Friday, June 17, 2011

School job cuts raise unemployment rate; Haley promotes Boeing

There's been no word from Governor Nikki Haley's office yet on South Carolina's new unemployment rate, which has now crept back into double digits. The Post & Courier of Charleston reports that the governor and other of the state's leading lights are in that area today to participate in a Congressional hearing on the Boeing controversy. Various Congressmen are convening a hearing on the National Labor Relations Board complaint against the corporate giant for moving union jobs to a right-to-work-for-less state.

But the Post & Courier did report on the jobless rate in today's edition.

The jobless figure rose to 10 percent for May from 9.8 percent in April, the state Department of Employment and Workforce said today.

Statewide, job decreases were reported in three sectors: education and health services; government; and professional and business services.

Does the decrease in education jobs mean that there are fewer children in South Carolina in need of education? Not according to the 2010 census, which said that South Carolina has increased in population so much that we deserve another whole Congressional district. So why is there such a drop in education jobs?


I can tell you what the General Assembly is doing about it:

Lawmakers struck an agreement Thursday on a $6 billion spending plan for the state, including cutting by a quarter the unemployment tax bills paid by businesses. The tax cut for employers comes at the expense of public schools.
Among the final issues to resolve was how to use $210 million that state economists added to the state's projected revenues last month.

The Senate split the money almost evenly between K-12 education and tax relief for businesses. Those businesses are having to pay higher unemployment insurance rates to repay nearly $1 billion in federal loans that the state was forced to take out in order to continue to pay unemployment benefits during the recession.

The House set aside $146 million for businesses and $56 million for schools, arguing that cutting the employer cost of unemployment insurance might encourage companies to hire more quickly.

Gov. Nikki Haley weighed in, too, Wednesday, threatening to veto the Senate's version of the budget, which gave more money to K-12 education than the House did. Haley said any money added to the state's projected revenues, after the House finished its budget plan in March, should go to cut taxes, pay off state debt or be returned to taxpayers.

Haley said Thursday that while education is a core function of government, the state's K-12 budget should grow no faster than the rates of inflation plus student growth.
Business leaders were happy with the choice.

As well they should be; those who need the least aid from state government got the most, and those who need the most aid got the least. Translate that into Latin, and it sounds like South Carolina's state motto: Dum spiro spero.

Here's a bold idea for a passionate young lawmaker to propose on behalf of South Carolina's children: Lower the state's minimum voting age to nine. Then let's watch how the education budget in South Carolina starts to gain a little traction among legislative priorities.

Jim Davenport of the Associated Press offers a little more detail to the picture.

For weeks, the biggest issue in the spending plan had been $210 million in unexpected taxpayer collections.

The Senate version of the bill used $105 million to increase public school spending and $100 million on the business tax break.

The $105 million would have raised state per-student spending to $1,959 from the current $1,617. It's still well short of the $2,720 a state school funding formula says is required and it raised per-student spending to roughly where it was in 2000.

Imagine that. By adopting the Senate's proposal, South Carolina's legislature would have raised the state's per-pupil expenditure back the level it was in the last year of Bill Clinton's presidency.

But, no.

Instead, schools will get $56 million, raising the per-student spending to $1,880.

The tax break came after businesses complained about soaring unemployment tax rates needed to cover nearly $1 billion in federal loans. The loans were needed after the state's unemployment trust fund went broke in 2009, depleted by years of too-low tax collections that left it unprepared for the recession's layoffs and firings.

To cover the loans, the Republican-controlled Legislature approved what's regarded as one of the biggest business tax increases on record and insisted that employers with the records of firing people pay more.

The House put $146 million into that tax break, knocking about 25 percent off unemployment tax bills for companies with firing records.

"I think that will help our businesses around the state," said Senate Majority Leader Harvey Peeler, R-Gaffney.

As for helping South Carolina's children get a 1990s-era quality of education, it'll have to wait another year.

And we wonder why South Carolina continues to lag decades behind the rest of the nation.

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