The Crescent Is Fertile Without Your Federal Boondoggle, Thank You

This week’s “Daily Journal” guest columnist is Jon Sanders, Research Editor and Policy Analyst for the John Locke Foundation.

Recently the U.S. House passed something called the “SouthEast Crescent Authority Act of 2007.” Despite the name, the bill wouldn’t regulate crescent rolls in southeastern U.S. shops. What it would do, however, is just as half-baked.

What the SouthEast Crescent Authority (SECA) Act would do is establish a “new regional economic development commission” that would focus on “job creation, worker training, entrepreneurship, and business development” in the Southeast. That’s according to the press office of bill sponsor U.S. Rep. Mike McIntyre,D-N.C. States considered in the “SouthEast Crescent” are Virginia, North Carolina, South Carolina, Georgia, Alabama, Mississippi, and Florida.

The program would cost U.S. taxpayers $200 million over five years – a statement that virtually assures us the program would cost much more than $200 million in the first five years alone. The legislation would task the Authority with setting priorities, approving economic-development grants, and even setting “5-year regional outcome targets.” (What is it about central planners and their five-year plans?)

This legislation comes about despite federal job-training programs having a consistent record of failure – so consistent, in fact, that researchers looking into them have gone from seeing if they work to finding the best explanation for why they fail. Meanwhile, research on poverty in the U.S. finds that its root cause is not structural inequities in society, but bad decisions and behaviors – dropping out of school, having children out of wedlock, engaging in crime, taking drugs, harboring negative attitudes toward employment and employers, having a poor work ethic, and so forth. For that reason, many privately run poverty-fighting programs – which have greater (not to mention positive) returns – include training in “soft skills” so that participants learn personal responsibility, integrity, timeliness, dignity, and other aspects that go hand-in-hand with being employable.

By their very nature, however, federal programs are averse to promoting individual responsibility, being based on the assumption that the problem is solvable by government. So it is that McIntyre announced excitedly, “This is an exciting day for economic development in North Carolina and the southeastern United States!” The congressman went on to say that passage of the bill “brings us one step closer to helping bring jobs and economic development to our area.”

One step closer? Heavens to Dixieland, just how far removed is the Southeast from having jobs and economic development?

Federal data tell the tale. According to the Bureau of Economic Analysis, from 1996 to 2006 the average annual growth rate in per-capita personal income in the United States was 4.2 percent. During that time, the average annual growth rate in per-capita personal income in the seven states comprising the bill’s crescent was … 4.2 percent.

According to the Bureau of Labor Statistics, the unemployment rate in the United States in August was 4.6 percent. For the South, it was 4.2 percent. The BLS’s definition of the South includes some states that aren’t in the targeted crescent, of course, but most of the states in it were likewise below the national average for unemployment.

In short, the Southeast is not a region crying out for federal intervention in its economy, bluster about exciting days for economic development notwithstanding. This superfluous legislation bears all the hallmarks of a money sink, a federal boondoggle rich in its own good intentions but impoverished of actual necessity. The states affected by the bill are growing in per-capita personal income at the same rate as the rest of the country, and on measure the region’s unemployment rate is less than the rest of the nation’s.

Remember those details should the bill become law. What its passage would really bring us “one step closer to” is not jobs and economic development in the Southeast at last (those are well established already), but simply to expanding the program more later. Like all government programs, the new suckling would become adept at jostling and squealing for more — for its own sake.

And just wait till the inevitable debate comes over expanding the program. By then SECA will be hailed as responsible for all positive economic developments in the region, as if right now the Southeast is a vast wasteland of privation, unemployment, and misery compared with the rest of the U.S. Such misery is what limited-government opponents of the legislation will be accused of desiring, perhaps out of racial or regional animus. That’s assuming the existence of any limited-government politicians.

This is no unique prediction. Essentially, it counts on SECA to go the way of all unnecessary government programs thriving off the American taxpayer. As Ronald Reagan observed, “Government programs, once launched, never disappear. Actually, a government bureau is the nearest thing to eternal life we’ll ever see on this Earth.” So if passed, SECA would become only the latest federal scheme to drink forever from the Fountain of You.