In an unprecedented economic recovery, why are we only talking about inflation?

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May 17, 2022
In Commentary

Money by Tracy O. (CC BY-SA 2.0) CC BY-SA 2.0

The economic news is much better than most media coverage would have you believe 

The latest jobs report shows that the U.S. economy continues its rapid recovery from the pandemic crisis. Employers added 428,000 new jobs in April, continuing a now-year-long streak of similarly strong job growth. After surging to a post-World War II high of 14.7% in 2020, unemployment is now down to 3.6%, the lowest level in 50 years.

The employment data mirror other indicators of our strong recovery. Private consumption and business investment have almost completely returned to pre-2020 trends, and household income and wages — even controlling for inflation — are higher now than they were in 2019. Labor force participation, which had fallen from 63.4% to 60.2% in early 2020, has risen again to 62.2%.

The speed and scale of this recovery is without precedent in American history. By comparison, it took 14 years from the onset of the Great Depression for employment to return to 1929 levels. It took over eight years for unemployment to return to its pre-2008 level during the Great Recession, and real income and consumption have never fully recovered from the Global Financial Crisis and the Lost Decade that followed.

The Biden administration’s unprecedentedly aggressive fiscal policy has been central to this extraordinary recovery. The U.S. fiscal response via the American Rescue Plan was larger than that of any other rich democracy, and our recovery has been correspondingly stronger. This is excellent news: policymakers learned the right lessons from the Obama administration’s errors in 2009, when both the size and composition of the American Recovery and Reinvestment Act (ARRA) were completely inadequate to the scale of the damage from the financial crisis.

And yet, news of this unprecedentedly rapid and successful recovery has been drowned out by the drumbeat of media coverage of inflation. A rough metric of this is the massive imbalance between news articles with inflation and unemployment in the headline. Since Joe Biden’s inauguration, this ratio has been 7 to 1, based on available LexisNexis data. In the last month – even as unemployment hit a 50-year low – the ratio has been 24 to 1. Read more

“No one tells me what to do”: Meeting notes reveal favored contractors, animosity toward others in Hurricane Matthew recovery

By
May 17, 2022
In Environment, Housing, News

The Zerbys’ home in Craven County, damaged during Hurricane Matthew. It was scheduled to be finished April 29. This photo was taken on April 28. (Photo: Lisa Sorg)

In response to a Policy Watch investigation published last week, the North Carolina Office of Recovery and Resiliency (NCORR) denied that Rescue Construction Solutions (Rescue) received favorable treatment over other general contractors in bidding and scoring related to Hurricane Matthew disaster recovery work.

Hundreds of households — equivalent to thousands of people — remain displaced from Hurricane Matthew, which occurred in October 2016. These North Carolinians are still living in motels, travel trailers, with relatives, or even in their original damaged homes.

However, notes taken by someone who attended weekly meetings about NCORR’s RebuildNC program show that Ivan Duncan, NCORR chief program delivery officer, did give Rescue leeway not afforded to other contractors. The person provided the notes to Policy Watch on the condition they would not be named, because they were afraid of retaliation by the state. Excerpts appear below; Policy Watch deleted some entries because they were very technical and weren’t relevant to the issue.

Among the revelations:

  • Duncan reportedly told inspectors in May 2021, not to visit homes Rescue had built. This allowed Rescue to sidestep oversight.
  • Duncan also allegedly allowed Rescue to delay starting some of its construction projects, according to notes taken in May 2020. That’s important because contractors’ performance and eligibility to bid on future contracts is based in part on their completion rate.
  • Other examples of alleged preferential treatment include Duncan’s edict to pay Rescue to move a household for the second time; other general contractors were not given the same consideration, the notes say.
  • Last year, the notes indicate Duncan also looked favorably upon RHD, another contractor. However, the notes show that RHD hesitated to accept Duncan’s offers.

The meetings were not recorded because Duncan required attendees to turn off their phones and place them in a bucket. In a previous Policy Watch story, NCORR Director and Chief Operating Officer Laura Hogshead said that practice no longer occurs. The notes indicate that Duncan reportedly said he “works in gray areas,” and asked contractors not to put anything in writing or emails. Such correspondence would be public under state open records law.

Rescue has not responded to written questions about its performance. Instead, the company hired a crisis communications firm, which issued a statement last week saying the company had bid properly, but it did not address the questions.

