text:
Whistling Past the Intellectual Graveyard

The Extreme Supply-Sider one in Topeka, that is. Josh Barro notes how tax cuts failed to result in entrepreneurial renaissance that would result in revenue increases; Wonkblog further observes (I did before) that employment growth has collapsed utterly and completely. Paul Krugman has dissected the social dynamics underpinning the adherence to patently unsupported ideas, but it is always useful to reiterate the facts of the case.

Kansas is doing so poorly in terms of private employment growth since 2011M01 — the beginning of Governor Brownback’s administration — that it rivals in (poor) performance Wisconsin [1].

Figure 1: Log private nonfarm payroll employment for Wisconsin (red), Minnesota (blue), California (teal), Kansas (green) and the US (black), all seasonally adjusted, 2011M01=0. Vertical dashed line at beginning of terms for indicated governors. Source: BLS, and author’s calculations.

It turns out that broader measures of economic activity confirm the collapse in growth. The recently released Philadelphia Fed coincident index shows May activity lower than that in January of the year. This means the cumulative growth gap (from 2011M01) between national activity and Kansas has widened to 2.8% (log terms).

Figure 2: Log coincident indices for Kansas (blue) and the US (black), seasonally adjusted, 2011M01=0. Implied levels from leading indices for Kansas (blue square) and US (black triangle) for 2014M11. Dashed lines at 2011M01 (beginning of Brownback administration). Tan shading denotes period that tax cuts apply to. Source: Philadelphia Federal Reserve May releases for coincident indices and leading indices, author’s calculations.

Forward looking indicators from the Philadelphia Fed indicate that over the next six months, the gap will widen — to 3.8% (Figure 2). Figure 3 depicts where Kansas sits in the distribution of state six month growth rates (not annualized). The wisdom of Moody’s decision to downgrade Kansas government bonds in April seems to have been borne out. [3]

Figure 3: Frequency distribution of six month non-annualized growth rates. Solid red line at Kansas growth rate; solid black line at US growth rate. Source: Philadelphia Fed leading indices, May release.

Kansas sits in the bottom quarter of the distribution. The gap between the US and Kansas non-annualized six month growth is over a percentage point. The corresponding gap over the entire period which the Philadelphia Fed has been tabulating the coincident indices is about a quarter of a percentage point (this is essentially a state-specific “fixed effect”). (Note: one cannot appeal to antediluvian views on the negative impact of minorities on growth, as in this comment, since Kansas is relatively homogeneous.)

Concluding thoughts: After three years of an experiment in ALEC-Laffernomics, Kansas lags the US economy significantly. This should be no surprise to anyone. Over thirty years ago, I interviewed Arthur Laffer for the Harvard International Review about the supply-side scenario. I was skeptical then. I see no reason, from the experience of Kansas, to be any less skeptical now (See this post for a statistical analysis, and links to more comprehensive empirical analyses).

Addendum, 5:50PM Pacific: Bruce Hall, who previously asserted Wisconsin’s negative performance with respect to Minnesota was partly due to the higher minority population in Wisconsin, now asserts California’s outperformance with respect to Kansas is comparable ‘to an F student who raises his grade to a C to an A student who just “plods along.”’, where Kansas is the A student because its government is “well run”.

I have calculated the log ratio of Kansas to California coincident index, taken the first difference and multiplied by 12 (so the coefficients are interpretable as impact on annual growth rates) regressed it on a constant, time trend, and a dummy that takes on a value of one when Governor Brownback comes into office. The time trend thus accounts for the alleged poorly run policies of California. Here are the results:

Δz = –0.020 + 0.00004×time – 0.016×BrownbackDummy

Adj-R2 = 0.02, SER = 0.03. Bold face entries denote significance at the 5% MSL.

The results indicate that relative annual growth is 1.6 percentage points slower under Governor Brownback.

80 thoughts on “Whistling Past the Intellectual Graveyard

  1. chris herbert

    It still hasn’t sunk in to the Republican rank and file. They obviously vote on inertia.

    1. axt113

      No, you need to understand why republican economics exists.

      It’s not for the sake of economic growth it’s to transfer wealth to the rich.

      Now as for why the average citizens go for it, it’s wedge issues, racial dog whistles, and social issues based on religion, Are all designed to manipulate the poor and middle class whites that make up the GOP into voting against their own interest.

      Before 1964, whites were very supportive of social programs and the such, because they viewed the gains as going to whites. This was how the new deal coalition held.

      When the Democrats tried to extend such benefits to non-whites, the GOP used that as a.wedge claiming that these “welfare” programs were taking from whites to give to non-whites, of course they used coded racial appeals to communicate such things, they didn’t say it overtly, but they utlization these coded appeals to foment racial divisions between whites and non-whites and drive whites against the very programs they had previously supported.

  2. BC

    Supply-side effects occur historically after the Long Wave peak (peak rate of change of increase in commodities prices and price inflation), during a period of falling nominal interest rates and resulting reflationary effects to asset prices and growth of credit until debt to wages and GDP reaches a cumulative differential order of exponential scale, i.e., the jubilee threshold, at which point a financial crisis occurs coincident with the onset of the debt-deflationary regime and Schumpeterian depression of the Long Wave Trough.

    Historically, the crisis at the onset of the debt-deflationary regime clears the decks of excess debt to wages and GDP, permitting a transition to a demand-side regime to commence. However, the US, UK, and EZ TBTE banks printing themselves, via their central banks, trillions to bail their balance sheets and to achieve reporting dubious book entry profits without reducing loans and overall systemic debt to wages and GDP forestalled, or prevented, the debt-deflationary clearing of the decks and encouraged public debt to soar to wages and GDP (now similarly at the jubilee threshold that prohibits further growth of public debt to GDP).

    The unprecedented bailout of the TBTE banks, their equity holders, and creditors again encouraged non-productive leveraged financial speculation, bubbles, and increasing systemic risk, creating a sense of complacency that the crisis was avoided once and for all, while ensuring the inevitability of the next financial and economic crisis, albeit at a larger scale to wages, GDP, and gov’t receipts.

    The TBTE bank bailout and resulting larger financial bubble as a share of wages, GDP, and gov’t receipts virtually ensures that the next crisis will be larger, more destructive, and risk complete loss of credibility and legitimacy of eCONomists, Wall St., TBTE banks, the Fed, CEOs, rentier-captured DC politicians, and financial mass-media apologists and shills for Wall St. and the rentiers, who are the primary beneficiaries of bubbles and the neo-feudal, parasitic system of rentier extraction of surplus labor product, profits, and gov’t receipts in perpetuity.

    None of this, of course, is lost on the rentier-parasitic Power Elite top 0.01-0.1%, the TBTE Anglo-American and European bankster oligarchs, their facilitators at the Fed, BOE, and ECB, and their establishment eCONomists intellectual apologists and enablers.

    “All along the watchtower . . . the hour is getting late . . . “

  3. Bruce Hall

    Sigh…. Growth occurs for many reasons not related to welfare programs and government dumping of cash and creation of huge debt maintenance. But I do like your comparison of Kansas to California which shows that the recent growth rate of an abysmally run state exceeds that of a well-run state. Sort of like comparing an F student who raises his grade to a C to an A student who just “plods along.”

    We really can’t be that naive, can we?

  4. PeakTrader

    If I was born and raised in Kansas, would my goal be to attend the University of Kansas and work in Wichita?

    Maybe, it would be to attend CU-Boulder, hang out with the affluent, get a job at Denver’s “Wall Street of the West,” or Colorado’s Silicon Valley: The Denver Tech Center, or start a business, where people earn more than a Social Security check?

    Paul Krugman on his Nobel Prize paper: “Today, 60 million people live along a narrow stretch of the East Coast. Those 60 million people aren’t there because of the scenery; each of them is there because the other 60 million people are also there.”

  5. pete

    Statistical issues…..as with most macroblogging, we have more or less an observation, or say CA vs. KA. Oooo, 2 points, sorry. Then we make inferences. Did it work or not? Have to repeat about 100 X to get some reasonable answer to that question. This is just clear macroblog bias, picking a couple of points and assuming there is truth. Look at the IMF having to appologize for being wrong on England. Why? Were they wrong, or just the coin came up heads instead of tails? Silly.

    1. Menzie Chinn Post author

      pete: I didn’t do the 50 states comparison because…I’d already done it — as referenced in the post. Please consult this post. That’s not quite 100, but given your standard, one would never write anything. Maybe that is what you would prefer.

      IMF apologize to the UK? Edify yourself, stop reading the talking points, and start reading a real macroeconomist.

      (And this from a person who writes “Changing transfers is neither contractionary or expansionary.” Yeesh)

  6. Julian Silk

    I have no wish to justify the economic policies of Gov. Brownback, or the Republicans in Kansas. But as I am finding with the statistical analysis of temperature data, really examining the counter-factual isn’t easy. Wheat has fallen on the CBOT from 700 to about 565 over the course of the year. It’s not a trivial estimate to infer Kansas cattle prices, but they seem to have slightly declined over the year. Both hog and cattle inventory in Kansas are down over the year, according to the NASS reports. Corn prices have fallen from around 525.00 cents per bushel to 422,25 cents per bushel. Sorghum prices have fallen from 236.78 dollars per metric ton to 221.01 dollars per metric ton as of May. Transportation services demand for the U.S.A. seems to be only mildly growing, so Kansas transportation sales may not have been that great. Food processing employment nationally is only up about 5,000 from May 2013 to May 2014, according to the BLS data. The GAMA statistics on aircraft sales (at http://www.gama.aero/files/2013_GAMA_Databook-LowRes-02192014.pdf) show a recovery for 2013 for the entire aircraft market, but certainly that could have been cut into by the cold weather of the 1st quarter for Kansas. I would be delighted to see Koch Industries go bankrupt, but this hasn’t happened yet, and it is difficult to infer their revenues, since they do not release quarterly reports as a privately owned company. (Their “Fact Sheets”, etc., tell about their market presence, but do not provide any significant time series statistical data to use to examine how they are doing in 2014 relative to 2013.) All this would seem to indicate that the Kansas tax base has not grown significantly, and might not have grown so under more sensible policies, either.

