Indiana
Hicks: Mindless economic development strategy in Indiana? No thank you – The Daily Reporter – Greenfield Indiana
Michael Hicks
The previous couple weeks noticed Hoosier leaders rejoice two new manufacturing facility bulletins within the state. Collectively they promise 1,900 manufacturing facility jobs and roughly $4.6 billion in new funding. Unsurprisingly, that is the form of factor elected leaders prefer to tout. The sunny financial improvement press launch is older than the nation and is an particularly bipartisan indulgence.
Nonetheless, should you take note of this form of jobs announcement, there’s no method round a sense that one thing isn’t fairly proper. The explanation for that is extra than simply intestine intuition; a lot of what you see and examine these jobs bulletins is uncooked political fiction. Refined taxpayers ought to perceive higher what is going on. There are three elements that make me very uneasy and may fear taxpayers and accountable elected officers alike.
The primary is the boldness of the claims, and the argument that job creation offers comprise a big a part of the financial system. That is flat nonsense. In a typical yr, Hoosier companies create about 0.5 million jobs throughout the state and destroy about 0.5 million jobs elsewhere. In some years there are extra created than destroyed, and in different years we lose extra jobs than are created. Both method, these 1,900 jobs unfold out over the following few years are a measurement error in Indiana’s labor market dynamics.
The identical is true with the capital funding. In the present day, Indiana has greater than $0.5 trillion in capital funding. The aforementioned $4.6 billion sounds good, however unfold out over two or three years is unlikely to account for 1/1,000 of the state’s capital funding in any yr. As with the employment numbers, that is actually inside the vary of measurement error of enterprise capital.
In a very good yr, the state’s financial improvement organizations will work together with companies that create perhaps 4.0% of recent jobs. That could be a exceptional achievement for the small, hardworking employees at IEDC, however it doesn’t present proof of statewide financial efficiency.
Our civic discourse can be higher off if elected officers have been extra sincere about these offers. However, given the bipartisan zeal for job bulletins, it’s as much as the remainder of us to coach ourselves. Nonetheless, political exploitation of those offers ranks on the backside of my three worries. What bothers me extra is the general public spending for these jobs.
Boone County and Howard County, the place these factories will find, have unemployment charges at 3.1 and three.8% respectively. Thus, there isn’t a available workforce for these factories. Historically, this vacuum would draw labor from 30 or so surrounding counties. There may even be some in-migration as a result of each counties have enticing communities. Nonetheless, many of the workers will come from different companies already within the space or exterior the county.
In a free market financial system, that shifting of employees is ok; new companies have each proper to lure workers away from current companies. Nonetheless, what is going on right here is absolutely the antithesis of a free market financial system. We don’t but know what the tax incentives will likely be for the Lilly manufacturing facility in Boone County, however incentives are roughly $130,000 per job for the Howard County plant. That’s simply insanely irresponsible for a lot of causes. Some may even name it “Socialism.”
A lot of the motivation will come from native taxpayers, together with these companies whose employees will now be lured away by somebody paying no taxes in these communities. The advantages of those jobs will circulate to the locations the place these employees stay, leaving Boone and Howard County taxpayers to pay many of the prices whereas many of the advantages accrue elsewhere.
The state contribution to those incentives is efficiency primarily based; the native contribution is an upfront cost with no life like claw-back choices. It’s a dire mistake in state coverage to view a tax giveaway as “pores and skin within the recreation” whereas native spending on good faculties, secure neighborhoods and paved streets as not.
Even when these communities acquired all the advantage of this deal as a substitute of the extra life like 10%, it’d nonetheless be a troubling public expense. Paying $130,000 per job to lure a brand new manufacturing facility to Indiana makes for nice headlines and pleased press releases whereas nonetheless being the very definition of short-term, poorly knowledgeable tactical pondering. Tax incentives aren’t a viable financial improvement technique.
If Indiana’s financial improvement technique is to pay $130,000 per manufacturing facility job, we’re failing. One of the best ways to grasp that is to easily be aware that the price to carry again the manufacturing facility jobs we’ve misplaced over the previous 20 years alone is greater than $16 billion or roughly $5,600 per Hoosier household. Once more, if that is Indiana’s financial improvement technique, we should always put together ourselves for pricey, repeated disappointment.