Policy Watch shared these notes with NCORR. A spokesperson for the agency released the following statement Tuesday morning:

NCORR remains committed to helping hurricane survivors rebuild their homes and communities as evidenced by the more than 700 houses already repaired or replaced in eastern North Carolina. We take the Policy Watch allegations very seriously and will thoroughly investigate to determine their validity and whether corrective action is needed. Many of the allegations thus far have been based on unconfirmed or inaccurate documentation, misinterpretation of program policy, or hearsay from unknown sources. For example, it is misleading to say that only certain general contractors had projects inspected. In fact, all projects had recurring inspections by county inspectors, while the lead contractor in charge of construction oversight, AECOM, was also tracking every project. Whether or not every contractors’ projects had an unannounced visit by state officials, they were all were inspected multiple times by qualified experts. This is just one example of how NCORR has been misrepresented in recent coverage. We look forward to sharing factual information to demonstrate that NCORR is not only committed to helping storm survivors recover, but also to full compliance with the law.

Names of individual contractors have been redacted and replaced with company names. Policy Watch added the annotations and highlighting to explain the significance of those passages.

Abbreviations and definitions
GC: General contractor

CRCS, Persons, Rescue, Duckey, RHD, Excel: Company names of general contractors

AECOM: Construction management company that is the liaison between NCORR and the contractors

Sprayberry: Former Director of Emergency Management Mike Sprayberry

Trace: Trace Allard, NCORR director of program delivery

Open procurement: Competitive bidding process

Ryan: Ryan Flynn, former NCORR chief of staff

O&P: Overhead and profit

ECR: Estimated cost of repairs

MHUs: Mobile home units

Jonathan Doerr: NCORR attorney

NTP: Notice to Proceed; when an NTP is issued, the clock starts on construction, which is required to be finished within a certain amount of time, depending on the complexity of the project, usually 90-135 days. Contractors can request time extensions.

CO: Change orders, adjustments to the construction costs when unforeseen issues arise, such as mold, termites, asbestos

Five helpful tips for Tuesday’s primary

By
May 17, 2022
In Defending Democracy, News
"Vote" pin

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It’s Primary Election Day across North Carolina with voters heading to the polls to select the candidates they would like to see move on to the November 8th general election.

Topping the ballot will be the closely watched U.S. Senate race, a rare open contest with the state’s  senior Sen. Richard Burr retiring.

Other races include U.S. House contests, the N.C. General Assembly, county commissions, district attorney and state and local judgeships.

Now here are five quick tips from the N.C. State Board of Elections to make voting today even easier:

  • Polls are open from 6:30 a.m. to 7:30 p.m. on Election Day. Voters in line at 7:30 p.m. will be able to cast a ballot.
  • Find your Election Day polling place through the Voter Search or the Polling Place Search.Sample ballots are available through the Voter Search tool. Enter your first and last name to pull up your voter record, then scroll down to the “Your Sample Ballot” section.
  •  The State Board does not provide information about candidates for other contests, but some media outlets and advocacy groups do. Many candidates also have websites and social media accounts. Knowing your candidate choices in advance and being familiar with the ballot will help your voting experience go more quickly.
  • If you are voting by mail and have not returned your ballot, you may not return your ballot to a polling site on Election Day. You may mail your ballot back or return your ballot sealed inside the completed envelope in person to your county board of elections by 5 p.m. on Election Day.  If you mail your ballot on or before Election Day, you may not vote again in person.
  • Voters are not required to show photo ID to vote. See Voter ID for details.

If you still feel you need to do a little homework on candidates for the N.C. Supreme Court and N.C. Court of Appeals, a good starting point is the State Board’s Judicial Voter Guide: 2022 Primary Election.

You can find more helpful advice from the NC State Board of Elections here.

When will our ‘pro-life’ leaders do something about gun deaths?

By
May 16, 2022
In Commentary

A bystander looks on outside of Tops market on May 15, 2022 in Buffalo, New York, where a gunman opened fire at the store, killing ten people and wounding another three. Suspect Payton Gendron was taken into custody and charged with first degree murder. U.S. Attorney Merrick Garland released a statement, saying the US Department of Justice is investigating the shooting “as a hate crime and an act of racially-motivated violent extremism.” (Photo by Scott Olson/Getty Images)

Aaron Salter Jr., 55, was on duty at the security job that supplemented his retirement income. Ruth Whitfield, 86, was buying groceries. Celestine Chaney, 65, stopped in for strawberries for the shortcake she and her sister were eager to enjoy.