    1. Menzie Chinn Post author

      Julian Silk: As a matter of record:
      Food grains prices approx. 20% below Jan 2014 five-year peak, but still equal to mid-2013 levels; see USDA NASS
      Meat animal prices hit a peak earlier in 2014; see USDA NASS
      Durable manufacturing equipment employment (nsa) did fall in December, but as of April (past the coldest weather), has not recovered to October 2013 (before the winter); see BLS via FRED.

      So the agricultural sector performance (arguably largely exogenously determined at this frequency) doesn’t seem to be a good explanation for lagging output, tax revenues. On the other hand, it’s arguable that transportation manufacturing is lagging, hence depressing tax revenues. However, weren’t the tax cuts aimed at resurrecting the economy by encouraging businesses. That’s certainly in the Governor Brownback’s strategic plan?

      Could it be that output has stagnated because of the 3% decline in government employment in Kansas since January 2011?

      1. Julian Silk

        I don’t disagree with these arguments, including the negative effect of government employment. What is being stated here is correct, and I am not doubting it. But I would just put it in statistical terms:

        Tax revenues = t * TB, where TB is the Tax Base, and t is the tax rate.

        t has fallen, as have government spending, etc. TB has risen, but poorly. and it would seem in terms of an estimate:

        TB(predicted) – 2* se(prediction) < TB(actual) << TB(predicted) + 2*se(predicted)

        In daily life, the conservatives who want smaller government as a religious belief, immune to any factual argument, basically state that the cuts in government were never intended to raise revenues the first year. It's always supposed to happen in some indefinite future, possibly the afterlife. To the extent that any factual evidence can be mustered against these arguments, it would appear that TB(actual) << TB(predicted) – 2*se(predicted). Then it is conceivable that you would be able to talk to the most heretical.

        In the case of transportation equipment, the argument would be that you could only hope for a redistribution of production with tax cuts in a falling aggregate amount, like shifting water from one puddle to another in a shrinking lake. You would then have the statement that transportation spending is falling so much because of high gasoline prices (all due to President Obama's awful policies, including the ethanol mandate), etc., that this could not have been predicted. I agree this makes no sense, but you always get shifting the argument when the original premises fail.

        Until you have falls in the tax base significant enough, in a non-statistical, political sense, that conservative Republican legislators lose their seats because of them, none of these arguments will change. My hope is that you would be able to get the information to put it in statistical terms, so that it could be taught in a classroom, without comment.

  7. Ricardo

    Menzie’s article demostrates both his ignorance of supply side economics and his weak reading comprehension.

    First his ignorance of supply side economics – never does Menzie mention the Laffer curve. For a tax system to have a supply side effect it must impact those taxes that are on the disincentive side of the curve. Menzie either is ignorant of this aspect of supply side economics or he is disingenuous by intentionally ignoring it.

    That brings us to Menzie’s weak readin comprehension. Barro was very clear in his analysis of the Kansas tax cuts but Menzie did not address his analysis at all. It is cleear from Barro that Kansas has implemented tax cuts that have a negative supply side effect. Unlike the demand side theories (Keynesian and monetarist) supply side economists do not believe that all tax cuts and all monetary expansions are the same. Digging holes and then covering them up do not generate production, employment, nor wealth. When tax cuts are implemented (such as the first Bush Keynesian tax cut) that do not impact production or, as in the case of Kansas, actually reduce tax revenue without generating additional supply through production they are not supply side tax cuts.

    Supply side theory requires much deeper thinking than the demand side mercantilist thinking. Mercantilism is based on emotional feel-good economics founded in illusion. Rather than disproving supply side economics the experience in Kansas, Illinois, Californis, and New York prove supply side theory, but only for those who do not settle for superficial thinking.

    I encourage you to read Barro’s article to better understand economics.

    1. Patrick R. Sullivan

      To make the point even more clear, the Laffer Curve says that at tax rates of 0% you get zero revenue. Josh Barro’s piece says Kansas applies a 0% tax rate to certain types of income. Guess what Laffer would expect the revenue to be.

    2. BananaGuard

      So Brownback was not engaged in a supply-side effort? If that’s the case, there is really no economic justification for the tax cut. It amounts to nothing more than an undermining the states fiscal position. That’s good to know.

      So, Ricardo, is it you contention that Brownback knew he was not engaged in a supply-side effort? Was he operating out of ignorance or was his thinking more Straussian?

      Also, I’d like a bit more clarity on the whole incentive/disincentive business. I understand that revenue is sensitive to the side of the curve one is on, but are you saying that supply-side incentives don’t apply at low tax rates?

      1. baffling

        banana, it is hard to get a valid response from guys like ricardo, who are wed to an ideology no matter what the facts and data show. he is like a broken clock, right twice a day and completely wrong the other 99.99% of the time!

  8. pubsky

    can we get NJ added to this map?

    Also say one of its neighbors in PA or NY as a comparison.

    NJ is in the middle of phasing in state corporate tax cuts over a multi year period, and has initiated a series of very large tax incentive programs for job creation.
    I’m not sure how comparable NJ tax policy has been to WI and KS, but it would appear to be similar, and be yielding similar results.

  9. Samuel

    Being in Wisconsin, the implications of this for Scott Walker’s campaigning is of interest to me. The last poll number I saw, indicated that 51% of Wisconsinites still considered Wisconsin’s economic performance above average. By most measures we would have to say it is below average and has been for awhile. Will the voters keep voting against the majority economic interests?

    Thanks Dr. Chinn.

    1. Bruce Hall

      Careful, Steven. I pointed that out in the previous tirade against Wisconsin and Kansas and got mocked for it. But here is some data that was just released for 2013 that show California’s GDP growth of 2.0% significantly outpacing Kansas’ growth of 1.9%. I keep thinking that when you are at the bottom of the ladder it is easier to go up than when you are near the top, but I guess that’s not the case.

      What is conveniently disregarded is the longer term results of policies within a state. California has been blessed with all manner of natural resources and great climate, but has managed to decimate [not quite annihilate] its agriculture through terrible water management policies. It has turned its back on expanding its oil and natural gas resources. It has made itself a politically-correct refuge for all manner of non-productive citizens and illegals. But somehow Kansas is “suffering”. Not!

      1. Menzie Chinn Post author

        Bruce Hall: I am thankful that you didn’t bring up minorities (but, true to form, you brought up “illegals” — you never cease to disappoint). Nonetheless, you are comparing growth rates going from 2012 to 2013, and we are now in the 2nd half of 2014. Gee, I wonder if we have a more up to date tracking on economic activity. What could that be, what could that be…oh, it’s the Philadelphia Fed’s coincident indicators– exactly the thing I have been highlighting. And if you were to consult the documentation for these indices, you would find out that their trends are calibrated to match real GSP over time.
        So, let me re-draw your attention to Figure 2. What is the Kansas trend relative to the United States? So referring to 2013 growth rates relative to 2012 is, while not wrong, pretty backward looking. Which in this context I do not find surprising.

        1. Bruce Hall

          Menzie, I know it is not politically correct to point out that certain groups are less educated and less productive and less employed, but this is supposed to be a discussion regarding economics and to disregard the impact of those groups on specific states/regions is a bit self-deluding. California is fortunate to have the “Silicon Valley” and a relatively large Asian minority to offset some the effect of poorer performing groups. http://nces.ed.gov/programs/digest/d13/tables/dt13_104.20.asp

          And yes, the data released on June 11 does compare 2013 to 2012, but so what? By nearly all measures, Kansas has been and is outperforming California… log chart notwithstanding. You are well aware that “blips” happen all the time… such as a negative 2.9% national GDP rate for the first quarter 2014 despite Keynesian pump priming through virtually giving away money by the Fed.

          I will grant you that Kansas is having less tax revenues than projected for the first 6 months of this year. Michigan went through a similar process and is enjoying a surplus now. There are few economic switches that produce both short-term and long-term results. We have enjoyed the results of the President’s policies with an agonizingly slow 5-year recovery while building a massive national debt. Sure, it was Bush’s fault. It will be Bush’s fault until Hillary finishes her second term. Yes, government can prime the pump, but if the pump is faulty you’re going to do a lot of priming for a long time.

    2. Menzie Chinn Post author

      Steve Kopits: Please, please, please, consult an econometrics textbook, or at least Wikipedia for the term, individual-specific “fixed effects”. From 1976M01 (beginning of monthly state-level data) to 2010M12 (just before Brownback, Walker, Brown), Kansas’s unemployment rate fixed effect was -1.64 ppts, Wisconsin’s -0.86, and California +0.91 (relative to US). So if you are going to compare the efficacy of policies on the unemployment rate (personally I prefer employment levels or economic activity), then at the very minimum you should account for these fixed effects.

      1. Steven Kopits

        I need to consult an econometrics textbook to quote BLS statistics?

        I checked the statistics because I knew that Kansas has benefitted in part from the shale revolution and is an ag state as well. Therefore, I suspected that the unemployment rate there had to be pretty low. And it is. The oil and gas producing states have done well, as you yourself have pointed out. (North Dakota has by far the nation’s lowest unemployment rate.) However, expectations for Kansas hydrocarbon production have fizzled a bit. Still, I think a 4.8% unemployment rate is really very good. I don’t know what exactly your metric of ‘full employment’ should be, but Kansas is pretty close.

        I am all for low taxes, but my preference is value for money. Bad fiscal policy is not the same as value for money, and that’s as true in Kansas as anywhere else. There’s more to it than just ‘low taxes’ or ‘high taxes’. Having said that, governments do not have an incentive to maximize sustainable prosperity. I have written about the FAA before; I will write about it again. If you want to maximize growth, pay for it. (And let me concede up front that I don’t know what tax rate is compatible with that; nor do I care.)

