Morning Must Reads: Job Numbers, Property Taxes and Smart Growth

The Pennsylvania Department of Labor and Industry reported Thursday that the number of jobs in the commonwealth grew by 13,800 in October, as the unemployment rate fell slightly to 8.1%. A key factor in October's relatively good performance was a pause in public-sector job losses.

So the good news is we had one positive month; the bad news is unless we have more months like October, the labor market is more or less stuck in neutral. Back in January, we estimated that the jobs deficit in Pennsylvania was 257,000 jobs (this is the number of jobs Pennsylvania needs to get back to full employment). The October jobs deficit is just over 237,000 jobs. In other words, the pace of job growth is such that we are back to full employment in more than eight and half years.

Weak job growth also means less revenue for local governments. Lackawanna County is set to raise property taxes by 38%.

Paul Krugman fan boys and fan girls (you know who you are) will note that in his column this morning he is hopeful that the supercommittee will fail mainly because success now would certainly hurt the economy and only an election can properly sort out where voters stand on how best to achieve long-term deficit reduction.

Why was the supercommittee doomed to fail? Mainly because the gulf between our two major political parties is so wide. Republicans and Democrats don’t just have different priorities; they live in different intellectual and moral universes.

Speaking of different intellectual and moral universes, I came across a pair of stories in the Lancaster Intelligencer Journal and Central Penn Business Journal this morning on the shared problems of local governments.

The Intelligencer Journal story notes an effort in Lancaster County to encourage smart growth. Managing growth in a way that leads to less sprawl is good for the environment and also would help reverse the longer-term revenue and economic development problems that have forced many governments to seek state assistance through Act 47.

The Central Penn Business Journal story frames the problems facing local governments as wages being too high and too much regulation.

Coalition for Smart Growth President Mark Hackenburg said smart growth focuses on using existing infrastructure to its greatest values.

'So infill and growing within our existing communities is not a bad thing. Everyone benefits. There is an economic benefit to rehabilitate and reuse existing areas,' he said. 'We can retain the character of our communities by protecting historic resources, by protecting environmentally sensitive areas, reducing outward growth pressures on prime farmland.'

The issues are nearly identical for all fiscally challenged cities — declining population and tax revenue, high pension and health care costs, blighted and tax-exempt properties and heavy debt. Other challenges include the rules of Act 111, which sets bargaining and arbitration for police and firefighters.


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