The Howard County manufacturing facility is an auto elements manufacturing agency. The state has misplaced over 40% of jobs on this sector in 20 years, and we’re 10% beneath the place we have been on this sector in simply 2019. These new 1,400 jobs account for under 2.2% of whole jobs on this business. By the point these incentivized jobs materialize in two or three years, we’re prone to have misplaced one other 5,000 auto elements manufacturing facility jobs. From a strategic standpoint, these incentives are like shopping for gold-plated buckets to bail out the Titanic.
A good worse revelation is that this business pays wages which might be 16% beneath the state manufacturing common. Which may clarify why the roles announcement was so unusually silent on salaries. Once more if that is profitable financial improvement technique, I shudder to think about what a failing technique may appear to be.
Regardless of the imprudence of the tax incentives, my greatest concern about this deal just isn’t about poor political management. I’m underneath little phantasm that the opposite political get together can be extra accountable with tax {dollars}. I’m extra fearful about what it says concerning the high quality of companies and enterprise management we’re attracting to the state.
Indiana’s tax on manufacturing companies is as we speak the fourth lowest within the nation. To place this in stunning context, a single mom making $35,000 a yr pays twice the efficient state and native tax fee of the typical manufacturing agency within the state. Likewise, non-manufacturing companies in Indiana pay almost thrice the typical tax charges as factories. It’s value noting that non-manufacturing companies are those accountable for 180% of the state’s job progress since 2000. Attempt pondering on that for a couple of minutes.
The message to companies ought to be plain. If paying the fourth lowest tax within the nation is just too onerous on your manufacturing facility, you don’t have a viable marketing strategy. Indiana doesn’t want you; go elsewhere. If your enterprise needs to make use of our public infrastructure, our public companies (e.g., police and fireplace safety) and our graduates from public faculties and universities however expects others to pay the invoice, don’t come to Indiana. The state wants fewer enterprise leaders like this, and that’s exactly the message prudent, considerate, market-oriented leaders ought to give to companies.
Michael J. Hicks is the director of the Heart for Enterprise and Financial Analysis and the George and Frances Ball Distinguished Professor of Economics in the Miller School of Enterprise at Ball State College. His column seems in Indiana newspapers.
BLOOMINGTON, Ind. – He wasn’t here long, and he is one of several one-year Indiana wonders who have taken the Hoosiers to unprecedented heights in their 10-win 2024 dream season.
The brief and glorious ride that defensive tackle James Carpenter has been on in an Indiana uniform is close to its final act.
The final game of the regular season for Carpenter and his teammates is Saturday when Indiana hosts Purdue in a 7 p.m. ET kickoff.
It won’t be Indiana’s last game as the postseason beckons, but it might be the last chance for Carpenter to bask in the appreciation of home fans who have grown to love him and some of the other Hoosiers – new and old – who have taken Indiana to a possible College Football Playoff berth.
Carpenter will be out of eligibility after the 2024 season. Other prominent Hoosiers, transfers or not, such as quarterback Kurtis Rourke, running backs Justice Ellison and Ty Son Lawton, wide receivers Myles Price and Ke’Shawn Williams, center Mike Katic, defensive linemen Lanell Carr Jr. and Jacob Mangum-Farrar and safety Josh Sanguinetti, are among the senior-plus players who are nearing their post-college football futures.
For Carpenter, coming to Indiana and being an integral part of the Hoosiers’ 10-1 season has confirmed to him (and many of his transfer teammates) that they made the right choice to try their luck in the Big Ten after playing at a so-called lower level in the Sun Belt Conference.
“It’s really just having a chip on our shoulder. Most of us that have transferred here, we were under-recruited guys who didn’t get recruited by the schools we wanted to coming out of high school,” Carpenter said.
“So I think we’ve always kind of had that chip on our shoulder coming here, We saw a lot of stuff about how we were too small. We weren’t going to be able to play in the Big Ten. We’ve used that as motivation for us” he said.
