Mayor Soglin wants me to add jobs

Speaking before the Downtown Rotary last Wednesday, Mayor Paul Soglin called on area employers to “commit to increasing their workforce by 1, 2, or 3%.”

My reaction: Mr. Mayor, I’d like to increase my workforce by 10% or 20%! Like other employers, I spend many of my waking hours trying to grow my business and, with all due respect, I don’t need your urging.

Soglin acknowledged that government can’t solve the unemployment problem. “We don’t have the resources.” He is partially correct. Government can’t solve the problem. But even with resources, governments can’t create wealth. Yes, tax-funded job training, mentoring, and transportation can create a somewhat better environment for businesses. Even then, I’m skeptical because so much of what government does with good intentions is not cost-effective. Only private employers can actually create jobs.

At the beginning of his speech, Soglin warned that at the end he was going to do an “ask” in the range of six or seven figures. So after admonishing businesses to grow their workforce, he said, “There’s cash out there. … The way we thank you is by asking you to write a check [to subsidize transportation, child care, and job coaching].” (Silence and sideways glances from the business folks in the audience. Perhaps they were thinking what I was: “I’ll have to wait and see what my new health care costs are before I can think about hiring or writing a check.”)

Government is far more likely to inhibit rather than enhance the job-creation scene. There is a big incentive to figure out how to grow without adding jobs. Taxes, wage and hour laws, equal opportunity regulations, health care costs, and so many other government-created obstacles work against encouraging hiring.

Soglin referred to Walmart and said, “If we could require retailers to pay higher wages and create jobs, they would leave the city.” Correct. And before they did that they would cut their workforce, eliminating the lowest rungs, the less-skilled folks who are most in need of an employment opportunity. This is true of any regulation that forces increased wages or other employment costs. It’s a simple fact that when costs go up on a product or service, less of that product or service is going to be purchased.

I can understand why Soglin brought this message. He truly loves Madison, and as mayor he is not happy to see that in 2011, 25% of blacks were unemployed, while the figure for whites was 5%. In 2006, 33% of all minority households with children were below the poverty level. Today that figure, which includes all of Dane County, has grown to 54%. It’s a shocking 80% in the Town of Madison. That compares to a poverty rate for whites of 9%.

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Soglin compared Madison to Lincoln, Neb., calling Lincoln a “peer city.” He said that Madison is one of the six or seven worst cities in the nation in terms of the economic gap between white residents and blacks and Latinos. Lincoln is doing far better, he noted. Facetiously, he observed that the gap could be closed by bringing down the income of the high-income earners, of which Dane County has plenty.

It wasn’t until the question-and-answer period following his speech that the other part of that income gap was addressed. The first question from the floor was why Madison has done so much poorer than Lincoln.

Soglin admitted that a big part of the problem is, “There are far more low-income families moving into Madison than are moving into Lincoln.” It would have been politically incorrect to add that government should not encourage that in-migration among newcomers who want government handouts and have no real intention of participating in meaningful employment. Soglin, of course, didn’t say that, but it probably was on the minds of many. Following that answer there was, surprisingly, not a single additional question from the audience.

Click here to watch City Channel video of Soglin’s Rotary speech.

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