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Socialism Key to Prosperity and 3.3% Unemployment
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Socialism Key to North Dakota's Propspertiy and 3.3% Unemployment Rate

The Bank Behind the North Dakota Miracle

North Dakota is the only state to be in continuous budget surplus since the banking crisis of 2008.
Oil is certainly a factor, but it is not what has put North Dakota over the top. Alaska has roughly the same population as North Dakota and produces nearly twice as much oil, yet unemployment in Alaska is running at 7.7 percent. Montana, South Dakota, and Wyoming have all benefited from a boom in energy prices, with Montana and Wyoming extracting much more gas than North Dakota has. The Bakken oil field stretches across Montana as well as North Dakota, with the greatest Bakken oil production coming from Elm Coulee Oil Field in Montana. Yet Montana’s unemployment rate, like Alaska’s, is 7.7 percent.

A number of other mineral-rich states were initially not affected by the economic downturn, but they lost revenues with the later decline in oil prices. North Dakota is the only state to be in continuous budget surplus since the banking crisis of 2008. Its balance sheet is so strong that it recently reduced individual income taxes and property taxes by a combined $400 million, and is debating further cuts. It also has the lowest foreclosure rate and lowest credit card default rate in the country, and it has had NO bank failures in at least the last decade.

If its secret isn’t oil, what is so unique about the state? North Dakota has one thing that no other state has: its own state-owned bank.

Access to credit is the enabling factor that has fostered both a boom in oil and record profits from agriculture in North Dakota. The Bank of North Dakota (BND) does not compete with local banks but partners with them, helping with capital and liquidity requirements.

North Dakota’s money and banking reserves are being kept within the state and invested there. The BND’s loan portfolio shows a steady uninterrupted increase in North Dakota lending programs since 2006.

http://gooznews.com/?p=3147

So since North Dakota has a govt. run bank, it must be on the verge of bankruptcy and collapse, right? WRONG! The bank had a 19% profit return on investment. Goldman Sachs would kill for thoser kinds of numbers.

I am continuously amazed at the lack of communication between state governments and agencies. Why is it SO hard for a good idea like this to spread to other states?

Oh, wait. . . it's because people are stupid, that's right . . .

no, it's because the banks would never allow such an idea to spread nationwide.

China has this arrangement. It enables them to have deceptively low debt to GDP numbers, except the banks are insolvent(next shoe to drop).

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Per capita income ranks 29th in the country and 3rd least populous state.

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So Egyptians are millionaires?

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I'm willing to bet that the average ND family has more disposable income than the average NYC family when you adjust for cost of living. The median home price in Fargo, ND is $144,000 and the median income is $72,000. That's not bad. How many cities ithe U.S. are the houses selling for 2 times the median income???

http://money.cnn.com/magazines/moneymag/bplive/2011/snapshots/PL3825700.html

With the huge amount of money you save by living in ND, you could afford to have your own live in chef.

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Don't confuse Socialism with crony capitalism.

Absolutely the stupidest post I have seen on streeteasy.

Few facts: Republican run state, 670K mostly white population with fewer black and latino to use welfare, oil boom. Carve out manhattan below 96th street into a separate state, kick out the free public housing, divide penstion liability in proportion to population with the rest of the city, Manhattan will be the richest capitalist place in the US with a population bigger than North Dakota.

http://en.wikipedia.org/wiki/North_Dakota
http://quickfacts.census.gov/qfd/states/38000.html

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I did not want to call socialist stupid without giving a reason.

"mostly white population with fewer black and latino to use welfare"

sniff sniff, I smell racism.

It is a fact that higher percentage of black and latinos are on welfare than whites. What is racist about stating facts.

this thread seems awfully hostrile to Obama. I better report it so that appropiate action can be taken.

http://my.barackobama.com/page/signup/o2012-attackwatch-report-an-attack

post Solyndra scam and Turner victory as well.

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"Socialism Key to Prosperity and 3.3% Unemployment"

Is that the unemployment rate in prosperous France? Sacrebleu, nous voulons mange du gateau aussi! (apologies for my rusty french)

Yes, because Fargo, ND is another Detroit. Yet another dumb comment from the resident idiot.

Germany increased employment by paradoxically cutting unemployment benefits..

http://www.npr.org/player/v2/mediaPlayer.html?action=1&t=1&islist=false&id=140548788&m=140551981

The model here is Germany. It has used a "short work" policy to keep the unemployment rate down – at very low cost to the government. Its unemployment rate today is 0.5 percentage points lower than it was at the start of the downturn, even though the German economy actually has grown less than the US economy over this period.

