Wisconsin’s Economic Performance and Outlook are Grim

The good folks at Econobrowser were kind enough to provide some updated analysis of Wisconsin’s economy.  It’s extremely bleak.

Walker cannot hide from these data.  His policies have devastated the Badger State.  Here’s a summary of their findings:

  • Total nonfarm employment continues to decline.
  • Contrary to predictions from October’s Wisconsin Economic Outlook, private nonfarm employment continues to decline.
  • Local government employment is down by 4700 relative to January 2011, and continues to plummet.
  • With the exception of Indiana, no other state in the Fed’s 7th district besides Wisconsin has experienced a sustained decline in its coincident index.
  • Looking forward, Wisconsin’s leading indicator continues to signal contraction.
It’s simply not working, Governor Walker.  At all.  There are a set of charts to back-up these conclusions, but there’s one that really drives home how poorly Wisconsin is doing under Governor Walker’s failing policies compared with the rest of America.
Leading indices, for Wisconsin (blue) and for US (red), 2007M01-2011M10. NBER defined recession dates shaded gray. Vertical line at 2011M01. Source: Federal Reserve Bank of Philadelphia and author’s calculations.

The economy started to tank immediately upon Walker taking office.  Since Governor Walker’s policies are extremely contractionary, this chart and these results shouldn’t be surprising.  Contractionary fiscal policies result in contraction.  You’d think that fact would be obvious.  But I know that Walker and the other “Free Market” fundamentalists insist that cutting leads to growth, reality is imposing itself on their fantasyland.  To believe that any other outcome was possible is to believe in magic, not reality.

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2 thoughts on “Wisconsin’s Economic Performance and Outlook are Grim

  1. Good find, Phil. I had Menzie Chinn for a class in grad school at UW, and he’s a good one. Well worth the read/.

  2. My conservative friends would drive me NUTS blaming Obama for the poor state of the economy immediately after his inauguration, some going so far as place fault for pre-election conditions squarely on the president’s shoulders. I’d make the standard retort that current conditions are a result of past actions, and current actions cannot be judged until some future time. For the sake of convenience, I set an 6-month time frame, before which I’d refuse to entertain such arguments.

    Well I like to consider myself a fair person, so of course I’d extend a similar benefit of the doubt to our governor. Well, time’s up and Mr. Walker now owns those charts. It’s difficult to explain away those state conditions in light of the national trend.

    Of course the 6-month period is completely arbitrary; economic and social conditions are a factor of numerous complicated causes working on various time schedules, some lags being rather brief, some very long. For example, we might not expect a completely reworked educational system to show its impact until the youngest students have worked their way through the system in 12 or 14 years. But too often in the political blame game, like so many other areas of life, we like our gratification immediate.

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