October 20, 2010 in Idaho

Ad Watch: Allred blames Otter for economy

By The Spokesman-Review
 

BOISE - A new campaign commercial from Keith Allred, the Democratic candidate for governor of Idaho, blames GOP Gov. Butch Otter for the state of Idaho’s economy, saying Otter “focused on helping special-interest cronies instead of creating jobs.”

Allred cites a big decline in the rate of personal income growth in Idaho since Otter took office, compared to surrounding states, along with a drop-off in the growth rate for the state’s gross domestic product, the very measure Otter has targeted to grow with his “Project 60” economic initiative.

Otter’s campaign counters that a USA Today article just named Idaho one of the states “leading the nation’s crawl out” of the recession, which noted that Idaho rose from 50th in the nation for personal-income growth during the recession years, to 10th since the recession officially ended in June of 2009. The article called that “the USA’s biggest rebound.”

“National accolades don’t just happen without true leadership,” declared Ryan Panitz, spokesman for Otter’s campaign. “Gov. Otter made the necessary changes to government and got people working together to better our economy.”

Actually, said Boise State University economics professor Don Holley, “The economy’s not doing very poorly, and it’s not doing very well - it’s just like every other state, it’s kind of reached the bottom and not moved off of it.” The best and most up-to-date statistics on the state of the economy, he said, are employment and unemployment. Idaho had very low unemployment rates before the recession, but “we got worse faster than almost anybody else,” led by the collapse of a highly speculative housing market.

Allred’s ad, zooming in from a map of surrounding states to Idaho, says, “Idaho’s economy, worse than these surrounding states, all on Butch Otter’s watch, because Otter focused on helping special-interest cronies instead of creating jobs. And Otter even tried to raise taxes and fees.”

That last statement refers to Otter’s 2009 proposal for a 10-cent increase in Idaho’s 25-cent per gallon gas tax, plus large increases in vehicle registration fees, a tax on car rentals and more, all to fund transportation improvements; none of those passed.

On the cronyism charge, Allred cites the current lawsuit by fired Idaho Transportation Director Pam Lowe, which contends she was fired in part for trying to trim a huge contract with politically well-connected firms, and the multimillion-dollar Idaho Education Network bid award to Qwest over a lower bid from Syringa Networks, which also has embroiled the state in a pending lawsuit.

However, Allred cites no source showing that the alleged cronyism hurt job creation.

“One way to create jobs was to increase the gas tax and registration fees to have the transportation infrastructure improvements that Otter was looking at,” noted Jim Weatherby, political scientist emeritus at Boise State University.

The ad then highlights Allred’s economic plan: “Cut tax rates by closing special-interest tax exemptions, all to create more growth and new jobs,” and concludes, “No wonder so many Republicans have endorsed Keith Allred for governor.”

Weatherby said that’s what Allred’s proposing - a revenue-neutral elimination of exemptions, with any savings to go toward reducing overall tax rates. “That is his plan, which is more typical of a Republican candidate than a Democratic candidate,” he said. Allred also has had an array of high-profile Idaho Republicans endorse his campaign; many of them are pictured in the ad.

Democratic lawmakers have talked about eliminating special-interest tax exemptions to raise more money for education, but Allred has steered clear of that, saying the reason he wants to eliminate exemptions is to have a broader tax base with lower rates. He’s also called for reducing both the gas tax and the state’s personal income tax.

Panitz said, “Let’s not forget that these ‘special interest tax exemptions’ our opponent talks about include health care, child care, and a host of other services - as well as the industries that provide careers and economic opportunities for our citizens and communities.”

That’s the point being hammered in an independent ad sponsored by the Idaho Republican Party, which accuses Allred of wanting to tax everything from child care to church bake sales; the party recently launched a second version of the ad making the same claims.

Allred says he wants groups of 1,000 Idahoans from each of Idaho’s 35 legislative districts to study and review exemptions, and he’d only back eliminating those for which 60 percent of those citizens agree. He’s said all exemptions should be on the table for review by citizens.

Weatherby said the ad exaggerates by “blaming Otter for our poor economic performance during the global financial crisis. But,” he said, “governors typically are blamed for poor economic performance of their state, just as they take great credit when the state’s economy does well.”

He said, “I think overall it’s pretty effective.”

The ad began airing this week statewide, including the Spokane TV market.


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