Monday Report
Public Official Corruption December 22nd - 2008

GOOD YULE

Utah Economic Snapshot

Economic Notes:


 

SCORECARD

Public Official Corruption

    Number of Guilty Officials

    In a Department of Justice tally covering the last decade, Florida wins by its sheer number of guilty. The report, released last week, itemizes convictions in federal public corruption cases at local, state and federal levels in the 50 states, the District of Columbia and three United States territories.

    Illinois ranks only seventh, with 502 convictions. At the squeaky-clean end of the scale, Nebraska barely managed an average of about one guilty official per year.

    Number of Guilty Officials

    Top Ten
    1. Florida - 824
    2. New York - 704
    3. Texas - 565
    4. Pennsylvania - 555
    5. California - 547
    6. Ohio - 547
    7. Illinois - 502
    8. New Jersey - 418
    9. District of Columbia - 380
    10. Louisiana - 332

    Bottom Ten

    • 43. Idaho - 38
    • 43. Kansas - 38
    • 43. Utah - 38
    • 46. Oregon - 36
    • 47. Iowa - 35
    • 48. New Mexico - 30
    • 49. Rhode Island - 26
    • 50. Maine - 25
    • 51. New Hampshire - 14
    • 51. Wyoming - 14
    • 53. Vermont - 25
    • 54. Nebraska - 12

    But the bigger the state, generally, the more officials it has, criminal or otherwise. So places like Florida, New York and Texas pile up big numbers. Let's adjust the data for population.

    A better measure, perhaps, showing how many convicted officials are produced for every one million constituents. Seems fair - unless you're North Dakota.

    The District of Columbia wins big, for obvious reasons: its high concentration of public officials amid a relatively small population. Also, the local United States attorney's office focuses on rooting out corruption, adding to conviction rates. USA Today published a similar list last week, declaring North Dakota the most corrupt state. Statewide outrage followed. (The newspaper omitted the District and the United States territories.) Mike Jacobs, the editor and publisher of the Grand Forks Herald, called it "a stunning and incomprehensible result" and could recall few cases of public misdeeds over his four decades in North Dakota journalism. (One that sprang into his mind: the head of a state office who was accused of shoplifting peanuts in a grocery store. The charges were dropped. That was in 1981.)

    So what's going on out on the Prairie? Two large cases of embezzlement by local officials ran up the conviction numbers, plus a smattering of mostly small- bore crime. Selling a Senate seat? Not yet.

    Meanwhile, Nebraska continues to shine as a beacon of good government.

    # Guilty Officials, per Capita

    Top Ten

    1. District of Columbia - 66.9
    2. Virgin Islands - 46.9
    3. Guam - 40.5
    4. North Dakota - 8.0
    5. Louisiana - 7.5
    6. Mississippi - 7.4
    7. Montana - 6.4
    8. Kentucky - 5.9
    9. Alaska - 5.6

    Bottom Ten

    • 45. Washington - 1.6
    • 46. New Mexico - 1.6 47. Utah - 1.6
    • 48. California - 1.6
    • 49. Kansas - 1.4
    • 50. Minnesota - 1.3
    • 51. Iowa - 1.2
    • 52. New Hampshire - 1.1
    • 53. Oregon - 1.0
    • 54. Nebraska - 0.7

    Researchers asked state house reporters to assess their subjects and ranked responses on a scale of 1 (clean) to 7 (crooked) in a 2003 study. Nebraska? Good, not great. For North Dakota, sweet vindication: it tied with South Dakota and Colorado for least corrupt.

    Survey of Journalists - Reporters Scores

    Top Ten

    1. Rhode Island - 5.500
    2. Louisiana - 5.400
    3. Virgin Islands - 5.333
    4. Oklahoma - 5.000
    5. Delaware - 5.000
    6. Alabama - 4.909
    7. Kentucky - 4.857
    8. Arizona - 4.714
    9. West Virginia - 4.714
    10. Illinois - 4.667
    11. Ohio - 4.667

    #14 Utah - 4.333 Bottom Ten

    • 38. Kansas - 2.429
    • 39. Iowa - 2.250
    • 40. Montana - 2.143
    • 41. Minnesota - 2.000
    • 41. Vermont - 2.000
    • 41. Oregon - 2.000
    • 44. Main - 1.667
    • 45. Colorado - 1.500
    • 45. South Dakota - 1.500
    • 45. North Dakota - 1.500

    Source: State Politics and Policy Quarterly, The New York Times Company, December 2008


More Developers Abandon Hotel Projects

In a fresh sign of weakness in the hotel sector, the number of guest rooms abandoned in the construction pipeline rose 75% in November, compared with the same period a year ago, according to Smith Travel Research. A hotel project is deemed abandoned when a developer or banker responsible for a project decides not to pursue it any further.