        Having said that, in many places, taxes are not competitive. Philadelphia, for example, wanted a $2/pack tax increase on cigarettes to fund schools. The state has turned them down. Cities like Philadelphia, Baltimore, DC and Detroit have to understand that they have to compete for residents. At some point, your ability to tax is capped, and you have to make do with a fixed level of taxes. The more you raise, the more you erode your tax base. Philadelphia is a corrupt, incompetent cesspool. Why would a non-Philly PA resident want to subsidize that? It’s time for Philadelphia, and cities and states like it, to understand that they are operating under constrained budgets and that they have to produce better value for money to retain or regain political legitimacy. And that will involve reduced long-tail obligations for retired public sector workers, a material reduction in the power of public sector unions, a big increase in charter schools, and paying market rather than prevailing wages, among other policy changes. They have to provide value for money, and they’re not doing it now–in significant part because the incentives are not aligned.

        If we return to the BLS list, let’s see where some of the high tax or heavy union states are:

        – New York 6.7% (37th)
        – New Jersey (my home state): 6.8% (38th)
        – Connecticut: 6.9% (41st)
        – Oregon (give me a minimum wage!): 6.9% (41st, tie)
        – DC, Illinois, Michigan: 7.5% (tie, 44th)
        – Rhode Island: 8.2% (50th)

        Now, unemployment rates are a function of many factors. But to tell me that California at 47th is a paragon of virtue and Kansas is a loser at 13th, well that defies imagination.

        If you have specific policies for, say, Wisconsin, that you believe would increase employment or economic performance, let’s discuss them. But this Oh-see-Scott-Walker-is-a-bad-guy-stuff, well, I have no patience for that. Your state-level posts are essentially destructive, not constructive. It’s all about throwing grenades over the parapets. It is low quality stuff.

        When you want to take the time to thoughtfully review some specific policies, weighing pros and cons, I am happy to consider those on their merits.

        1. Menzie Chinn Post author

          Steve Kopits: No, a monkey could cite BLS statistics. To understand what they mean requires context, and context in this case includes what the historical relationship between state specific unemployment rates and national rates is. Otherwise, we would always be running pooled time series cross section regressions instead of (sometimes) running fixed effects regressions.

          Technically, perhaps slow moving fiscal or union membership variables pick up the fixed effects. However, if you make the comparison, and those variables do not pick up those fixed effects (e.g., structure of economy, demographics, etc.), you will adduce to your other explanatory variables those effects if those other variables are correlated with the fixed effects.

          So, by all means, cite away. But, as in our previous discussion of chain weighted indices, it might perhaps possibly maybe behoove you to investigate the concept of fixed effects, and how one deals with them in statistical terms (one doesn’t have to necessarily do fixed effects estimation; diffs-in-diffs is another approach).

          1. Steven Kopits

            I’m sorry. I thought Figure 1 implied that you thought California was a well run state, and Kansas was a poorly run state. If that’s the case, let me disagree. Unemployment figures suggest that California is a very, very poorly run state; and Kansas is a pretty well run state.

            But the economy in Kansas is going to be heavily influenced by agriculture, oil and gas on the margin. That’s true for the surrounding states as well. California’s economy has different drivers. Energy and ag producers–which are linked to the Chinese economy or fracking–have done well, until China entered some sort of quasi recession about a year ago. Now commodities producers–Brazil, Australia, Canada–have had some of the wind taken out of their sails, particularly in the last year. How have you accounted for this?

            How have you accounted for the impact of low nat gas prices, which have tended to displace natural gas production around the country in favor of Marcellus production? (Production in Kansas continues to fall.) How have you accounted for flat oil prices and increasing E&P costs? (Oil production peaked there a year ago.) How have you accounted for flat oil prices and low nat gas prices on the manufacturing and coastal states, which tended to perform poorly when energy and commodity prices were high and rising?

            How have you accounted for the existing level of unemployment? In 2010, unemployment in California was 12.4%; in Kansas, it was 7%. Now it’s 7.6% in California; 4.8% in Kansas. Do you think unemployment should have dropped 5 percentage points in Kansas, as it did in California? Is that reasonable? Tell me what unemployment rate in Kansas is consistent with it having kept up with the US. What is it? 4%? 3%? 2%? Is that easy to achieve? Should Kansas consider a 4.8% unemployment rate a failure of policy? Then what’s a success? Say, fifth place, 3.8%, tying it with Wyoming and South Dakota? Could Kansas close the gap to US performance with only a 1.2% decline the unemployment rate?

            Did you take into account the impact of swine virus on Kansas? (http://fox4kc.com/2014/04/10/swine-virus-outbreak-affects-pork-industry-in-missouri-and-kansas/) How about declines in the cattle stock?

            Why is Missouri worried about tax competition from Kansas, if it has no effect? Why is Missouri considering similar tax breaks?

            Or maybe we should take a different approach. Why not explain the mechanism by which Brownback’s policies have changed the trajectory of the Kansas economy and the policies which should be instituted, and the magnitude of effect you anticipate. What do you think Kansas should do?

          2. Menzie Chinn Post author

            Steve Kopits: Well, as far as overall managerial efficiency goes, I have no particular opinion. But if you are asking me if slash-and-burn fiscal policies (cut taxes anti-progressively, cut spending commensurately) or balancing the budget using a combination of tax increases and spending restraint is better, I pick the latter (California).

            You are right, there are many other factors, and had I time, I would collect up the economic indicators, and run a regression and determine the impact of each of the factors you mention. But I don’t, so let me just observe: according to the Kansas Department of Commerce (please verify for yourself), in 2012, a total of 3.9% of gross state product originated in agriculture. For mining (including oil and gas production), the share was a massive … 1.2%. And you are telling me that these factors dominate in the variation in Kansas economic activity? Well, maybe. Whatever is true, the “adrenaline shot” that Governor Brownback promised with the implementation of the 2013 tax cuts has not yet resulted in a closing of the gap with the rest of the country; rather it has occurred in a conjunction a widening of the gap between Kansas and the rest of the country.

          3. Nick G

            oops – that should have said “bottomed out in 2002″.

            It’s fascinating to note that Kansas oil production bounced up in the early 80’s in a lagged fashion after the price of oil bounced up. Kansas oil production appears to be more price sensitive than that of the country as a whole!

          4. Menzie Chinn Post author

            Bruce Hall: Demographics is fine. I just think bringing up bugaboos like high minority concentrations — or high “illegals” concentrations — causing slow growth should be based in fact. Or else high minority states like California would be growing slower than Kansas — which let me just tell you in per capita or total inflation adjusted terms is not the case (on a five or ten year trend basis).

          5. Steven Kopits

            Alright, let’s define “slash and burn” in Kansas.

            Tax Revenues ($ millions, FY):
            2012: 6,610
            2013: 6,245, +1.4% over previous year
            2014: 5,873, -6.0%

            2012: 6,098
            2013: 6,166, +1.1%
            2014: 5,964, -3.3%

            I’m not sure I would define -3.3% as ‘slash and burn’, but it’s surely a marked step towards smaller government.

            I’d note that Barro writes:

            ‘In 2012, Kansas lawmakers passed a large and rather unusual income tax cut. It was expected to reduce state tax revenue by more than 10 percent, and Gov. Sam Brownback said it would create “tens of thousands of jobs.”’

            This 10% number is not evident in any budget I could find. Tax revenues for FY 14 are projected down -6%, total revenues are projected down -4.3%. There is no 10% figure in the FY 13 or 14 budgets that I saw. And FY 13 was up on FY 12 on both the revenue and expense side. I think sizing tax changes is always going to be a challenge; it is certainly possible the administration there under-estimated the revenue impact of tax changes, even though a decline of $372 million was budgeted. They may have to re-visit this issue.

            Creating “ten of thousands of jobs” in a state with a labor force of 1.5 million and unemployment of 4.8% is no mean feat. One percent of the labor force is about 15,000 jobs, and labor force is declining by 0.5% per year. Maybe you could push the unemployment rate down another percent or so. But the employment to population ratio in Kansas is already much higher than its comp group: 64.5 percent vs 59.7% in MO or 56.4% in California. So that’s a net of about another 15,000 or so jobs max that the economy there can take, if I believe what I see. That would bring unemployment a year hence to about 3.3% (allowing for a shrinking labor force), which would make Kansas tied for second in the unemployment rate with Vermont. Put a fork in it: Kansas is done for employment gains at that point, and frankly may be just about at full employment right now. The “ten of thousands of jobs” is hyperbole, at least on a net basis.

            At the same time, Kansas is highly dependent on a few companies. Sprint, for example, employs 8000 people–half a percentage point of employment all by itself. So you want to be darn sure that your key employers stay happy, and you know what their priorities (services vs low taxes) are.

            For a small state like Kansas, attracting key employers is very important. But at this stage, I think a larger employer would have significant reservations about opening a major facility there. I would guess some HR diligence would suggest that hiring people in the hundreds in Kansas, particularly those with skills, could be potentially quite challenging and expensive. Kansas is doing well. That’s what the numbers indicate, and they also suggest that the state will struggle to attract significant new inward investment from non-incumbent employers.

            As for reducing the budget for its own sake: I am a small government guy, and I have to admit to being impressed by a governor will to put his money where his mouth is. A down-payment of 3.3% is a real commitment. Let’s see where it goes over time. Let Barro and Krugman scream all they like.

            At the same time, I think Kansas should use its period of prosperity to possibly upgrade its capabilities to increase its appeal to higher tech industries. How one does that is a matter of understanding the situation on the ground, which I can’t claim to do. Let’s see where smaller government takes Kansas. I have no problem positioning Kansas as The State for People who Work. If you want to live on social insurance, California is happy to take you, and the weather is better there, too. And of course, high unemployment represents good governance as well. We know because Menzie told us so.

