COLUMBIA — While the nation concentrates on the high-profile bank collapses and the recent federal bailout, local legislative candidates are concentrating on the jobs, wages and taxes of their district's constituents. For Missouri, the recent downturn is only the next chapter in the story of the state's struggling economy.
"The trouble Missouri has been experiencing over the last decade dates back to the productivity gain from 1995," said Joseph Haslag, MU professor of economics and the director of the school's Economic and Policy Analysis Research Center. "Productivity growth was faster in the rest of the U.S., and Missouri missed out on that."
Things have not picked up much for the state since those days. "The typical person in the state has gotten poorer," Haslag said.
According to the Missouri Economic Research and Information Center, the state's unemployment rate has increased at the same rate as the rest of the country — 1.6 percent — over the past two years. Locally, Boone and Randolph counties' unemployment rates have been growing at a pace slightly slower than the national average, but the unemployment rates in both Audrain and Monroe counties have increased 2 percent since 2006.
In terms of wages, Missouri is falling behind the national average. In 2007, per capita personal income increased for Missourians 4.9 percent, as compared to the national growth rate of 5.2 percent. The state ranked 20th in total personal income in 2007. Here's what candidates for local legislative offices have to say about the economy.
19th District state senate seat
Republican Kurt Schaefer said he's actually encouraged by some aspects of Missouri's economy that suggest to him that it remains fiscally stronger than other parts of the country. He favors more regulation to prevent the economic conditions that have affected the rest of the country from taking root here.
"I favor more regulation on some of those more questionable lending practices," Schaefer said, citing a case where he helped citizens sue Chase Manhattan Bank for fraud. "More aspects of fraudulent lending practices need to be looked at."
Schaefer also favors giving incentives to businesses in the form of tax credits.
"One difference between myself and Chuck Graham is that I favor tax credits for businesses who invest capital in Missouri," Schaefer said. "We aren't just losing jobs to China and India, we are losing them to Kansas and Indiana, who have better economic incentives."
Incumbent Chuck Graham, D-Columbia, said economic growth will "cluster around areas of higher education." He said he would encourage economic growth by investing in higher education, a move that he said also would give college graduates more money to spend.
"The more you invest in higher education and scholarships to make sure students can get an education, the better you are going to be," Graham said. "Students get out of here with a paycheck that doesn't just go to a student loan, so they can buy a car or purchase a home, and that's the way we are going to restore the economy."
Libertarian Chris Dwyer said one way to stimulate the economy is to move to the "fair tax," or consumption tax, on goods. He says he opposes tax credits for businesses because they are unfair and unequal and don't encourage growth.
"There's a hidden tax in everything; if you remove that and go to a consumption tax it makes your goods overseas more affordable, and that will help those people who deal with products overseas," Dwyer said.
21st District House seat
Kelly Schultz, D-Shaw, emphasized the importance of creating jobs that help Missouri businesses. She said one of the things that differentiates her from Republican incumbent Steve Hobbs is her opposition to providing tax credits to large corporations, such as in the Bombardier tax credits that ultimately failed to entice the airplane manufacturer to Missouri earlier this year. Schultz said she views a dollar used for a tax subsidy as a dollar taken away from general revenue for statewide improvements.
"I'd rather that money be spent to help small businesses expand and provide health insurance," she said. "It could be used across Missouri, not just in Kansas City."
Schultz also said that large profitable corporations should not receive tax credits if they don't provide health care to employees.
Hobbs said a strong economy starts with keeping taxes low and a regulatory climate favorable to businesses. Hobbs noted that the Bombardier tax credits approved earlier this year, though unsuccessful, would cast the state as friendly for other manufacturers. Other companies, such as Boeing, have shown some interest in moving operations to the state.
"That deal, while it did not happen, will pay dividends," Hobbs said.
Hobbs said he thinks the key to creating new jobs in Missouri ultimately lies outside manufacturing. A recent announcement of the creation of a new plant science research center in Mexico, Mo., made possible though special funding for university capital improvements is the model to emulate, he said.
"It's the biggest thing to hit Mexico since the fire brick plant," Hobbs said. "We're changing the base of the economy ... to a technology-based job force. I don't think anyone thinks manufacturing jobs are going to come back from Third World countries."
24th District House seat
The economy takes priority for incumbent Ed Robb, R-Columbia. The 66-year-old economist and budget aficionado thinks that in order to bolster Missouri's struggling economy, the state needs to become more business friendly.
Robb is quick to point out that Missouri's union-shop status scares off future businesses and stymies companies already operating in Missouri. Robb would support legislation that would turn Missouri into a "right-to-work" state, legislation that would let individual workers decide if they want to join a union.
"We compete for business with states contiguous to us," Robb said. "We have to worry about Kansas, Nebraska, Oklahoma and Iowa. ... They all have right-to-work legislation."
Robb said he thinks that reducing or even repealing corporate income taxes could right Missouri in the economic long run.
"By making taxes lower for corporations, we can make Missouri as business friendly as possible," Robb said. "If we get rid of the corporate income tax, we could get rid of some of the tax credits companies currently receive. ... We're talking four to five hundred million dollars of tax credits a year."
Chris Kelly, D-Columbia, is opposed to tax cuts that he sees as irresponsible and a state-sanctioned slight against labor unions. He also doubts that his opponent is serious about such positions.
"The Republicans and (Ed Robb) had both the state House, the Senate and the governor ... but they didn't make a serious effort to do any of those things," Kelly said. "They want to talk about these issues every time it's an election year, but they didn't touch (them)."
Kelly said he thinks that the local economy would greatly benefit by making the intersection at state Route H and U.S. 63 safer for development and also by supporting the development of the new nuclear power plant in Callaway.
"The plant can provide more energy in the long run," Kelly said. "What we need to do is use (a second power plant) as a vehicle for investing in more alternative sources of energy in Missouri, like solar or wind."
25th District House seat
Democrat Mary Still said the key to turning Columbia's economy around is to attract and keep young professionals in the area.
"If (local companies) have jobs to be filled — and they do — we need to make certain we have some system in play between the university and (local) industry," she said.
Still cited ABC Laboratories and Socket as two local companies that are interested in hiring professionals.
"We need people to understand that there are jobs right here in town that they can qualify for," Still said.
She added that to keep those professionals here, Columbia must show that it is a city that seeks and welcomes diversity, where citizens enjoy a high quality of life.
In terms of taxes, Still said that she would like to see a good cost-benefit analysis of Missouri tax credits to evaluate which are most effective.
"If there are beneficial credits available to other communities, I'd certainly want to see if we could use them to the benefit of Columbia," she said.
Republican Ryan Asbridge is out of the country on deployment with U.S. Naval Intelligence. His campaign declined to speak on his behalf.
Missourian reporters Spencer Willems, Jenn Herseim and Chris Dieterich contributed to this report.