In November, 93,219 hotel rooms were abandoned in various stages of the pipeline, from early or final planning to construction. However, it is rare to abandon rooms once construction has begun, says Jan Freitag, a vice president with Hendersonville, Tenn.- based Smith Travel Research.

"Given the current state of the economy and the non-existence of new construction lending, these numbers aren't surprising," says Freitag. "We believe that we will continue to see this high level of abandonment through at least the first half of 2009. Until funding for new and existing projects is made available by lenders, there is little reason to believe that the rate of abandonment will slow."

Source: NREI 12/17/08


Greetings!

Public Offical Corruption

Where Does Utah rank?

Is it past time to demand real reform?

Sent early because of the holadays.

Good Yule,

Bob and Jon Springmeyer

Bonneville Research


  • Utah Economic Snapshot
  • Utah Labor Market Indicators - November (October) 2008

    • Employment Growth: -0.9% (-0.2%)
    • Employment Decrease: -14,409
    • Unemployment Rate:
      • November 3.7%
      • October 3.5%
      • September 3.5%
      • August 3.7%
      • July 3.5%
      • June 3.3%
      • May 3.2%
      • April 3.1%
      • March 3.3%
      • February 3.0%
      • January 2008 3.0%
      • December 2007 2.9%
      • November2007 2.8%

    Source: Utah Dept of Workforce Services, 12/17/08


    Employment Trends Top 15 Markets YTD October 2008

    RankMarketYTD Abs. ChangeYTD % Change
    1San Antonio14,6261.7%
    2Houston44,1401.7%
    3Dallas-Fort Worth45,4671.5%
    4Austin11,713 1.5%
    5Oklahoma City6,4331.1%
    6Washington D.C.30,8341.0%
    7Charlotte5,4670.6%
    8Boston13,7090.6%
    9San Jose2,9070.3%
    10Columbus2,8120.3%
    11New Haven-Fairfield County2,0850.3%
    12Baltimore3,2000.2%
    13Denver2,3900.2%
    14Indianapolis1,660 0.2%
    15New York8,2560.2%
    United States- 1,378,000-1.0%
    Utah-14,409(Nov) -0.9%

    Source: Marcus & Millichap Research Services, BLS. 12/16/08


    Utah Economic Snapshot - First Five Months FY2009 YTD

    Utah State Government (Four Months)

    • Sales and Use Taxes (Gen Gov't, Higher Education) -7.3% (-8.6%)
    • Individual Income Taxes (Public Education) -15.8% (-12.6%)
    • Corporate Franchise Taxes (Gen Gov't) +1.6% (+10.6%)
    • Motor Fuel Taxes (Transportation) -15.4% (-11.4%)
    • Severance Taxes (Gen Gov't) +111.5% (+95.8%)

      Local Government

    • Sales and Use Taxes (includes food) -5.6% (- 4.4%)
    • Transient Room Tax -12.4% (-4.6%)
    • Tourism, Recreation, Cultural, Convention -4.8% (+4.0%)
    • Municipal Telecommunications License -13.9% (-18.7%)
    • Emergency Services Phone Charge -11.6% (- 14.9%)
    • Public Transit (-9.6%-4.8%)

      Summary

    • Public Education -$140,366,559/ -13.0%
    • Transportation -$41,866,408/ -11.8%
    • General Fund -$6,020,543/ -0.7%