          6. Menzie Chinn Post author

            Steve Kopits: Look to page 13 of the FY2014 Comparison Report. FY 2014 (which just ended) is 3.1% lower than FY2013; FY2015 will be 0.6% lower than FY2013. But what is more interesting is the real spending trend; since the CPI-Midwest rose 1.6% (y/y through May), then real spending fell 4.7%. Even more telling is that nominal economic activity probably rose about 3.6% through May (change in Philadelphia Fed coincident index plus change in CPI-Midwest). So that is a drastic fall in spending, proportionately.

            More important is the need for government services relative to what is being spent. Poverty rose from 13.6 to 14.0% going from 2010 to 2012. [1] He cut welfare rolls, increased restrictions on access to SNAP. He also declined expansion of Medicaid, which would have had zero budgetary cost to the state in initial years, which will mean 100,000 people who otherwise would have been covered will not be as of 2016 [2]

          7. Menzie Chinn Post author

            Steve Kopits: I didn’t say we should take Medicaid away from the employed. But you wrote (and I quote verbatim):

            …SNAP and Medicaid. These are programs for People Who Do Not Work.

            I thought it only fair to set the record straight. You want to believe all people on assistance are the undeserving poor, and even if you occasionally make caveats, this comes out clearly in your writings (why else capitalize?).

            I meet minimum wage workers every day — each time I go to a fast food restaurant, my guess is that there is at least a 50% probability that the person serving me is at minimum wage. Maybe you don’t have to rub shoulders with the likes of such in the rarified locales you frequent.

          8. Steven Kopits

            “You want to believe all people on assistance are the undeserving poor”

            There’s always going to be a tension in policy between support and accountability; between helping out and wasting money; and between compassion and underwriting anti-social behavior; between self-reliance and dependence. It’s a question of where you draw the line, and the voters of Kansas have elected to draw it tighter.

            To my mind, neither I nor anyone else has a God-given right to the income or assets of others. If the voters decide to provide more, that’s their prerogative, as is their prerogative to provide less. I do, however, believe that the first and foremost role of government is to provide sustainable prosperity for the community as a whole, not for any given member of the community.

          9. Nick G

            To my mind, neither I nor anyone else has a God-given right to the income or assets of others.

            Wow. Really? Not even small children? How about veterans with serious injuries or service related disabilities?

        2. Steven Kopits

          Brownback appears to have made a statement about the strategy and position of Kansas: The State for People who Work.

          The employment to population ratio there is 6 percentage points higher than the national average and the unemployment rate is among the very best. You see that as failure; I see that as success.

          You’re claiming that the governor is cutting payments for SNAP and Medicaid. These are programs for People Who Do Not Work. I hardly see how cutting these programs would hurt the state’s competitiveness. Again, you see California’s comparative advantage as providing services to those not working. Let Kansas have its strategy; California can also have its own.

          Whether due to Brownback or other factors, Kansas is doing very well. Six more people in every hundred are working there than in California. That’s a phenomenal gap.

          So, that’s where we differ in ideology. For me, the purpose of government is first and foremost to provide prosperity and common services. You believe the principle role of government is to redistribute from the have’s to the have not’s. Those are enduring differences of values. You’re an egalitarian; I’m a classical liberal, first and foremost.

          1. Menzie Chinn Post author

            Steve Kopits: You write Medicaid and SNAP are for…

            People Who Do Not Work

            I’ll remember that the next time I meet a minimum wage worker who is on SNAP. I guess it’s their own fault that they didn’t hold out for a higher paying job. If only there were poor-houses! Those kids — they should be in the factories, too! They aren’t working…

            Medicaid… only people who don’t work collect Medicaid?

            Finally, you cite the point that Kansas has a employment to population ratio (not controlling for age distribution, etc.) that is 6 per 100 higher than California. Well, I tried to replicate that figure. I obtained the civilian employment figures from the BLS (May 2014 release), divided by the quadratic match interpolated annual population figures available through FRED (through 2013). I find that over the period 1976M01-2010M12, the average difference (also known as a fixed effect) for Kansas vs. California is 3.7 persons (Newey-West estimate of standard error = 0.25 ppts). The gap in 2013M12 is 4.3 — so if there’s a big jump in relative performance, it’s just barely statistically significant, and not economically large relative to the fixed effect.

          2. Steven Kopits

            Would you be happier if I said that Medicaid should only be taken away from people who don’t work? I doubt it.

            And how many minimum wage people do you hang around with, anyway? If you really cared about these folks, you’d be a hell of a lot more innovative, flexible and thoughtful about your policy suggestions. You’d be looking a lot harder at policies beyond redistribution.

          3. Menzie Chinn Post author

            Steve Kopits: Thanks — those are ratios for 2012. Since we have 2013 employment figures, I can estimate the corresponding ratios for 2013. I extrapolate 2013 population using a ten year regression of log first differences of population to estimate for Kansas. I then calculate the employment ratio dividing the civilian employment figures from the household survey by the state resident population; for the US I divide the corresponding employment figure by the mid-month population. These figures don’t correspond to the those reported in the KS website (in fact I cannot replicate the KS figure using the data reported in the first table that reports employment and population, suggesting it is an adjusted figure). But when I calculate the employment ratios using the same procedures, I find the fixed effect for Kansas vs. US (for 1976M01-2010M12) is 3.05, HAC standard error 0.14; the 2013M01-M12 gap is 3.01. In fact the KS employment to population ratio is declining through 2013, the year that tax-cut-fans allege is when we should be examining.

  10. Tom

    How about Illinois? Also, your previous 50 state comparison (that you cite in response to Pete) finds no relationship, so blaming the poor growth on ALEC-approved policies has now ascribed a meaningful relationship where your prior analysis found none. As you found before, some do well, some don’t. In other words, it is complicated. This simplistic comparison doesn’t add much other than vitriol.

  11. Ricardo

    Brownback bought into the Republican myth of any tax cut will stimulate the economy. I can’t tell you what he was thinking but my guess is that he was simply ignorant of what he was doing, as were the other Republicans who passed the tax plans. Even Laffer has made the mistake of understanding his own curve.

    Supply side growth comes from tax cuts when the tax rate is in the prohibitive range of the Laffer curve. You must not take this superficially. To better understand let me suggest you real Jude Wanniski’s book THE WAY THE WORLD WORKS.

    1. Menzie Chinn Post author

      Ricardo: Wow, Laffer does not understand Laffer.
      Hmm, let me try this. It seems you don’t understand the Laffer curve. The curve itself pertains to tax revenue, and tax rate reductions in a neoclassical model (absent backward bending labor supply curves) will result in supply-side increases in economic activity even when on the left-hand side of the Laffer curve. It’s just that in this range of tax rates, the increase in activity is not sufficient to offset the decrease in tax revenue arising from the decreased tax rate. That’s how I understand a Laffer curve. And yes, I read (and survived) Wanniski’s book.

  12. Glenn

    Clever choice of start year. The change in log-employment since 2011 is (unsurprisingly) larger in CA than KS. It is also larger in my home state, AZ, than KS. Missed entirely in your cherry picked analysis is the principal driver of this trend (hint: it has nothing to do with any public policy adopted in either CA or KS in 2011).

    CA, like AZ, suffered a deep contraction during the recession – performing significantly worse than KS. Unsurprisingly, CA has enjoyed faster growth coming out of this pit. However, viewed from a longer timeframe, suddenly things aren’t looking so rosy for the golden state, at least vis a vis KS!

    Nice try, though. One can draw whatever conclusions one wants if he picks his data carefully enough. That doesn’t make it so.

  13. Menzie Chinn Post author

    Glenn: Frankly speaking, I think your graph makes an excellent point for my case. I urge everyone to click on graph you provided. Note that from January 2010 through January 2011, growth rates in California and Kansas match — and are pretty close through February 2012. They then diverge, with California accelerating past Kansas. If the snapback is conditional on the depth of recession, why did it take until February 2012 for it to materialize? Inquiring minds would like to know.

    I have plotted the Philly Fed coincident indices for Arizona and California. Peak to trough, California fell about 7.4% (log terms), while Arizona fell about 16%. Yet California has grown (cumulatively) faster since the the last peak. So, I’m further confused about your snapback argument.

  14. Rick Stryker

    Sorry, but I’m still whistling.

    First, if we are talking about the effects of tax cuts, we have to get the time period right. The Kansas tax cuts started in 2013, and so you’re regression ought to set the dummy variable to start in Jan of 2013. It doesn’t really change the regression results, as you get a coefficient of -1.5% on the dummy variable (and it’s signficant), but this time period does matter for another important reason.

    That reason is, of course, that the Obama Administration’s Taxmageddon started in Jan 2013. Taxmageddon includes

    – expiration of the Bush tax cuts
    – expiration of the payroll tax cut
    – the AMT patch
    – expiration of stimulus tax cut
    – tax hikes from Obamacare
    – implicit increases in marginal tax increases from Obamacare
    – and others

    We need to think about Taxmageddon since otherwise how do we explain the fact that economic activity seems to have been de-stimulated following the Kansas state income tax cuts, especially when standard economic theories would predict no change or a positive impact.

    One way to see the effects of Taxmageddon is to run the same regression for a couple of neighboring states that are economically similar but did not execute the big tax cuts. If we run the regression for Iowa, we get a coefficient on the dummy variable (starting in Jan 2013) of -1.8% and it’s significant. If we run the regression on Nebraska, we get a significant -2.1% on the dummy variable. So Kansas with its tax cuts is actually been doing a bit better than its similar neighbors (but not all of them).

    I seem to have heard somewhere that we need to consider the counterfactual in these matters. What would have happened to Kansas in the absence of the tax cuts? And, channeling Krugman, isn’t the problem with the Kansas tax cut that it wasn’t big enough?

    Also, a comparison with California makes the effects look bigger than they really are. If I repeat the regression, but compare the US to California, then I get a significant coefficient on the dummy of -.8% for the US. California is doing significantly better than the country as a whole under Taxmageddon. We should really be comparing Kansas to the US to get a more realistic picture.