There are many different packages that fit the short work scheme, but the basic story would be that rather than having a firm lay off 20% its workers, the government encourages the firm to cut their work time by 20%. The government directly replaces 60% of the lost wages (12% of the total wages); it has the company replace 20% (4% of total wages); and leaves the worker taking home 4% less and working 20% fewer hours.

The cost should be about the same as the unemployment insurance benefit that workers would have received if they were laid off, but the short work policy keeps them employed. This has two major benefits. From the standpoint of employers, they have workers available whose hours can be quickly increased if demand picks up. This saves them the need to find and train new workers.

http://www.guardian.co.uk/commentisfree/cifamerica/2011/jun/30/economic-policy-short-work

The German model of subsidizing the wages of workers makes a lot of sense, which is why we will never have it here. Better to give out more tax cuts to corporations.

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"Socialism Key to North Dakota's Propspertiy and 3.3% Unemployment Rate"

what's interesting about this thread is that no one has mentioned the real reason for the success in north dakota described in the article. it's not "socialism", it's the STATE's ability to address, resolve and successfully manage their particular local affairs in a way that the FEDERAL government simply cannot do. the real winner here is state's rights. and, yeah, that's not socialism but something else entirely.

Yes, states' rights in a state that gets back $2 for every $1 it sends to D.C.

this is why libertarians always end up losing so many arguments. because they mistakenly believe that people actually know what "libertarian" means. but they don't. when someone says if you're libertarian you must not like roads and firefighters, they really believe that. they really don't understand that all you really believe is that states are in a better position to handle their own unique affairs than the federal government and should enabled to do this more often. that's all it means.

So then why do states immediately run to the federal govt. for money anytime there is a natural disaster?

States' right brought us slavery and Jim Crow. It's a discredited political theory that Republicans only support when a Democrat is president.

because they can? are you looking for a deeper answer than that?

Yes, they can ask for money. But Obama does not have to give it to them. IF Red states liek states rights so much, they can strt implementing it by no longer sucking money from the feds.

"States' right brought us slavery and Jim Crow."

but state's rights also brought us the "socialist" victory you are praising i this thread. uh oh.

you're such a faker socialist. a fake stupid person. you know obama most certainly has to write them a check within a fortnight of the received request and sign it,

b.h. obama, mayor of the federal government

Was that an attack against Obama? Uh-oh, I have to report you:

http://my.barackobama.com/page/signup/o2012-attackwatch-report-an-attack

The Solyndra was a great example why Socialism does not work. The government came in to take risks that no private money thought was worth taking, having understood the odds of failure. And the government proved it was no more insightful( in fact less). We're not talking basic research a whole other story, but trying to show government is better at picking winners and losers than the private market, and it aint.

And I love this, the new Asthma tax
-----------------------

Remember how Obama recently waived new ozone regulations at the EPA because they were too costly? Well, it seems that the Obama administration would rather make people with Asthma cough up money than let them make a surely inconsequential contribution to depleting the ozone layer:

Asthma patients who rely on over-the-counter inhalers will need to switch to prescription-only alternatives as part of the federal government's latest attempt to protect the Earth's atmosphere.

The Food and Drug Administration said Thursday patients who use the epinephrine inhalers to treat mild asthma will need to switch by Dec. 31 to other types that do not contain chlorofluorocarbons, an aerosol substance once found in a variety of spray products.

The action is part of an agreement signed by the U.S. and other nations to stop using substances that deplete the ozone layer, a region in the atmosphere that helps block harmful ultraviolet rays from the Sun.

But the switch to a greener inhaler will cost consumers more. Epinephrine inhalers are available via online retailers for around $20, whereas the alternatives, which contain the drug albuterol, range from $30 to $60.
http://www.weeklystandard.com/blogs/obama-administration-ban-asthma-inhalers-over-environmental-concerns_594113.html

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Don't you just hate it when facts get in the way of a good partisan rant against Obama? Next thing you know, someone will say that Obama signed TARP.

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Centralized planning works well initially, technocrats have little difficulty identifying projects with high return on capital, but over time the low lying fruit is gone, and they begin the Mal-investment. It happened in Russia, it happening in China right now, and it even occurs in the U.S.(solar-solyndra). Everyone predicted the USSR would surpass the U.S. in GDP years ago. They were wrong. Similar predictions were made regarding China, yet right now China has invested foolishly and consumption as a percentage of GDP has collapsed. Maybe China will overtake us but it won't be for decades to come.

Capitalism works better than a planned central economy. What gov't needs to do is ensure a level playing field and enforce basic property rights and avoid crony capitalism.

