Julius Jolley burst into the pancake house, his smile a banner across his face.
“Coffee, please. Eggs Benedict, easy on the sauce, no potatoes, no pancakes, fruit cup if it’s fresh,” he called to a waitress, not stopping until he reached the table where I sat with my newspaper.
“Wonderful day,” Julius exclaimed. “See the story, spoilsport?”
“Which story?” I asked, although I knew the answer.
“The state personal income data just released by the U.S. Bureau of Economic Analysis,” he said with a smile like a poppa wolf bringing a fresh carcass back to the den.
“I saw it,” I said flatly. “It was OK; Indiana’s annual average growth rate for personal income from 2007 to 2009 (0.64 percent) exceeded that of the U.S. (0.57 percent) and of our industrial neighbors (Ohio, Michigan, Illinois and Wisconsin).”
“Yes,” he beamed. “And … what else?”
“Our population growth rate (0.60 percent),” I said, then paused to gulp some coffee, “was higher than any of those other four states, although lower than the national rate (0.90 percent).”
“Isn’t that cause for a big smile?” he taunted.
“It is,” I said, “if small differences in pathetic numbers make you happy.”
“That’s cruel and unbecoming commentary from a gentleman,” he said and turned his attention to his order, which had just arrived.
“Public relations and puffery are not my business,” I said. “Both the Indiana and U.S. income growth rates are extremely small and each rounds off to a measly 0.6 percent. To be somewhat healthier than your sickly neighbors does not mean that you are well.”
“You’re refusing to get to the heart of the matter,” Julius scolded. “From 2007 to 2009—during the worst times since the 1930s—Indiana’s per-capita personal income, the general standard of economic well-being, rose, climbed, expanded, improved while the per capita personal income of the nation fell, declined, contracted and deteriorated. Do you deny it?”
“No,” I admitted. “But it’s nothing to be excited about. The Hoosier increase you cite was a pathetic 0.03 percent, and that’s without taking into account the low 1.7-percent average annual increase in consumer prices during those years. That means real income in Indiana fell. Yes, the U.S. was worse, but we were still in the lower half of all states. So what’s to celebrate?”
“We need to celebrate,” Julius insisted. “Hoosiers need to hear the good news. That’s why you hear so much about positive plans, intentions and aspirations. These give us hope, which is the currency of bad times.”
“What does hope buy?” I asked. “Are banks crediting mortgage payments when a homeowner brings in a bushel of hope?
“Indiana has hard realities to face. We are hobbling local governments with our irrational opposition to local property taxes. We do nothing about wasteful township governments. We refuse to consider a progressive income tax.
“All the while, our economic base is shrinking. Indiana’s share of U.S. earnings from durable goods manufacturing is smaller today than it was in 1990. In the past two years, earnings in this sector fell an average of 10.6 percent here, compared to a national drop of 7.2 percent. This is our primary economic issue, not protecting horse racing and casino profits.”
“Aren’t you asking a lot?” Julius demanded. “What do you expect to do about durable goods manufacturing or whatever you said?”
“The Legislature could increase funding for the technical assistance program at Purdue. They could employ faculty or staff from our various universities to help solve management problems, like lazy thinking and lack of imagination.”
“You’re not an economist anymore,” he told me. “You’ve become a comedian.”
I didn’t find anything funny to laugh about.•
Marcus taught economics for more than 30 years at Indiana University and is the former director of IU’s Business Research Center. His column appears weekly. He can be reached at firstname.lastname@example.org.