    If we do that, we will see that the assertion in the post that “Kansas lags the US economy significantly” isn’t supported by the regression. If I run the regression for Kansas against the US rather than California, I get a dummy coefficient of -.7%, and it’s not significant. Nebraska against the US is -1.2%, and that’s not significant either. Only Iowa has a significant coefficient of -.9%.

    Those numbers above set the dummy to start at Jan 2013. But if we start the dummy to start at jan 2011 when Gov Brownback comes into office, I get -0.4% on the dummy variable for Kansas and it’s not significant.

    To Ricardo’s point, not all tax cuts are equal. Many conservatives/libertarians did not think the Kansas cuts were optimal. It would have been better to broaden the base for example and perhaps not provide the corporate pass through. But the evidence does not suggest, I think, that the tax cuts failed but rather that they were too small to resist being overwhelmed by broader economic forces.

    1. Menzie Chinn Post author

      Rick Stryker: I would expect nothing less of you. For me, it’s not all taxes. Spending was also reduced. In particular, real per student spending on education was reduced by 16.5% going from FY2008 to FY2014. In other words, implementation of the Brownback agenda started in 2011, not 2013. January 2013 is just the beginning of the new tax regime. And in any case, aren’t you a believer in rational expectations? If so, then forward looking agents should have started reacting in 2012 (and if you aren’t, I’d like to get you on virtual paper to that effect).

      1. Rick Stryker

        I don’t see the big reduction in spending that could account for Kansas. You mention education statistics over 2008-2014 but Brownback has been in office since Jan 2011. Take a look at Table 7 in the State Expenditure Report which compares spending among the states for the years 2011-2013. You can see that although total spending on elementary and secondary education declined a bit in Kansas, that is explained by the drop in Federal ARRA funds from 2011, which is a common decline for the states. If you just look at the state spending component on education in Kansas while Brownback has been in office, it’s pretty stable.

        I do think that expectations of future policy changes affect decisions today. However, I wanted to focus on a time period in which the Kansas tax cuts and the Federal tax increases are aligned. We could also do your regression using a dummy starting in Jan 2011. If we do, the comparison between Kansas, Iowa, and Nebraska is even more stark. Comparing to California as you did originally, I get -1.6% on the dummy coefficient for Kansas as you did. For Nebraska, I get -2.4% and for Iowa -2.1%, both significant. Kansas’s performance has been relatively better than Iowa’s and Nebraska’s over Brownback’s full tenure in office, relative to California.

        I already mentioned that if we run the regression for Kansas with respect to the US with a dummy set from jan 2011, we get -0.4% and it’s insignificant. If we do the same for Iowa, we get -1% and it’s significant. For Nebraska, the coefficient is -1.3% and it’s significant. So, by that measure, Kansas has not been doing significantly worse than the US in terms of growth of activity since Jan 2011 but Iowa and Nebraska have.

  15. DJ

    Illinois has raised income taxes significantly. Since January 2008, employment has dropped by 5% compared to only a 2% drop in Wisconsin.

  16. Ricardo

    Your lack of reading compehension is sometimes hilarious – “Laffer does not understand Laffer.” LOL. To most I do not need to point out that I said that Laffer does not totally understand the curve that was named after him.

    It might be instructive to give a little history of the “Laffer” curve so that those who reason will understand. Art Laffer did not name the curve after himself. The curve was named after Laffer by Jude Wammiski. Laffer explained the concept, which is actualy as old as economics – Andrew Mellon consciously used it to create the prosperity of the 1920s. As Jude tells it, “I first watched Laffer scribble it on a cocktail napkin to demonstrate the idea for Vice President Dick Cheney, when Cheney was deputy chief-of-staff to President Gerald Ford in December 1974. Almost everything written has been wrong, in that reporters or critics of the Curve thought it showed an immediate response, where there would be no deficit increase in the 12 months following the cut. Laffer has not always been consistent and there have been times that he has made the mistake that Jude describes. Not all tax cuts are supply side tax cuts.

    It will be educational to read all of Jude’s article on the Laffer curve here

    If you wouild like a complete understanding of the supply side revolution of the late 1970s and 1980s that gave us the Reagan-Clinton prosperity read Brian Domitrovic’s ECONOCLASTS.

    1. Menzie Chinn Post author

      Ricardo: Let me quote exactly what you wrote:

      “Even Laffer has made the mistake of understanding his own curve.”

      Not “…Laffer does not totally understand the curve that was named after him.” If that is what you meant, you should have written it out. What else is the point of language? Any person reading that sentence would take the interpretation I took. I knew the story you allude to, but still did not know that is what you meant. Either you are very bad at communicating, or you are trying to rewrite what you said.

  17. Ed Hanson

    Julian Silk

    Thank-you for attempting to bring real Kansas economic analysis into the discussion. As you noted the causes of its slow growth but good unemployment rate is not just fiscal policy by the state government, but uncontrollable factors which effect major contributors to the state economy.

    To repeat and perhaps expand on some of your points.

    Not only are wheat prices down severely, the Kansas spring wheat crop was quite poor. It is a double whammy of low price and low production.

    Cattle numbers are down more than they have been for a half a century. This is some what countered by high meat prices, but than again prices for feed components are also quite high.

    Since you seem to have a good reading of Kansas specific economy, could you, Julian, give further information on the other major economic sectors. For instance, the important aviation industry. How is it adapting to the continued international economic sluggishness. I suspect exports are down significantly.

    I live a state close to Kansas but get little real information.

    Thanks again,

  18. Ricardo

    After this I am going to stop picking at nits. Where did I say, “Laffer does not understand Laffer?” Did you mean the Laffer curve as I wrote? As you wrote, “If that is what you meant, you should have written it out. What else is the point of language?”

    Thanks for playing though.

  19. Menzie Chinn Post author

    Ricardo: I am going to quote you verbatim:

    “Even Laffer has made the mistake of understanding his own curve.”

    Maybe the Econbrowser readership understands it your way, maybe not. Let’s take a poll…

    1. XO

      Well, the broader point Menzie is why waste your time? The graph you posted (and all the other ones) speaks for itself. Brownback and Walker contracted spending in a recession, and its effect on the economy was contractionary compared to past performance. Brown did the opposite in CA, and the effect was the opposite. That should settle it for sane people. Why spend your valuable time arguing with ideologues? They can say spending cuts were not enough, or not correct or anything to continue the argument.

      Just keep posting the new data, it is all you have to do to convince the persuadables.

    2. baffling

      menzie, just a case of ricardo trying to rewrite history. he does it time and again. he is cute when he gets all huffy though :)

  20. Manfred

    I followed with great interest your exchange with Steven Kopits.
    You say: “To understand what they mean requires context, and context in this case includes what the historical relationship between state specific unemployment rates and national rates is. Otherwise, we would always be running pooled time series cross section regressions instead of (sometimes) running fixed effects regressions.”
    You also mention that “From 1976M01 (beginning of monthly state-level data) to 2010M12 (just before Brownback, Walker, Brown), Kansas’s unemployment rate fixed effect was -1.64 ppts, Wisconsin’s -0.86, and California +0.91 (relative to US). So if you are going to compare the efficacy of policies on the unemployment rate (personally I prefer employment levels or economic activity), then at the very minimum you should account for these fixed effects.”

    My question is: the number -1.64 for Kansas and -0.86 for Wisconsin, how do you interpret that? What exactly should I do with that number?
    Say I would like to calculate the number for Louisiana, the state I work for; what exactly is the regression?
    If you have suggestions for further reading, especially in the context of state data, that would be great – thanks.

    Have mercy, Menzie, I cannot read every entry in every blog with every comment – I am asking honestly to educate myself.

    1. 2slugbaits

      Manfred Just add the fixed effect value to the intercept. So Kansas starts out with an inherently lower unemployment rate relative to the baseline case for reasons that are peculiar to Kansas and unrelated to anything that Gov. Brownback did or did not to. Think of it as a handicap in golf.

  21. Tom M.

    I just want to commend this blog for doing such important work. Remember, the only way the Republicans can even remotely get people to support their anti-worker agenda is if they can convince them it will be worth it by increasing wages and employment. Showing liberal states like California kicking the shit out of conservative states like Wisconsin and Kansas will make this much harder on them. Hence, their hysterical reactions to your posting of FACTS.

    1. Menzie Chinn Post author

      Steve Kopits: Well, let’s see, I understand how BEA calculates the shares. It divides value added by gross state product (which is the sum of value added in all sectors in the state) to obtain the number. I do not know how the Kansas Ag Sec calculated his figure, but I suspect he took total output and divided by state gross state product. Gross farm income was $15 bn in 2011, Kansas GSP in 2012 was about $140 bn, so at least we are in the ballpark of the 19% figure. I know what I learned in graduate school was the right thing to do, and it is not (apparently) what the AgSec did (I think that is why he used the word “accounted”). If you have a new treatise that says it is correct to divide total output by the sum of sector value added in a state, I would welcome learning of it.
      So…I’ll stick with 3.9% as reported in the Kansas Department of Commerce website.

      1. Nick G

        In the table “Kansas Employment by Sector”, where is agriculture? Non-durable manufacturing?

        1. Menzie Chinn Post author

          Nick G: These data are from the establishment survey, which pertains to nonfarm payroll employment. No agriculture. The AgSec must have obtained the data from another source.

      2. Menzie Chinn Post author

        Steve Kopits: I take it by your silence on the matter you agree that dividing total agricultural sector output by GSP is not correct. I further take it that 3.9% is a more accurate depiction of the role of agriculture in the state than 19%. Then I further take it that it does not seem appropriate to blame the “going off the rails” of Kansas employment depicted in Figure 2 on changes in agricultural commodity prices.

        Thank you in advance for your time and consideration.

        1. Steven Kopits

          In my experience, Menzie, departments representing various constituencies will tend to color the numbers the way that suits them. I suspect the Ag Dept numbers reflect a broader measurement of agriculture to include dependent activities like processing, transport and related construction, etc. I think the Dept of Commerce has the opposite bias. They want to show Kansas as something more than a cowtown, so they de-emphasize everything ag. Agriculture does not even figure in their list of “Key Industries”. You wouldn’t know, for example, from the Dept of C website that Kansas has the third largest beef herd in the country.