But their plans went awry Saturday afternoon. Salter’s work shift ended sooner than he expected. Whitfield didn’t make it through her grocery list. And thoughts of strawberry shortcake evaporated in a flash for Chaney.

The three were slaughtered along with seven other people at a Tops supermarket in Buffalo, N.Y. Just like the 20 students, all 6 and 7 years old, and six employees who were massacred at Sandy Hook Elementary School in Connecticut in 2012. Just like the 60 people who were gunned down at a music festival in Las Vegas in 2017.

Too few of our leaders seem to be giving much thought to how we are supposed to guard against tragedies like the one on Saturday and the relentless carnage guns are causing across our nation.

If only our government officials were as interested in these individuals as were the political leaders who have obsessed over University of Pennsylvania swimmer Lia Thomas and her decision to compete for the Quakers or NFL quarterback Colin Kaepernick and his decision to kneel during the national anthem.

Of course, it is easier for politicians to talk about transgender athletes and to look for ways to score cheap political points. It takes time, and it opens a politician up to potential criticism, to do the difficult work of finding ways to reduce gun violence.

It is more difficult to muster the political courage to explore possible changes in laws that now allow anyone to assemble enough weaponry, body armor and high-capacity ammo magazines to outfit an army platoon.

While politicians solemnly offer their thoughts and prayers, these officials prefer to talk about the sanctity of the Second Amendment’s “right to bear arms” than explain how unfettered access to weapons of war squares with the “life, liberty and the pursuit of happiness” promise our founding fathers laid out in the Declaration of Independence. Read more

NCORR disputes PW’s coverage of its Hurricane Matthew recovery work: their complaints, our responses

By
May 16, 2022
In Housing, News

This is one of hundreds of homes damaged by Hurricane Matthew that remain unfinished. (Photo: Lisa Sorg)

The NC Office of Recovery and Resiliency is disputing a previous Policy Watch story that Rescue Construction Solutions received preferential treatment in the bidding and scoring processes. We are publishing their rebuttals and our responses in full, unedited. NCORR sent these rebuttals via email, which are public under state open records law.

=====

First NCORR rebuttal and Policy Watch responses, May 11, 2022:

Dear Laura-

We have reviewed your email and have included our responses to each item below. Let me also say that we certainly appreciate many of the difficulties your agency has encountered over the years in fulfilling its mission (most of which were referenced in our reporting).

As you will see, however, it remains our firm conviction that, except perhaps with respect to a small handful of very minor matters that do not impact its overall thrust, the story is completely accurate.

Simply put:

  • North Carolina received hundreds of millions in federal recovery dollars to distribute to help lower income families rebuild after Hurricane Matthew.
  • Five and a half years after the storm, hundreds of families remain homeless and their abodes uninhabitable.
  • Over a period of time, NCORR awarded contracts for around $80 million to Rescue Construction Solutions even though it almost certainly should have realized that the company and was in over its head, provided false information in its prequalification application, and has consistently delivered poor performance.
  • Rescue was the beneficiary of NCORR contracting decisions not accorded to other contractors.

As has always been the case, however, we stand ready and anxious to receive additional information – e.g., requested documents and other records — that would shed more light on the matter. In particular, we would very much like to conduct interviews with Ivan Duncan and Sheila Brewington – both of whom have thus far not made themselves available to discuss this important matter with which both were so intimately involved.

Our responses to each of the 20 points you raise appear below.

Sincerely,

Rob Schofield
Director
NC Policy Watch

Lisa and Rob –

NCORR requires the following corrections to sections of the May 9 story that are misleading and, in some instances, false. In addition, to ensure an accurate portrayal of the agency and program, the accompanying opinion piece should be amended to reflect the corrected information as well. Should Policy Watch decline to make any of the corrections, please provide an explanation and supporting documentation which demonstrates why inaccurate information should remain in the story. Specific corrections are shown below with direct quotes from the story in italics.

  1. “At least 1,780 houses belonged to low-and moderate-income households.” – As we discussed yesterday morning during our interview, if this is a FEMA number, it has no bearing on the number of homeowners we will be able to help. FEMA does not measure eligibility for CDBG-DR. It is misleading to use a number from another federal agency that is not associated with CDBG-DR eligibility to set a false expectation.

Response: We do not believe it is at all misleading to report FEMA’s count of the total number of homes damaged by Matthew. We find it somewhat surprising that you would need to ask us if this is a FEMA number. Read more

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