That fuel has pushed Indiana’s defense to impressive heights. The Hoosiers have the best run defense in the nation, giving up just 76.1 yards per game. Indiana is third in total defense at 261 yards per contest. The Hoosiers also rank third nationally in first downs allowed (167).
Carpenter said that defensive coordinator Bryant Haines keeps things fresh by adding layers to the defensive base principles each week.
“Coach Haines and Coach (Pat) Kuntz (defensive line coach) have definitely added a lot of different stuff. Different fronts, different pass rush schemes, a lot of different blitzes and unique looks,” Carpenter said. “They put a lot on our plate, and we welcome that.”
Carpenter – who has 29 tackles, including five sacks and nine tackles for loss – also cited a good rapport with fellow defensive tackle CJ West, himself a transfer from Kent State.
As they have grown accustomed to one another, Indiana’s run defense and push up front in pass rushing situations have become that much tougher for opponents to handle.
“In camp, we usually build upon the base level stuff. Then, each week, we’re putting in a bunch of new blitzes, different looks,” Carpenter explained. “A bunch of guys have been in the system long enough, we work well together. So they can throw a lot at us, and we’re going to go out there and execute.”
At a minimum, Indiana will have a bowl game after its regular season finale against Purdue. However, Saturday might be the last chance for Carpenter to play at Memorial Stadium, a happy place for him as he’s concluded a college career near the top of mountain after he was barely recruited out of high school in Roanoke, Va.
Curt Cignetti believed in Carpenter. He was one of his first recruits at James Madison and brought him to Indiana, where both men have enjoyed career highs not known before.
Carpenter will walk on the Memorial Stadium turf on Saturday thankful for his time as a Hoosier.
“It’s definitely going to be a little bit of an emotional moment,” Carpenter said. “It’s been an incredible ride. It’s definitely going to hit me when I’m out there with my parents, but I’ll just save that for that moment.”
A moment Carpenter earned by covering himself in glory in his one season in an Indiana uniform.
BLOOMINGTON, Ind. – Indiana’s football rise into the national elite has been such a dizzying, intoxicating ride that it felt like it might never end.
Alas, No. 2 Ohio State dealt the Hoosiers a reality check with a dominant 38-15 victory Saturday at Ohio Stadium.
Most Indiana observers understood that a splash of water in the metaphorical face of Indiana football was likely when the College Football Playoff rankings came out.
Once revealed? It was a pretty cold splash that hit the Hoosiers late Tuesday night.
Indiana (10-1) fell to the No. 10 spot in the rankings. Six one-loss teams (Ohio State, Texas, Penn State, Notre Dame, Miami, SMU) and two two-loss teams (Georgia, Tennessee) are ahead of the Hoosiers. Indiana is rated the worst of the one-loss Power Four conference teams.
Because of the way the College Football Playoff bracket is constructed, Indiana is the last team in the 12-team field. Two teams ranked lower than Indiana would make the field as projected conference champions.
It’s a precarious position for Indiana as its margin for error has been exhausted. Still, there are plenty of happy and heartbreaking outcomes to consider as the college football season gets closer to its pre-Playoff climax.
Here’s a few scenarios to consider after the College Football Playoff committee set the latest pecking order Tuesday.
The best-case scenario
• If Indiana wants to go for the glory? Apart from the obvious win Indiana needs over Purdue, Hoosiers fans can hope for a Michigan win over Ohio State and a Maryland victory at Penn State. That would put Indiana into the Big Ten championship game against Oregon. A win in that game would give Indiana a bye into the College Football Playoff quarterfinals.
However, the risk in that is that if the Hoosiers were to lose, they could be out of the CFP field altogether depending on what happens elsewhere. High reward, but high risk, too.
For Indiana to get back into the playoff hosting picture? The Hoosiers probably need at least two of the following results: Georgia loses at home to Georgia Tech on Friday night, Tennessee loses at Vanderbilt, Miami loses at Syracuse, SMU loses to California at home or Notre Dame loses at Southern California on Saturday.
After the upsets that took place in Week 13? Stranger things have happened.