          I suspect that agriculture is indeed important in Kansas, and that agriculture and supporting industries do account for 15-20% of output there. And given that agriculture has been a hot sector, I’m not sure how to interpret Barro’s “non-farm employment” graph. In what sense is farm employment not relevant in Kansas?

          Take a look at the Kansas Dept of Labor website (below). Note the “Overview” excel spreadsheet on the right. This notes that as of May 2014, Kansas added 23,913 employed individuals (yoy), and of these, 15,700 were “Nonfarm Jobs”. Perhaps I’m reading this wrong, but if I do the math, then 8,213 jobs were by implication “farm jobs”. And this is seasonally adjusted data. So if I added 8,200 farm jobs, that’s more than 0.5% off the unemployment rate right there. If I understand this correctly, then farm jobs are very, very important in Kansas.

          By the way, not answering doesn’t mean I agree. It means I’m actually doing work I’m supposed to be doing (writing a book on supply-constrained oil markets forecasting) rather than screwing around with Kansas data. Now if you want to debate the outlook for driving trends in the US, well, that’s my hot topic this week. And it’s fascinating.

          1. Nick G

            hmmm. I read your source as saying “”Kansas gained 12,400 private sector and 11,900 nonfarm jobs since May 2013, “. So, 500 jobs out of 12,400 were farm, or about….4%.

          2. Nick G

            That was the change, year over year. Now, the absolute numbers are:
            May Employed Individuals 1,427,872
            May Nonfarm Jobs 1,383,300
            May Private Sector Jobs 1,127,600

            So, perhaps we do need to subtract Nonfarm from Employed to get Farm Jobs. That suggests that Farm Jobs equal 44,572, or 3.1% of all employment.

            I think there must be something wrong with their “over the Year Change” stats: it’s hard to imagine growth of 8,100 jobs on a base of 45k.

  22. Bruce Hall

    Menzie, your assertion that the demographic makeup of California is essentially irrelevant with respect to GDP is nonsense. California has every conceivable advantage in terms of climate and natural resources, yet is plagued by policies and demographics that continue to hold it back.

    While attracting a significant segment of highly educated people… which should propel California to the top of national economic indicators, the hispanic/illegal population [census includes illegals by race/ethnicity] lags far behind in this category http://www.ppic.org/main/keystat.asp?i=1264#2. This lower educated segment is also more likely to be unemployed and on welfare https://docs.google.com/viewer?url=http%3A%2F%2Fwww.calmis.ca.gov%2Fspecialreports%2FCA_Employment_Summary_Table.pdf. Other sources will show that this segment is also less likely to own a business http://quickfacts.census.gov/qfd/states/06000.html.

    Now, I’m not going to go through every state and attempt to delineate all of the possible factors… you can get a grad student to do that for you. But the so-called “bugaboo” you mentioned does appear to have real economic impact. The “bugaboo” would seem to be the prohibition to discuss this without ad hominem retorts. Education levels affect the resilience of a state; Wisconsin is less educated than Minnesota. Ethnic/racial mix on a state and national basis affect educational outcomes.

  23. 2slugbaits

    Menzie In your regression you included a trend variable in order to satisfy Bruce Hall. But the statistics you report do not show that the trend variable is significant. When I run the regressions in the usual braindead OLS fashion I do get a statistically significant trend; however, correcting for HAC robust errors (Newey-West) the trend variable fades into insignificance. So I’m assuming the numbers that you are reporting reflect robust error corrections. The problem is that if I rerun the regression without the insignificant trend, then the Brownback dummy variable is not significant either.

    The naïve regressions show a fair amount of positive autocorrelation. Also, the residual for Jan 2009 is an obvious outlier. It’s huge. Ah, the joys of OLS!

    Rick Stryker run the regression for Kansas with respect to the US with a dummy set from jan 2011,

    I don’t think this is what you really meant to say because the way it’s worded it sounds like you used an impulse dummy for Jan 2011 only. My take is that Menzie was setting a level shift dummy variable. The dependent variable does not show any evidence of a unit root, so you probably don’t want to model Brownback’s regime as an impulse dummy. But like I said, I don’t think that’s what you actually meant to say. I think you meant setting the dummy from Jan 2011 thru May 2014.

    Regarding the Kansas vs Iowa regression. When I crunch the numbers without the trend (remember, the trend was supposed to capture California’s mismanagement so it’s not relevant here), I come up with a Brownback dummy of -0.6%. It is just off the edge of significance at the 5% (p-value = 5.46%). Running the numbers for Nebraska I found the dummy as not being significant at all. But then again, Iowa and Nebraska both have idiot Republican governors who are probably just as clueless as Brownback, so there you go.

    1. Menzie Chinn Post author

      2slugbaits: Yes these regression results are not robust to changes in specification. I figured better to include the time trend just to guard against omitted variable bias.

    2. Rick Stryker

      Yes, I was running the same regression Menzie did, setting the dummy to 1 for Jan 2011 to the present.

      I thought there was some justification to include the time trend in both the US and California regressions, since the state coincident index for each state is designed to grow at the same rate as each state’s GDP in the long run. The time trend could capture other variables that might account for differences in growth rates.

      1. 2slugbaits

        Rick Stryker I don’t disagree that there might be very good reasons for including a time trend, although in this case the dependent variable is in first differences and there’s no obvious reason why you would need one. You might, but it’s not immediately obvious. It would take some additional diagnostics. In any event, I was simply pointing out that Menzie’s reason for including it in the KS/CA regression was to account for “the alleged poorly run policies of California” according to Bruce Hall. Of course, the possibility of omitted variable bias is also a good reason. On the other hand, there are lots of other problems as well, including significant autocorrelation in both the residuals and the squared residuals. Not exactly unheard of in time series data.

        1. Rick Stryker

          Just to clarify, I kept the time trend for the same reason that Menzie did. Sorry if that wasn’t clear.

          There are almost certainly variables that could explain the difference in growth rates and these variables are likely correlated with the dummy variable. If we just omit these variables entirely and just estimate the coefficient on the dummy variable, we can’t trust the dummy variable estimate since we should expect it to be biased and inconsistent. However, in the absence of knowing what additional variables to put into the regression, Menzie’s choice of a time trend is sensible, but obviously not optimal. However, Menzie was just trying to get something quick and dirty going that made some sense.

          I don’t think you just want to drop the time trend. The way to improve the regression is to come up with some alternative explanatory variables to replace the time trend.

    1. baffling

      this of the steve moore wsj who has argued for 6 years that we need to raise interest rates immediately to beat back the bond vigilantes who will raid the bond industry!

      hans, you may not like krugman. but do you understand how utterly wrong laffer and moore have been during the great recession? there is no beating around the bush, excuses, etc. these guys have been WRONG for years, and anybody who is still listening to them is a fool-and broke!

  24. Bruce Hall

    I’d suggest that you refer to California’s own assessment of its changing population and the impact on its educational attainment … and economy. Refer to pages 15 and 16. http://www.cpec.ca.gov/CompleteReports/ExternalDocuments/Adding_It_Up.pdf

    California must address racial and ethnic disparities in the percentage of college-educated
    adults, particularly with respect to Hispanics.”

    I presume there is adequate correlation for their concern with Hispanics to soon be the plurality in that state.

    You can also examine the differences in educational attainment between Wisconsin and Minnesota in this document. You know, of course, that higher educational attainment equates with lower unemployment and more robust economies.

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291 Reviews For Long John Silvers Headquarters & Corporate Office

pot heads

whent to the Muskegon Michigan ljs and the workers were out back smoking pot including a manager

A Recommendation

1. Add a 12 Shrimp Platter 2. Make the 1 Fish and 3 Shrimp a regular menu item.

No Compaint Just a Question!

I really like Long Johns But I wish it was separate by it's self again. Also wish you would sell your Tartar S. Retail!

shortage of food every time

we ordered the family meal and they only gave us half of what we ordered I have a wife and a hungry teenage boy to feed. half of the time we go to LJS we are shorted

poor service

I just left the van buren ar long john slivers. I had to wait forever through the drive thru. Not only did I not receive my drink I wasn't handed the receipt so I had to Google just to call an try an get my drink. The manager brushed it off like it wasn't her problem. Never spending another penny. Rude and very unprofessional.

tasteless food

tasteless meals. the fish taste like chicken. the chicken taste like shrimp everything is cooked in the same deep fryer. making everything taste the same. I'm never going back.

Most horrible experience of my week. The manager at the store on NW 23rd and meridian wasn't on the clock, so because I got animated when I complained, and he threatened to assault me. I am calling the police. Slowest food ever. I think that they may have to catch and kill the fish first

Pay check

I recently quit at long johns silvers and called on a Thursday and my final pay check and the manager was currently mad and me and said I can't come till Saturday so I come in on Saturday wasting my gas and turns out my check was lost and I need to know if I can get somthing in return with my check like gas money or a bonus

Disgusting worker

There was a worker laying on a counter in the N Belt location in St Joseph MO. There was a picture taken BY A MANAGER and posted on FB. It's spreading like wild fire. I can promise you no one who sees it will ever go there again! Myself included!

