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Thursday, January 29, 2015

SCHMID: LOOKING BACK FROM THE LEFT COAST - JANUARY 27, 2015

BOTH ND SENATORS AGREED on one aspect of President Obama’s State of the Union address. Senators Hoeven and Heitkamp considered it ironic that Obama would emphasize oil and gas development, but hold up the Keystone pipeline. In an NPR interview, Heitkamp said that six years was more than enough time to study the pipeline. Hoeven was concerned that the president talked “about higher taxes, more regulation and bigger government.” Heitkamp was more supportive of the president, but felt he neglected rural America and agriculture.
 
OUTRAGED, BUT VAGUE A Forum editorial pulled no punches -- it accused ND legislators of bullying Higher Education Board Chairwoman Kirsten Diedrich and causing her resignation. The editorial was unclear how the bullies achieved that result. The Forum defended Diedrich’s honor by awarding legislators “Leafy Spurge.”
 
THE BOARD IS THE PROBLEM In his weekly column, Mike Jacobs said “Diedrich had to go, of course. She was the rod that drew the lightning.” He said the problem with the ND University System is just this: “The board can’t exercise control because it refuses to let the chancellor do his job. So the presidents act on their own much of the time.” Jacobs said the role of the chancellor “should be to choose the presidents, to encourage and admonish them, to monitor their activity and to judge their effectiveness.”
 
A FAMILY OF ACHIEVERS Gaylord Olson (81) graduated from NDSU in 1957 with a degree in Ag Economics. He was a career farmer and a leader in the Buxton farm community. Olson retired in 1999 moving to Grand Forks in 2005. His obituary mentioned an older brother, but gave no hint of the brother’s prominence. Mancur Olson Jr grew up on the same Buxton farm as Gaylord and like his younger brother attended NDSU.
 
HE DESERVES A TEDDY Mancur went on to a Rhodes scholarship at Oxford and a Harvard doctorate in economics. His 1965 book, “The Logic of Collective Action,” received international attention and is considered his most important contribution to economics. His theories cross the boundary between economics and political science -- his 1982 book, “The Rise and Decline of Nations,” was his most popular publication. Mancur died in 1998 at age 66. An obituary then in The Economist magazine stated, that had he lived, his theory of collective action might well have won him a Nobel prize in economics. He is one of the most influential political economists of the late 20th century, yet relatively unknown in his home state. Mancur earned and deserves the highest recognition ND can bestow -- the Theodore Roosevelt Rough Rider Award.
 
CHICKEN FEED A Forum article discussed UND expenses related to changing its nickname, for example, the school spent $126,000 on a nickname committee. These expenses are chicken feed compared to the immense value and goodwill lost when the school caved in to the NCAA and abandoned the “Fighting Sioux” nickname. An example, in 2012, the year the logo and nickname were retired, the school received $692,000 in royalties for Fighting Sioux merchandise. If you estimated a simplistic value using a 6 percent cap rate, the royalty value alone was $11.5 million, and that was only one of many intangible values associated with the nickname and logo. Hindsight will increasingly show the decision to retire the nickname, without greater thought and negotiation, was short-sighted, even reckless.
 
GRIGGS COUNTY (Cooperstown) is a lesson in dysfunction. A $3.5 million County Courthouse and Emergency Operation Center is 90 to 95 percent complete, but has been idle for months because of squabbles between current and former commissioners. Contractors left the job in May because they had not been paid.
 
POOR AND GROWING Last November, this newsletter noted that a cluster of counties in north central Minnesota (home to several Indian reservations) are poorer, younger and have a population growing faster than the rest of the state. The cluster is somewhat of a time bomb, which, if not addressed, will limit economic growth and further strain public resources. This week the Executive Director of Minnesota’s Center for Rural Policy told a legislative committee the cluster is a “financial sore spot.” ND reservations are more scattered than those in Minnesota, but present a similar problem. The Ft. Berthold Reservation and its oil money are an exception.
 
THE ANNUAL STATE OF THE TRIBES ADDRESS was delivered to the ND Legislature by David Archambault, Chairman of the Standing Rock Sioux. His litany of tribal pathologies echoed those of many previous years. Archambault said only one out of ten Indian students is sufficiently skilled to enter higher education.
 
HOLSTEINS ARE EXPENSIVE ND has a variety of laws to protect “homeboys” from competition. At least one of those laws is biting back. In 2000 the state had 350 dairy farms, today there are only 90 -- only one in four remain. This is partly the product of a state law that allows only family members to have a farming corporation. A modern dairy requires an investment of several million dollars and may require a pool of investors. Commissioner of Agriculture Doug Goehring proposes to exempt dairies from the old law.
 
WILLISTON is scrapping a comprehensive plan developed in 2010. The plan assumed an eventual population of 30,000 -- a number the city has already passed. Williston is the nation’s fastest-growing micropolitan area.

DIRTY, DIRTY In the winter of 2013, scientists from the U. of Washington sampled snow in the northwestern U.S. The dirtiest area by far was in western ND. The pollutants were attributed to activities related to oil drilling and production plus airborne dirt believed to be raised by trucking activity in a winter of light snow.
 
TARGET CORPORATION A decision by the Minneapolis-based retailer to close its 133 Canadian stores will cost the company billions. How will this affect Canadian customer traffic to cities such as Minot and Grand Forks? The answer is a little surprising -- the CEO of the Grand Forks Chamber said that Target’s opening in Canada had little impact on customer traffic to Grand Forks and they expect about the same from the closing.
 
LIVING BEYOND 100 Selma Hermanson (103) was a prairie child born in 1911 in Kidder County (central ND). Her parents were homesteaders and Norwegian immigrants. Her older sister was born in a small wooden house that later became a chicken coop. By the time Selma arrived, the family lived in a house ordered from the Sears and Roebuck catalog. She was married 50 years, yet lived over 30 years beyond her husband. Her obituary said people who knew her “always received a smile and some ‘Tulle’ (Norwegian for ‘foolishness’).”
 
DAKTOIDS: The Korean parent of Bobcat gave NDSU the single largest scholarship endowment in the school’s history. The $3 million gift will provide scholarships to students in STEM (science, technology, engineering and math) . . . ND is the state with second lowest percentage (30 percent) of low income students receiving free lunches. New Hampshire (27 percent) is the lowest; the national average is 51 percent . . . The Grand Forks skyline is changing -- a 4-story, $124 million med school is one of four major construction projects on the UND campus . . . Politico selected Minnesota to share the title of “ best state” with New Hampshire -- ND ranked No. 15 on the list; SD No. 21.

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