Mississippi is one of two states that economically shrank in 2014 (Jackson: real estate, 2015)

[Neshomamench]

Miss. 1 of 2 state economies to shrink in 2014


...and they showcase a guy who says the solution is more government programs.

Mississippi, you are doing it wrong. Good luck, you're going to need it.

[circledmetalart]

As I travel a bit around the country, I find this information surprising. If you were to use the same formulas for other states as you have in MS I just can't believe there are not declines in many other places. I think MS is singled out repeatedly for negative press, as always.

[sammyreynolds1977]

Originally Posted by circledmetalart

As I travel a bit around the country, I find this information surprising. If you were to use the same formulas for other states as you have in MS I just can't believe there are not declines in many other places. I think MS is singled out repeatedly for negative press, as always.

Then you need to think again.

[Neshomamench]

Originally Posted by circledmetalart

As I travel a bit around the country, I find this information surprising. If you were to use the same formulas for other states as you have in MS I just can't believe there are not declines in many other places. I think MS is singled out repeatedly for negative press, as always.

That is part of the problem, people dont even believe it. You certainly cant get people to act if they dont even believe it.

[viverlibre]

This shouldn't be surprising. I love MS, but am a realist, the future isn't bright for the state. We are a poor, rural, sparsely populated state and lead in most of the negative categories.

Decent jobs for low skilled workers are few and jar between and unfortunately we are chocked full of low skilled workers.

[Neshomamench]

Originally Posted by viverlibre

This shouldn't be surprising. I love MS, but am a realist, the future isn't bright for the state. We are a poor, rural, sparsely populated state and lead in most of the negative categories.

Decent jobs for low skilled workers are few and jar between and unfortunately we are chocked full of low skilled workers.

That is indeed the reality.

What makes it worse is the people who are hurt most by it the most (the states poor whites and minorities) are not interested in doing most of the right things to fix the problem, like getting educated and stop blaming other people for your own problems.

Mississippi could really take off with manufacturing. There are a lot of people here who could do that for cheap and you dont need much of an education to do that but people wont get off the government dole and drugs to step up to that life.

Someplace has to be "the worse" and Mississippi is it. It does not have to be but as the poorest state, that means all those poor people are the ones that have to act and so far, they are not.

[CoolZombie]

Mississippi needs to cut out the nutty religious right politics. Liberal high tech companies would love to move somewhere warm and cheaper than California but it ain't gonna happen when you thump Bibles to scare them off. Look at how all the most prosperous areas of the South are liberal (Raleigh Triangle, NOVA, Atlanta)

[Jardine8]

Originally Posted by CoolZombie

Mississippi needs to cut out the nutty religious right politics. Liberal high tech companies would love to move somewhere warm and cheaper than California but it ain't gonna happen when you thump Bibles to scare them off. Look at how all the most prosperous areas of the South are liberal (Raleigh Triangle, NOVA, Atlanta)

I don't think religous conservatives scare people or companies off. I think it is more of an issue of education (ie we don't have a lot of skilled workers to attract industry) and leadership (ie we need quality leadership that can attract large employers that need skilled labor).

[Neshomamench]

Originally Posted by CoolZombie

Mississippi needs to cut out the nutty religious right politics. Liberal high tech companies would love to move somewhere warm and cheaper than California but it ain't gonna happen when you thump Bibles to scare them off. Look at how all the most prosperous areas of the South are liberal (Raleigh Triangle, NOVA, Atlanta)

All of Utah is far more religious and very exclusionary and they are doing fine. There are plenty of success stories in the rest of the bible belt as well.

You are blaming the wrong things. An uneducated workforce with no hope or worse, desire of becoming educated. Real and perceived crime problems. The fact that people who do try to come here hate it and leave.There are plenty of other problems but Jesus isnt causing those problems.

[brickpatio]

I looked up the GDP growth by metro area for 2013 (not yet available for 2014) and noticed the dismal performance by places such as Birmingham, Chattanooga, Memphis and others in the southeastern region. This made me wonder what would separate southern metro areas. Two things come to mind.

Oil and gas has been the one growing sector in the economy in recent years due to the discovery of massive new resources through fracking. The other source of growth has been in the stock market, due to the federal government offering below 0% (after inflation) interest rates, i.e. they are paying people to borrow money, which has the indirect effect of boosting the stock market as people take the free money from the feds and bid up commodities such as bonds, energy, real estate etc..

Based on those things, my guess is that the states that are doing best are those with oil and gas...and states with a higher percentage of households that own stock. In contrast, states that rely heavily on manufacturing and other normal segments of the economy outside energy and commodities, are stuck in the mud. Making things worse, apparently agricultural prices have been falling through the floor, after banner years several years ago, which has hurt agricultural states such as Mississippi as well as breadbasket states like say Kansas.

One other thing I noticed is that a major source of growth in Mississippi has been in DeSoto County (i.e. about half the state's population growth I believe), and based on the federal data Memphis metro area has been growing even more slowly than Jackson. As a result DeSoto's growth has temporarily slowed down (also due to the federal government's collapsing on the housing market in 2008 etc), and this has taken a sizable bite out of the state's overall growth rate subsequently.

One other theory is that the governor in Mississippi has been very focused on improving the state's finances and balance sheet, (which is fine but only as means to an end) but so far has not taken the next step of reducing the income tax rates. The purpose of restoring the health of the state's finances is to free up the state to cut income tax rates without over-burdening the state in new debt over the short term. If the state has been managing its money well, it should be able to cut tax rates and take on some new debt without getting into trouble.

But so far, the current governor has failed to pass major cuts in income tax rates, which is by far the main way to trigger new investment and economic growth by the state's investors, corporations and entrepreneurs. The legislature this year I believe actually tried to eliminate the state's 5% income tax altogether, but apparently the governor and the state senate were not as brave as the house of representatives, and ultimately the proposal failed.

If you think about it, Mississippi's 3 million people are competing with over 50 million people in Texas, Florida, and Tennessee whose businesses are burdened with essentially zero income taxes. And I read North Carolina passed big income tax cuts this year, furthering their competitive advantage.

Based on all this, my guess is that what needs to happen in Mississippi is:

- Legislature must eliminate the 5% income tax, to level the playing field for Mississippi's businesses with those in Texas, Florida and Tennessee (among others).

All they have to do is spread the cuts over say 20 years (dropping .1% per year, i.e. from 5% to 4.9% to 4.8% to 4.7%, i..e. each year...), to reduce the risk of added short term debt. Require the legislature to accelerate the cuts in years where state coffers rise faster than projected beyond a certain point, which likely means the elimination of the 5% income tax would occur in perhaps 10 to 15 years rather than 20.

- If a tax cutting president is elected in 2016 to replace Obama, that will give investors and corporations nationally the green light to begin growing and expanding again, including in Mississippi. As a result, growth will no longer only be in the energy sector and in areas related to stock market growth, but now in places like Mississippi where growth is tied to manufacturing and other normal parts of the economy.

- Over the long term, obviously Mississippi's citizens would become dramatically better educated if every child were given a scholarship to a private or parochial school, which usually cost the same or less than government-owned schools. Perhaps the governor could make this happen faster incrementally by selecting a handful of counties at a time to privatize their schools.