Disgusting Act of worker

My husband went into long John silvers located on Morgantown Rd Uniontown pa. 15401. Upon reaching the counter a woman was placing an order with the worker, when my husband noticed he had a large string of snot hanging from his nose the worker just swung his head to shake it off as he was already waiting on a lady. my husband turned around and walked out he said the lady he thinks followed. where are the managers at to over see these kind of disgusting workers you know they act like that in front of a customer they act just the same in front of all co-workers! we will never eat at long johns again. sherry of Uniontown

Unprofessional Management staff

We were in Lauderhill, Fla. having dinner and the Manager came out to the dinner room with an employee to write her up, we heard the hole conversation which was very unprofessional, the lady started crying, because she knew were we listening to the conversation, we will no longer be visiting this establishment due to the manager behavior

bad bussiness

Just came from LJS on mangum Rd in Houston. Only one person working there poor guy.waited 15 mins for my order also saw another car waithing. Got tired and left

Menu knowledge

My son in Kentucky advised me that LJS has a special for the entire month of Sept. I called the Staples store several times; received recording that it was not in service! I then called the Saratoga store, and the Manager could not tell me if they had that offering. I asked what they had on sale and was told she did not know!!!?? I told her what my Son had advised, she did not know of it and sounded slightly incoherent. They stores are in CORPUS CHRISTI, TX. The time is 3pm.

worst visit

Hi I visited your long john silvers in Peru, indiana Thursday sept. 4th I would just like to say it was the absolute worst visit ever first they had all these young snobby disrespectful people behind the counter they showed no customer appreciation. The food took over an hour to get to us and as I'm typing this I still have not received it! I've very disappointed and not looking forward to another visit.

lousy service and food

I went to the store in Pontiac, IL and had the worst experience. I attempted to contact corporation online and got messed with and unsuccessful. CONSUMER BEWARE. AVOID THIS FRANCHISE

racist chain

You advertised for the free fish fry today and when I attempted to Find a location I discovered all the participating locations were up north. They were for lack of better words all in white neighborhood's.I think that is awful. There is No explanation you can use or words to Say to explain this so called marketing strategy. You never intended to really give anything you only hoped to sell with the anticipation of offering something. This was a awful Find considering were eat there a lot. I will be telling anyone who will listen this story. We will No longer go to your establishment.

Bad store

Never go to long johns in melbourne fl. This was the worst experience I have ever had at this location. Under new management and employee was very rude and unprofessional. I will never ever eat at this store again and I suggest you don't either. Bad service, rude employee taking order and manager didn't care. I have been to this location a lot but never again. I always ring the bell when I leave but not thus time and always call the survey and give a good result but not this time.

thick cut cod

We go to the KFC/Long John Silver store in Ledgewood, nj But for the last year or so Long John Silvers no longer carries the Thick cut cod meal. Please bring the Thick cut cod meal back? This cod meal is so much better then the current fish meal because you get much more fish and less breading. Maybe it was not selling? But we loved it. Now we just buy the KFC chicken breast meal. Thank you

I just received an e-mail with LJS's coupons. They expire 8/25/14. Guess what today is....8/25 !!! We have been eating at store #32014 in Melbourne, Fl. since it opened many years ago. The food is not the same. The fish used to be thick with the most delicious crunchy airy coating and extra crunchies would be in the basket. Not anymore! We used to have to wait for a table. Not anymore!

Today, Sunday July 20, 2014 at the Rodi Road, PennHills, PA restaurant I had the worst experience I have known at a drive thru in my life. I paid for 4 meals and received 3 of them. The ones I received were not even correct. The workers were rude and we had to wait a ridiculous amount of time. I will not be back

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Now, more than ever, I'm reminded how important it is to keep close the people I love. My maternal grandparents Dottie and Eddie—or Mom-mom and Pop-pop, as I call them—are still with us today and for that, I'm so blessed. If you could meet them yourself, stay for dinner and hear their stories of a Life lived together, you'd know immediately the gifts they've passed onto me. From Pop-pop, a horticulturist for an estate in Greenwich, I learned to appreciate the beauty of flowers. And from Mom-mom, a homemaker in the purest, more inspiring sense of the word, I learned to cook, to bake and to take pride in creating a beautiful home

In her prime, Dottie loved to entertain, gathering friends and family every chance she got. She was a collector, too, of beautiful things for the table and used them often. Growing up, there was always one particular collection I loved, a set of pink swirl dishes from Anchorglass, a gift at her engagement party 60 years ago—and a gift she has since passed onto me.

Now these were Dottie's everyday dishes, so with time—and countless peanut butter and jelly sandwiches—they've since faded, their pink hue growing paler and more beautiful every year. But that's why I love them so much and continue to use them myself. 60 years they've been together, growing closer every year, so what better way to celebrate than by setting a joyful, summery table with the dishes she received so long ago? To start, there would have to be a big, beautiful cake with buttercream frosting made from farm stand eggs and local, homemade butter.

After baking and refrigerating overnight each of the four layers, I cut the crusts off from every side, leaving nice, even layers of yellow cake, ready to be frosted. Be sure to save the crusts for a toasted crumble over ice cream!

Mom-mom and Pop-pop share a favorite layered cake—buttercream on the outside with a lemon custard filling.

Here's the first coat of icing I did to hold in the crumbs, then let refrigerate until hard.

The final coat is much smoother, tinted pink like Dottie's dishes.

Next, using a pastry tip, I gave the cake a simple pearl edge of buttercream.

Then I went into the garden, gathering pink strawberry blossoms and pretty white roses inspired by vintage kitchen curtains from a thrift shop in New Orleans

I layered them like runners, topped with miniature strawberry arrangements in slag glass flower pots.

The finished cake I'd serve on Dottie's pink swirl plates, a perfect pairing to celebrate their 60 years.

But first, I thought I'd do a casual buffet on the porch of some of their favorite summer foods, served on vintage jadeite servingware at varying heights on the table.

Of course, everything I'd planned ahead of time, including another gift from Dottie—vintage red Bakelite flatware in a slag glass pot from a flea market in Lambertville.

The macaroni salad was Dottie's own recipe—her secret is chicken bullion—while the BLTs I made with peppered bacon, together with lettuce and tomatoes from the garden.

To make them feel more special, I cut the bread out with a biscuit cutter, brushed the pieces with olive oil, salt and pepper, toasted them in the oven, then rubbed them with garlic. It's an unexpected touch to an everyday meal just about anyone can do!

And finally, the best part of the day—Mom-mom and Pop-pop's favorite lemon buttercream cake, celebrating 60 years of marriage on the very same plates that started it all.

Life can change in an instant, but it's the memories we create that live on forever…


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Do School Districts Matter?

In Ohio, there are over 600 traditional school districts. Some are large (the largest is Columbus City Schools at nearly 50,000 students) and some are small (the smallest being the “island” district, Put-In-Bay, with 71 students). But do these entities—school districts—actually matter in relation to student achievement? That’s the question Grover Whitehurst, Matthew Chingos, and Michael Gallaher of the Brookings Institution examine, in the aptly-titled report, Do Districts Matter?

To answer this question, the researchers use student-level data from Florida and North Carolina for fourth and fifth graders, from 2000-01 to 2009-10. The researchers isolate the impact of the district on achievement, while controlling for the impacts of teachers, school-buildings, and student demographics in their statistical model. The key finding: School districts, in the aggregate, have little impact on student achievement, relative that of school buildings—and to an even greater extent—classroom teachers.

In addition to the aggregate district analysis, the researchers also consider whether some districts have a greater impact on achievement than others. Using data from 2009-10, they find that, indeed, there are districts that have strong positive impacts and districts that have negative impacts. The difference between an effective and ineffective district? Nearly a half year of student learning, according the report.

The report’s authors concede that they haven’t gotten to the bottom of why some districts are more effective than others. But, through this research, we have strong evidence that indicates there are great districts and laggard districts—and we’d likely find the same in Ohio’s collection of school districts as well.

SOURCE: Grover J. Whitehurst, Matthew, M. Chingos, and Michael R. Gallaher, Do Districts Matter? (Washington, DC: The Brookings Institution, March 2013)

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How Beats headphones changed the audio world

Hip-hop artist Lil' Wayne, wearing diamond-studded Beats headphones, sits courtside during the 2012 NBA All-Star Game.

Story highlights

  • Beats headphones dominate the $2 billion headphone market
  • The accessories are criticized by audiophiles over their marketing, bass-heavy sound
  • Beats president: We focus on premium audio and excitement of studio experience
  • Brand has spawned rivals; observer says audio quality is likely to improve a lot

Kelley Zapata loves her Beats.

The University of Georgia junior first got a pair of Beats by Dre Studio headphones for Christmas in 2008. They were a revelation, she says, especially for someone used to Apple earbuds.

"I was blown away," she recalls. She's since invested in two more.

She's not alone. The audio company's lower-case "b" is ubiquitous on the ears of listeners across the country, seen on celebrities -- Lil Wayne at a Lakers game, Katie Holmes on a movie set -- and college students.

Indeed, according to the NPD Group, a marketing research company, Beats controls 27% of the $1.8 billion headphone market -- and 57% of the market for "premium" headphones, ones that cost $99 or more. On- or over-the-ear Beats retail from about $200 to $400, so you can easily spend as much on the headphones as you can on your MP3 player or contracted phone.

That's a lot of "b"uzz.

But along with the popularity has come a backlash. Beats have been criticized for being a marketing gimmick, a bass-heavy fashion accessory not up to the kind of high-quality audio sound they promote. Zapata admits she was initially seduced by the pitch: "I'm a big Lady Gaga fan, and she had them in her music video," she says.

Producer and musician Dr. Dre wearing his Beats at a Boston Red Sox game in 2010.

For audiophiles, Beats are a sacrilege. They've filled up message boards complaining about the popular cans.

"(A) Timex with Rolex's price tag," wrote one responder to a board titled "Why the Beats hate?"

"To a lot of people, the fact that someone took our hobby and our industry and vastly perverted it to the public at large borders on offensive for a variety of reasons," added another poster.

But the audiophiles might be missing the point. What Beats has done, suggests Tyll Hertsens, is expand the market for better-quality headphones -- as witnessed by the countless headphone makers jockeying for space at the International Consumer Electronics Show in Las Vegas last week.

Building on the distinctiveness of Apple's white earbuds -- which announced their wearer owned a desirable iPod or iPhone -- Beats essentially created a new niche.

"What they did was brilliant," says Hertsens, editor of InnerFidelity, a site devoted to personal audio. "They somehow knew that people were aware enough of headphones that they could make them have some cachet."