The most realistic good scenario
• If your best-case scenario is to beat Purdue, but lose the risk of incurring a second loss by missing the Big Ten championship game? It’s as simple as beating the Boilermakers on Saturday night. Given that Indiana are currently 28.5 point favorites, that is a solid probability.
However, Indiana is looking over its shoulder, too. No. 12-ranked Clemson lurks behind the Hoosiers and has a chance at a quality win when the Tigers host rival South Carolina Saturday. Though the Gamecocks are also lurking in the No. 15 spot, it would do Indiana a world of good to have South Carolina get Clemson off Indiana’s rear bumper.
The worst-case scenario
• This is simple: Indiana loses to Purdue. Barring a litany of upsets elsewhere, a loss to the Boilermakers would be a mortal blow to the Hoosiers’ CFP hopes.
Another worst-case scenario would be if Indiana beat Purdue, but Texas A&M beat Texas to make it to the SEC championship game and then pulled a major upset in that contest against Georgia.
That would put the Aggies in the CFP field as a bid-stealer and knock every other team down a notch. If Indiana was still on the bubble, this would cause it to burst.
The most realistic bad scenario
• Indiana beats Purdue, but not convincingly. A two-touchdown win or less is going to reflect poorly on the Hoosiers. Like it or not, style points matter.
If Indiana squeaked by the Boilermakers, in combination with a Clemson win over South Carolina and no upsets in front of them, it would be high time for Hoosiers fans to start to sweat.
Add in an Alabama win over Auburn and/or an Ole Miss victory over Mississippi State? The Hoosiers might survive it all, but the conference championship games and the reveal of final rankings on Dec. 8 would be a white-knuckle experience for Indiana.
The most ambiguous scenario
• Indiana beats Purdue, but once again, not convincingly. However, some of the teams ahead of Indiana also lose.
Any loss by either Georgia or Tennessee would be trouble for either team as it would be their third defeat. SMU has had a great season, but the Mustangs would take a hit if they lost at home to California. Similarly, Miami has just one loss, but the Hurricanes have won their share of close shootouts during the season.
Add in wins by Clemson, Alabama and Ole Miss? Perhaps toss in a Texas A&M victory over Texas that would put the potential bid-stealing Aggies in the SEC championship game? The CFP committee would have one heckuva Gordian knot to untangle going into the conference championship games.
Indiana
Warde Manuel reveals how College Football Playoff committee views outcome of Indiana vs Ohio State
A Top-5 showdown highlighted the Week 13 slate as Indiana and Ohio State squared off at The Horseshoe. Ultimately, the Buckeyes got a blowout victory over the Hoosiers, and all eyes turned toward Tuesday’s College Football Playoff rankings to see how the committee viewed that outcome.
Of course, Indiana wasn’t the only top-ranked team to fall last week. Multiple others did, as well, which likely helped the Hoosiers stay in the Top 10. According to committee chair Warde Manuel, IU has the resume to be the No. 10 team in the country.
Manuel pointed out it wasn’t all bad for Indiana in last week’s matchup. The Hoosiers had some good moments, notably the opening drive. Although they dropped five spots, Manuel said IU still did enough to be in the Top 10.
“We viewed Indiana – they played well at times against Ohio State,” Manuel said on the CFP rankings reveal show on ESPN. “And Ohio State pulled out a victory and really came on in the second half of that game. But we were impressed with some of the things that Indiana did. And they dropped five, but we still felt that their body of work was strong enough to remain in the Top 10.”
Indiana’s strength of schedule was a key point of conversation entering last week’s game. The Hoosiers’ schedule ranked No. 106 in the country through Week 12, according to ESPN, which was the second-weakest of the College Football Playoff Top 25. After the Ohio State game, though, IU’s schedule now ranks No. 51.
Of course, the numbers also back up Indiana’s case to be one of the top teams. The Hoosiers rank No. 9 in the nation in scoring defense and No. 2 in scoring offense. That’s why, after Saturday’s game, Curt Cignetti scoffed at a question about whether they should still be in the 12-team field before answering with a wink and smile.
“Is that a serious question?” Cignetti said in his postgame press conference, with a smirk. “I’m not even gonna answer that one. The answer’s so obvious.”
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