Recently, the liberals in Colorado have been up in arms over the study by Dr. Eric Fruits of Portland State University that shows, if passed, Prop 103 could kill up to 119,700 jobs in Colorado, claiming "fuzzy" math was used to derive that number. Of course they need to push back, and hard, because it's a devastating line of attack that is nearly impossible to beat. In this economy, people are not willing to vote to reduce employment levels any further.
While we appreciate the snarky posts over at ColoradoPols (Zombies! Balloon Boy!), they are purposely obfuscating the point. The number 119,700 wasn't picked out of thin air. Here's why:
The Huffington Post, back in June, clarified the disagreement over the number used to describe the potential job losses/lowered employment level found in Dr. Fruits' study on Prop 103.
Ultimately it comes down to simple math: should employment differences compound yearly? In which case, if a job is not created in one year, five years later it counts as five missed job-years; or should each year be treated as a separate instance–so that, after five years, one non-job still counts as one?
Using the study’s cumulative job-year number is appropriate for three simple reasons:
1. It's an accepted practice when describing job creation/loss studies. Liberals for years have compounded "green" job gains in studies they have produced, including here in Colorado, without nary a wimper from the liberal set. They do this when it suits their needs, but dispute it when it doesn't align with their policy priorities. It's politics — is anyone surprised?
Last year, liberals in the Legislature touted a study by Environment Colorado and Vote Solar entitled "Investing In The Sun" that purported to show that HB-1001, a bill to subsidize green energy, would create 23,450 jobs. When you look at the report it has a footnote saying that it's actually 23,450 job-years, not total permanent jobs.
How did ColoradoPols' sister site, the Colorado "Independent," report on it?
A report released ahead of state Senate debate on a bill that would up Colorado's renewable energy standard (RES) to 30 percent by 2020 finds that HB 1001 would generate 23,450 jobs over the next decade.
What about the Denver Business Journal?
Environmental advocates supporting a bill in the state Legislature that would require Xcel Energy to get 30 percent of its power from renewable sources released a report Tuesday saying the higher mandate could create 23,000 jobs in the state's solar industry over the next 10 years.
Guess who trumpeted this report and used the compounded number?
The Senate Democrat Caucus, Governor Bill Ritter's Energy Office (PDF – p 10), and the bill's sponsor Sen. Gail Schwartz (D-Snowmass).
In fact, all of them used the number 33,325, which is completely disingenuous. That number of job-years is only created if HB 1001 does something it does not do — extend the legislation beyond Xcel and Black Hills. That means they were attaching a bigger job gain to their legislation than even a cumulative total would allow for.
Funny, we couldn't find a post on Coloradopols attacking that.
If it's fair game for the greenies, then it should be considered fair game for those opposed to raising taxes in a recession.
2. Two years of reduced employment is different than one. The study finds not actual specific jobs lost, but rather a lowered employment level overall. Looking at the chart to the left, the red line represents Legislative Council Staff's expected job growth, without the Prop 103 tax increase. The blue line represents what Dr. Fruits found would happen should Prop 103 pass. To appreciate the economic harm Prop 103 would cause it’s important to look at the total area in between, rather than just the gap between the red and blue lines in 2017.
To put it another way, in bending the employment level line down, there is more to the job loss numbers than the last year of reduced employment.
Just ask anyone who has been unemployed for more than a year. Would they say that being out of work for two years is the same thing as being out of work for one?
There is a demonstrable difference between the two that needs to be highlighted.
3. This is for raising revenue, but there will be 119,700 less taxpayers. This is key to the study as well, but it has gone virtually unmentioned by those attacking it.
If employment is reduced by 5,500 in the first year, as Dr. Fruits found would happen, that means there will be 5,500 less employed taxpayers generating revenue for the government. By year two that is expected to increase to 14,300, and therefore there are 14,300 less employed taxpayers generating revenue for the government. But between the two years, there were actually 19,800 less tax returns coming in from employed people.
Since the study does not make claims about what types of jobs would be lost, it's impossible to say exactly how much taxable income that would decimate, but suffice it to say 119,700 less tax returns coming in would have a deleterious effect on government revenue. This is important because it will reduce the same government revenue that Proposition 103 is attempting to generate.
These three reasons make it pretty clear the number 119,700 jobs lost wasn’t made up “out of thin air,” regardless of how much Prop 103 proponents would like to believe so.
It is also clear there is more than one way to report on predicted employment effect studies. Both cumulative and last year annual loss figures have been bandied about before. Reporters should feel free to use either one.
Ultimately, the only study out there on Prop 103 shows substantial and painful job losses for the people of Colorado. Any mention of job losses will help ensure Prop 103's defeat, which is the real reason liberals have been hyperventilating over the reporting of the study.
Guess we won't have to worry about Wolverines or a zombie Ben "Nighthorse" Campbell eating our brains after all.
Phew!