In his op-ed column in Friday's Rapid City Journal, Gov. Daugaard claims I erred in comparing U.S. gross domestic product with South Dakota's GDP in my Journal column last week. He's mistaken. I compared per capita GDPs, which are a vastly different and far more informative depiction of economic growth.
Per capita comparisons take into account population growth. For example, if GDP growth is 2 percent but population growth is 3 percent per capita GDP has actually declined because economic growth hasn't kept pace with the growth of the population.
Here's a concise definition among many that are easy to find online of why the difference is important: "GDP per capita is a measure that results from GDP divided by the size of the nation’s overall population. The GDP per capita provides a much better determination of living standards as compared to GDP alone." In other words, the macro (GDP) number is one thing; its per capita counterpart is another.
It's wonkish, I know, but Daugaard's correct citing of GDP growth has nothing to do with my comparison of GDP per capita growth. Using the Commerce Department's Bureau of Economic Analysis data, Daugaard would clearly see that U.S. GDP per capita growth has vastly outperformed South Dakota's, with the U.S. figure coming in at about +6 percent, and South Dakota's declining a bit.
I stand by my characterization of South Dakota's performance as "pathetic" and my belief that holding the state's governing class to an objective standard when it comes to issuing pay raises seems reasonable and consistent with many private sector salary benchmarks that are based on performance.
The governor himself even applies the principle. In his fiscal year 2018 budget message, Daugaard delayed or deleted pay raises for state employees. A no-growth economy resulting in a drop of government revenues means nobody gets a real raise, which is basically the point I made in the first place.
Also, Gov. Daugaard in the course of his piece noted that I often refer to myself as a Republican, but that my "op-eds and blog demonstrate (my) liberal bent on most issues." From a lawyer presumably trained in the rudimentary principles of logic, Daugaard's ad hominem distraction comes as a surprise, though I suppose in this politically tribalistic culture of ours fallacious reasoning and its subsequent diversions can come to be expected.
In any event, I'm no longer a Republican, having changed my registration to independent several months ago. What hasn't changed is that on a per capita basis, South Dakota's economy has fallen significantly behind that of the United States and five of our six neighboring states. Is Daugaard to blame? Maybe, maybe not. I'm just delivering facts.
That said, I do appreciate that Gov. Daugaard has given my work his time and attention, especially in a forum like the Rapid City Journal. Our differences are obvious and profound, but in the long run everybody's awareness and understanding are elevated by public conversations like this. I wish the governor well as he comes into the concluding year of his administration.