    Source: Utah State Tax Commission, TC-23 12/16/08


  • Economic Notes:
    • International Business Confidence
    • Global business confidence continues to slide, falling to another new record low last week. Sentiment is equally negative in North America, South America and Europe, and while Asian business confidence is not quite as dark, it is weakening rapidly. Hiring intentions plunged last week and are consistent with job losses of close to 500,000 per month in the U.S. Pricing pressures also collapsed, falling back to where they were in 2003, the last time deflation was a real concern. The entire global economy is mired in recession according to the business confidence survey results.
    • International Shipping Rates Recover
    • One of the world's key shipping markets has begun to recover from a slump, with a revival in Chinese demand for iron ore and coal pushing some average charter prices up almost threefold in the past week. The revival in prices, after a disastrous six months for the industry in which charter rates fell nearly 99 per cent for the largest vessels, could encourage shipowners to bring mothballed vessels back into service.
    • Treasury International Capital Flows
    • Reflecting the unprecedented crisis in international financial markets, the October TIC data are quite grim as they indicate much diminished foreign appetite for U.S. financial assets. Net foreign purchases of U.S. long-term securities in October dropped to only $1.5 billion from $65.4 billion the prior month. This is of course not enough to finance the monthly U.S. trade deficit that has been in the $56.5 to $58.8 billion range over the past three months. However, one dismal month does not a pattern make; we'll need to monitor future TIC flows to see if there has been a significant change in underlying trends.
    • Current Account
    • The U.S. current account deficit narrowed by 3.8% to $174.1 billion in the third quarter of 2008, narrower than the revised $180.9 billion second quarter deficit. The consensus expected the deficit to narrow to $178.8 billion. The deficit on goods narrowed to $214.7 billion, while the surplus on services widened to $38.2 billion.
    • Consumer Price Index
    • The consumer price index decreased 1.7% in November, exceeding expectations for a milder decline. The core index was unchanged over the month. Price declines were led by energy, but inflation broadly is moderating. With the U.S. in recession, this will be a significant weight on price growth for the near term
    • FOMC Monetary Policy
    • The Federal Open Market Committee lowered the fed funds target rate to a range from 0% to 0.25%; it was previously 1%. The fed funds rate is now at its lowest level ever. The committee's statement said that the "outlook for economic activity has weakened further" from the FOMC's previous meeting in late October. The statement says that the "Federal Reserve will employ all available tools to promote the resumption of sustainable economic growth and to preserve price stability." The statement implies that the fed funds target rate will remain in that range for the time being. It also discusses specific actions that would move the Fed further toward quantitative easing.
    • Industrial Production
    • Industrial production fell 0.6% in November and manufacturing output fell 1.4%. Manufacturing received some support from the end of the Boeing strike, but continued weakness in housing and consumer-sensitive categories continued to dampen output. Manufacturing production is on track to fall close to 10% at an annual rate this quarter, considerably worse than the reading in the third quarter and the weakest performance since the early 1980s.
    • Bankruptcy Filings
    • With the recession in full swing, both business and personal bankruptcy filings grew rapidly in the third quarter. The number of personal filing remains low, however, still curtailed by reforms enacted in late 2005. Filings were 33% above last year, but remained more than 25% below the third quarter of 2004, before reform legislation and in a better credit environment. Business bankruptcies are high by any measure, with filings up 61% from last year and 52% over the past four years.
    • New Residential Construction (C20)
    • Conditions are bleak for homebuilders. Residential construction plunged again in November, with a nearly 19% m/m decline in total housing starts. At 625,000 annualized units, starts have descended to an unprecedented post-World War II low. Further, the Census Bureau revised downward October starts by 3%. Permit issuance was down sharply as well in November compared with October. Exceptionally weak demand for new homes is constraining homebuilding. Although this situation is difficult for homebuilders' bottom line, the reduction in residential construction will help clear the market of excess inventories.
    • NAHB Housing Market Index
    • The NAHB housing market index held steady in December, but remains at a record low. The housing market index stands at 9, the same as last month. Likewise, the traffic of prospective buyers remains unchanged at 7. However, both present single-family sales and expected single-family sales over the next six months fell. Present sales fell from 9 to 8, while expected sales fell from 18 to 16. Declines across all these indices have abated, suggesting that builders are soon expecting a bottom to the housing market.
    • MBA Mortgage Applications Survey
    • In the week ending December 12, the MBA composite market index increased 2.9% to close the week at 841.4. The increase in the refinance index was larger, gaining 6.5% to end at 4,156.0. The purchase index decreased 4.5% to 286.1. Both the market and refinance index are above year-ago levels.
    • Chain Store Sales
    • Chain store sales rose 0.6% in the week ending December 13. However, that did not match last year's growth, as sales were 0.4% below last year after two weeks of positive year-ago growth. The ICSC noted that consumers again appear to be delaying holiday shopping until late in the season.
    • Oil and Gas Inventories
    • Crude oil inventories rose by 500,000 barrels during the week ending December 12, according to the Energy Information Administration, in line with expectations. Gasoline inventories rose by 1.3 million barrels, also consistent with expectations. Distillate supplies rose by 2.9 million barrels, beating expectations of a 1.5 million barrel decline. Refinery operating capacity plummeted to 84.1% from 87.4%. Total domestic petroleum demand soared. This report points to higher oil prices.

  • BONNEVILLE RESEARCH - Working with clients to make things happen!
  • BONNEVILLE RESEARCH

    Bonneville Research is a Utah-based consulting firm providing economic, financial, market and policy research to public and private sector clients throughout the intermountain west.

    Helping Clients Succeed

    Our services include:

    • Financial Analysis
    • Business License Studies
    • Impact Fee analysis
    • Urban Renewal & Redevelopment Analysis and Budgets
    • Strategy and Policy Analysis
    • Economic and Fiscal Impact Analysis
    • Statistical and Survey Research
    • Public Sector Mission Effectiveness

    Each of our studies is tailored to address the unique needs of our clients and their communities.


    Successful client work requires a superior team of outstanding people working fluidly together.

    Bonneville Research is the one firm with the experience and expertise to help businesses, governments and nonprofit organizations solve their toughest problems.

    We work to help clients achieve enduring results and improve the communities in which we live.


    If we can help, please call or email us at:

    • Bob
      • 801-364-5300
      • BobSpring@BonnevilleResearch.com
    • Jon
      • 801-746-5706
      • JonSpring@BonnevilleResearch.com

    :: 801-364-5300

    Email Marketing by