And cachet, he observes, comes with a price.

"It used to be that a $250 price of headphones were expensive. Now that's just the norm. (Beats) raised the acceptable price of headphones," he says.

Audio quality and design

With that increased price has come a renewed awareness of both audio quality and design, says Hertsens.

"In the past three years or so, headphones have gotten a lot better," he says. They're on display and available for testing; people can walk into an Apple Store and truly hear the difference, he says.

Audiophiles always prized sound quality, of course. But the headphone brands they argued about -- brands such as Beyerdynamic, Grado (which has shunned advertising in its long history) and Sennheiser -- weren't widely known among consumers, particularly in an age moving toward convenience and away from component stereo systems. Along with the omnipresent Sony, perhaps the best-known name in the premium market was Bose, and Bose had its own detractors.

Few had eye-pleasing designs. The sound was what mattered, of course.

As Hertsens notes, what Beats did was change the formula. The brand dates back to the mid-2000s, when producer Dr. Dre and music mogul Jimmy Iovine were frustrated by their painstakingly crafted music being listened to through tinny earbuds.

In 2008, Beats put out the Studio, manufactured by Monster. The cans were an immediate hit.

The philosophy of the company hasn't changed, says Luke Wood, originally a consultant to Beats Electronics and now the company's president.

Digital production and technical advancements improved the sound of records but headphones were lagging, he says, thanks to a convenience culture put forth by laptops, earbuds and MP3 files. (Ironically, Wood observes, Steve Jobs "really cared about sound": "I don't think anybody at Apple thought those white earbuds were the end-all of premium sound.")

"With Beats, the idea was to take the energy and passion of how we market our music and marry that with a focus on premium audio and the excitement of what we hear in the recording studio," Wood says.

He's aware of the criticism, but points out that a fondness for certain elements of audio -- like music itself -- is subjective.

"It's really about point of view and taste," he says. He, Iovine and Dre have "all made hundreds of records and spent tens of thousands of hours in the recording studio," he says. "I think we have an educated point of view and a consistent point of view to sound, and I certainly think we come from a place where we know what we're talking about."

The value of competition

Beats competitors are now legion, and many have copied the Beats playbook in marketing their headphones.

There are headphones from 50 Cent (SMS, which also has a collaboration with Lucasfilm), Bob Marley's estate (House of Marley, which promotes an enviro-friendly aesthetic), Quincy Jones (manufactured by AKG) and Tony Bennett (by Koss). Lou Reed's last video was for the Parrot Zik, designed by Philippe Starck.

Even the low-key Grado now has a branded headphone, a collaboration with Bushmills Irish whiskey. Actor Elijah Wood and DJ Zach Cowie contributed to the design.

Monster, which no longer manufactures Beats, has launched a line with the producer Swizz Beatz -- a Monster investor -- called DNA. (Zapata, the Georgia student and Beats loyalist, says she's intrigued by them.)

NPD Group consumer electronics analyst Ben Arnold believes that, though the headphone market may be slowing from its double-digit growth of recent years, there's no sign of a crash. With December's sales, he expects 2013 to top $2 billion, and says sales should go up another 5-7% in 2014.

Hertsens remains lukewarm on Beats' audio quality. In a detailed "Celebrity Headphone Deathmatch" review a couple of years ago, he gave grudging marks to the Studio and deplored the slightly cheaper Solo. But he approves of the greater emphasis on design and expects the audio quality of headphones, as a whole, will improve.

"(Right now) there's nothing to compete against Beats when you're talking about, 'I'm going to give you style, I'm going to give you comfort, and I'm also going to give you sound quality,' " he says. "In a way we're indebted to Beats because they made more money available for manufacturers to compete in the marketplace and make better headphones."

Beats' Wood is planning on it. He says he's not worried about the competition, just maintaining Beats' quality.

"What we're seeing is this resurgence of premium sound. People really care and hear the difference," he says. "I think we'll see this, not just in headphones, but also in home stereos, in cars -- and ultimately the whole bar will be raised."


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Guest Blogger Angela Kiser: Self-paced Learning with BrainPOP

learning with brainpop

Check out this blog post on Self-paced Learning with BrainPOP!

Angela Nixon Kiser is a National Board Certified Teacher who works tirelessly to provide interactive and meaningful learning in a technology enriched classroom. She provides technology tips, fun, and advice through a collaborative blog called

New buzz words continuously emerge within our educator community. With the integration of Common Core, the words on everyone’s mind are ‘Flipped Classroom’ and ‘Self-paced Learning.’ Like every educator, I dive into researching what it all means only to realize that I have been doing some form of the flipped classroom for about three years now with my fifth graders.

My version starts with a few key ingredients; my Blackboard page, my curriculum, and BrainPOP. My self-paced learning portal started when I needed to provide my students with work that would keep them active and engaged, while I worked with my small groups. Instead of looking for center activities, collecting all the materials, or making copies, I was developing the Digital Natives’ version of centers via the internet. Life became so easy.

As I put together the unit of study, I immediately thought of my friends Tim and Moby. With great anticipation, I logged into BrainPOP and searched for related topics to the unit I was teaching.

BrainPOP videos are often the starting task within the content folder that my students are completing from week to week. I find the videos work well with the interactive games and activities my students must complete. I admit, I love hearing the whisper of, “OHHH, a BrainPOP video,” as they open their content folders. I notice my students watch the videos each day as they begin their required tasks, and return to them often as they acquire those skills and concepts.

When it comes to quizzes for the students, BrainPOP comes to my rescue again. The quizzes have been a great source of assessment into this endeavor of self-paced learning. When I began this process, I did question whether my students were truly learning the content. However, that question was quickly answered with positive scores my students were receiving on their quizzes. I found myself doing a happy dance as my students completed the quiz and printed the results. Analysis made easy!


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 Lanzopral (Generic name - Lansoprazole) Online Information

Lanzopral - General Information:

Lanzopral is a proton pump inhibitor which prevents the stomach from producing acid. It is manufactured by TAP Pharmaceutical Products. Lanzopral has been marketed for many years and is one of several PPI's available.

Drugs categories

PDF generator [Lanzopral]

Lanzopral - Pharmacology:

Lanzopral belongs to a class of antisecretory compounds, the substituted benzimidazoles, that do not exhibit anticholinergic or histamine H2-receptor antagonist properties, but rather suppress gastric acid secretion by specific inhibition of the (H+,K+)-ATPase enzyme system at the secretory surface of the gastric parietal cell. Because this enzyme system is regarded as the acid (proton) pump within the parietal cell, Lanzopral has been characterized as a gastric acid-pump inhibitor, in that it blocks the final step of acid production. This effect is dose-related and leads to inhibition of both basal and stimulated gastric acid secretion irrespective of the stimulus.

Lanzopral for patients

Lansoprazole is used short-term (4-8 weeks) to treat duodenal ulcer and erosive esophagitis. It may used long term to treat Zollinger-Ellison syndrome, a problem with too much acid being secreted. Lansoprazole capsules should be taken before eating. The capsules are delayed release meaning they work over time. The capsules should be swallowed whole and not crushed, opened or chewed. If you are taking theophylline, you may need your dosage checked when you start and stop lansoprazole to ensure your dose is effective. If you are taking sucralfate, it should be taken 30 minutes after taking lansoprazole. The most common side effects reported were diarrhea, nausea and abdominal pain. These occurred in fewer than 5% of patients. If your symptoms return after completing your course of therapy, talk to your physician for further evaluation.

Lanzopral Interactions

Lansoprazole is metabolized through the cytochrome P450 system, specifically through the CYP3A and CYP2C19 isozymes. Studies have shown that lansoprazole does not have clinically significant interactions with other drugs metabolized by the cytochrome P450 system, such as warfarin, antipyrine, indomethacin, ibuprofen, phenytoin, propranolol, prednisone, diazepam, clarithromycin, or terfenadine in healthy subjects. These compounds are metabolized through various cytochrome P450 isozymes including CYP1A2, CYP2C9, CYP2C19, CYP2D6, and CYP3A. When lansoprazole was administered concomitantly with theophylline (CYP1A2, CYP3A), a minor increase (10%) in the clearance of theophylline was seen. Because the small magnitude and the direction of the effect on theophylline clearance, this interaction is unlikely to be clinical concern. Nonetheless, individual patients may require additional titration of their theophylline dosage when lansoprazole is started or stopped to ensure clinically effective blood levels.

Lansoprazole has also been shown to have no clinically significant interaction with amoxicillin.

In a single-dose crossover study examining lansoprazole 30 mg and omeprazole 20 mg each administered alone and concomitantly with sucralfate 1 gram, absorption of the proton pump inhibitors was delayed and their bioavailability was reduced by 17% and 16%, respectively, when administered concomitantly with sucralfate. Therefore, proton pump inhibitors should be taken at least 30 minutes prior to sucralfate. In clinical trials, antacids were administered concomitantly with lansoprazole delayed-release capsules; this did not interfere with its effect.

Lansoprazole causes a profound and long lasting inhibition of gastric acid secretion; therefore, it is theoretically possible that lansoprazole may interfere with the absorption of drugs where gastric pH is an important determinant of bioavailability (e.g. ketoconazole, ampicillin esters, iron salts, digoxin).

Lanzopral Contraindications

Lansoprazole is contraindicated in patients with known hypersensitivity to any component of the formulation.

Lansoprazole delayed-release capsules are contraindicated in patients with known hypersensitivity to any component of the formulation.

Amoxicillin is contraindicated in patients with a known hypersensitivity to any penicillin. (Please refer to full prescribing information for amoxicillin before prescribing.)

Clarithromycin is contraindicated in patients with a known hypersensitivity to any macrolide antibiotic, and in patients receiving terfenadine therapy who have preexisting cardiac abnormalities or electrolyte disturbances. (Please refer to clarithromycin before prescribing.)

Lanzopral more info

Indication, Mechanism Of Action, Drug Interactions, Food Interactions, etc..
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