen from 4.6 percent in 2007 to more than 11 percent today, pushing many to consider returning to Mexico. But, as a student at Neighborhood House points out, people who return may find an even worse economic situation in Mexico.

Hard times on the farm A recent U of M survey shows that recession is hitting Minnesota farmers hard, reports the Strib:

Median profits for 2,417 farms included in the survey fell 15 percent in 2008 to $90,039, but that broad measure masks steeper losses for some sectors of the farm economy, particularly livestock operations that paid record prices for feed. The median beef farm profit was a loss of $6,810; the median hog farm profit was $4,876, down from $65,720 a year earlier.

Ford Dam flagged Although there’s no evidence to show any danger at the Ford Dam, the evidence to show that it’s safe is incomplete, reports MPR, so inspectors are coming. They will look at whether water is seeping underneath the concrete dam. The problem is more likely in the paperwork than in the dam, say officials, but they’re checking just the same.

MN Job Watch According to AP, electrical generator maker Kato Engineering will cut 20 percent of its workforce, or 94 jobs. Kato’s plant is in Mankato.

Thief River Falls-based Arctic Cat will eliminate 60 positions, or approximately 5 percent of its 1,200 employees, reports MPR, after losing $9.5 million in the fiscal year that ended March 31.

World/National News

Shrinking economy The U.S. economy shrank at an annualized rate of 5.7 percent during the first quarter, reports NPR. But economists are more optimistic about the rest of the year:

Federal Reserve Chairman Ben Bernanke and NABE forecasters say the recession will end later this year, barring any fresh shocks to the economy. NABE forecasters predict the economy could start growing again in the third or fourth quarter.

War Reports

Pakistan BBC The half-million residents of the steeply mountainous northwestern district of Kohistan don’t want either the Taliban or the army.

“If the army comes in, the Taliban will follow, and vice versa,” says an influential tribal elder and former member of parliament, Malik Saeed Ahmad.

“In either case, it threatens our way of life.”

They also don’t care much about Sharia law — “‘in fact, people are not interested in any government law,” says Mumtaz Khan Jalkoti, a local lawyer.”

In other war news, ten people were killed in two separate bombings in the city of Peshawar.

Iran An Iranian provincial official blamed U.S. “agents of arrogance” for a mosque bombing that killed 19 people last Thursday. The bombing took place in the poor, mostly Sunni province of Sistan-Baluchestan province.

Sudan BBC: “Sudan says more than 60 people were killed during the fighting with the rebel Justice and Equality Movement around the town of Kornoi, in Darfur.” The International Criminal Court has issued a warrant for the arrest of Sudan’s president Omar al-Bashir on charges of war crimes in Darfur.

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News Day: Minnesota’s midnight madness / MN Job Watch / NYT and plagiarism / more

Midnight madness Just moments before midnight, the legislature passed a new tax bill, but it faces certain veto by the governor, MinnPost reports. Governor Tim Pawlenty claimed that he offered a “choice” to DFLers in the legislature, which came down to: you can keep me from making unilateral cuts by agreeing to those cuts, which would make them … not unilateral. Or, as Sen. Tarryl Clark put it: “He left us with two choices. We could do it his way or he would do it his way.’’

In other action during the closing days of the session:
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News Day: Closing the door to college / Five days, a billion dollars / No blood on the gun / more

I’m on the road, so this blog post is short and late — I hope tomorrow will be earlier and longer.

Closing the door to college Minnesota has had a proud tradition of higher education and of making higher education available to its residents. That may be ending, reports MinnPost:

Tuition is rising faster in Minnesota than in most other states. It has doubled since 1999 at the U of M. ..

Meanwhile, state spending for higher education has stuck flat for years in some areas and dropped by double digits in others. Now it is set to fall sharply as the governor and the Legislature wrestle through the current financial crisis.

Although job retraining is essential in times of high unemployment, and although enrollment at Minnesota State Colleges and Universities (MNSCU) jumped by 14% in January 2009, Governor Pawlenty announced a $40 million cut in higher education funding this year, on top of the 28% drop from 2000 to 2007.
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