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There was a great piece on about North Dakota last night on NBC. Truck drivers make $80,000 a year and one electirican had 4 job offers within 2 hours. Even fast food workers make $15 an hour.

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http://ac360.blogs.cnn.com/2012/05/30/california-high-speed-rail-to-nowhere/

This commenter doesn't get it:

"The average price round-trip for a family of four, according to the rail authority's own figures, is $648 – plus car rental at your destination to actually get where you're going plus paying to park your car at the HSR lot while you're away."

No, you live near one of the stops and take the bus there, and then hop on the bus (which will be waiting outside the station) to get wherever you're going -- like all train/bus-oriented societies do. He's a Californian who can't conceive of not being dependent on a car.

The only place in the country a true high speed rail line might make sense is the Bostom to DC route where you have the density of buisness travelerst that justify the price. A true high-speedc rail (not the acela compromise) would increase productivity along the whole north east corridor by cutting down on commute times and cut donwn on air -tavel and airport upgrades. Leisure riders are not as time sensitive and the economics are different when it comes to whether they would pay enough to justify.

You only get to compare rates for the infrastructure that is in place, not the dream of some sort of Boston to NYC commute you wish in the case of HSR.

On the East Coast you really could replace a flight from Logan to La Guardia (with commensurate taxi's) with an HSR where the central stations are in the midst of dense urban areas with robust and mature mass transit. If you want to link LA with something.... not so much.

And even on the East Coast, HSR does't get you to IBM's headquarters, or Pepsci, or Johnson & Johnson, not to mention the myriad small companies in between, nor does would it be linked via Mass transit to the suburbs the way are some of the regional airports. You can't rent a car or park one at the stations that are the dream locations of HSR stations.

It really is just a wet dream of the 1% who would be using these systems, subsidized by the rest of the population.

"the 1% who would be using these systems, subsidized by the rest of the population."

We 1% who would love to have such train infrastructure are subsidizing the automobile infrastructure used by the majority without getting anything out of it. How about they subsidize us for a change?

The metric for these projects should be whether productivity goes up for the population sufficiently enough to justify the expenditure. In California there are simply not enough business people who would travel back and forth and pay a premium to justify the project. In the North East you just have to offer a service that is a little cheaper and a little faster than taking air route. Plus you cut out taxi expense etc. But our brillian politicians want to focus on Florida, California to Vegas etc

"So since North Dakota has a govt. run bank, it must be on the verge of bankruptcy and collapse, right? WRONG! The bank had a 19% profit return on investment. Goldman Sachs would kill for thoser kinds of numbers."

Okay I'm along with everyone here is sold. Let's give all out money to the Sate of New York to manage.

I don't agree with Ellen brown of gooznews or whatever newspapaer she writes for..

Her solution is instead of having a private banking cartel counterfeit money, lets have some govt beaurocrats counterfeit money and lend it out. In the end its an evil scheme that will only attract lobbyists, bribery and corruption of beaurocrats deciding who to lend money to - no different than the present scheme.

For every dollar counterfeited out of thin air by private banks or the state, a dollar is robbed from those who worked hard to save a dollar.

Publically owned banks will be much like the "publically" owned IMF which is publically handing out funds to private banking crooks in Europe which they will default on. You will be left holding the bag.

What's wrong with the idea of borrowing money from the people who have worked for it and saved it instead of these elaborate schemes. It only leaves the door open to corruption, bribery and theft ie JP Morgan.

North Dakota's is the third least populous state and has virtualy the lowest economic output of all 50 states. We're almost talking developing nation here, so maybe a state owned bank makes sense, North Dakota has more in common with an emerging economy than a devleoped one such as New York or California. Bringing up the state owned bank is just non-sense.

Pretty much any system that endorses fraud whether it by public or private is wrong. Making private banks Public would change nothing other than 'technical' ownership. A commodity based currency with full fractional backing by the US treasury is the only answer with private non-monopolistic banks that have the ability to lend out at interest.

mis-understood you renter, thought you were arguing for north dakota..

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5000 years of history could not disagree with you more. Centralism has always lead to a lower standard of living.

Christine Romer says most economists prefer the earned income tax credit to the minimum wage.

http://www.nytimes.com/2013/03/03/business/the-minimum-wage-employment-and-income-distribution.html?smid=pl-share&_r=0

RAISING the minimum wage, as President Obama proposed in his State of the Union address, tends to be more popular with the general public than with economists.

I don%u2019t believe that%u2019s because economists care less about the plight of the poor %u2014 many economists are perfectly nice people who care deeply about poverty and income inequality. Rather, economic analysis raises questions about whether a higher minimum wage will achieve better outcomes for the economy and reduce poverty.

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