Category Archives: Science & Technology

Is NoVa over the Job Hump?

Nova_jobs

Annual Job Change, Northern Virginia, 2002-2015. Image credit: Terry Clower.

There has been considerable wailing and gnashing of teeth over the abrupt halt in economic growth in Northern Virginia due to sequestration-mandated cutbacks in defense spending and other federal government programs. My fellow Bacon’s Rebellion bloggers and I have led the wailing chorus. Indeed, Don Rippert engaged in some ferocious teeth gnashing in a post this morning.

There’s no question that the Northern Virginia economy has under-performed the national economy over the past two years. But there is evidence to suggest that Virginia’s economic engine may be over the hump. That chart above comes from Terry L. Clower, director of the Center for Regional Analysis at George Mason University, who presented it during a business round table sponsored by the Thomas Jefferson Institute two days ago.

After shedding thousands of jobs in 2012, 2013 and 2014, the federal government has stabilized employment, actually adding a few in 2015. After declining for three  years straight, federal procurement inched back up in 2014. Perhaps most important, Northern Virginia’s professional & business services occupational category grew by 5% between April 2014 and April 2015. That category is the economic driver of the Northern Virginia economy, and the fact that it is expanding faster than federal employment and federal procurement suggests that maybe, just maybe, Northern Virginia tech sector is diversifying beyond the federal government.

It’s hard to imagine that the federal government, with its severe long-term budget constraints, can resume the spending growth path that propelled the Washington metro economy for so many years. Still, there are signs that Northern Virginia businesses are adapting to the new normal. I’m hopeful that the promising statistics represent more than a dead cat bounce.

– JAB

Dubious Oil Lobby Bankrolls Dubious Poll

CEABy Peter Galuszka

In a recent post, Bacons Rebellion extolled the findings of Hickman Analytics Inc., a suburban Washington consulting firm hired by the Consumer Energy Alliance, which found that according to a survey of 500 registered voters, the vast majority of Virginians support Dominion’s Atlantic Coast Pipeline.

The $5 billion project would take natural gas released by hydraulic fracturing from West Virginia southeastward through Virginia into North Carolina. Dominion has taken some strong-arm tactics to force the project through, such as suing property owners who declined to let surveyors onto their property.

Having reported on the controversy in such places as Nelson County, I was surprised to note the Hickman results showing such a strong support for the pipeline.

Maybe, I shouldn’t have been so surprised.

Let’s start with the so-called “Consumer Energy Alliance.” For starters, it is a Texas based lobbying group funded by such fossil fuel giants as ExxonMobil and Devon Energy, perhaps the largest independent oil rim in the country plus as host of utilities.

It has been traversing the United States drumming up support, often through dubious polls, against initiatives to cut back on carbon emissions. It supports the Keystone XL and other petroleum pipelines.

Says SourceWatch, quoting Salon.com, “The CEA is part of a sophisticated public affairs strategy designed to manipulate the U.S. political system by deluging the media with messaging favorable to the tar-sands industry; to persuade key state and federal legislators to act in the extractive industries’ favor; and to defeat any attempt to regulate the carbon emissions emanating from gasoline and diesel used by U.S. vehicles.”

The group was created in the late 2000s by Michael Whatley a Republican energy lobbyist with links to the Canadian and American oil sector.

The alliance’s modus operandi is to use “polls” presumably of average voters on key energy issues.

In Wisconsin, the CEA got involved in a battle over an attempt by electric utilities to hike rates if individual homeowners used solar panels to generate power. The state is dominated by coal-fired power and hasn’t done much with renewables. The utilities claim that they paid for the electricity grid and therefore home-power generators must pay extra for its use and the cost should be shared by all through rate hikes.

Many ratepayers opposed this blatant attempt to push back at solar power. Then, all the way from Texas and Washington, the Consumer Energy Alliance jumped in with the names of 2,500 local ratepayers who backed the rate hikes. It wanted to give their names to Wisconsin regulators.

The Grist asked: “What dog does CEA, a trade group from Texas, have in Wisconsin’s fight, anyway? Well, CEA represents the interests of mostly fossil fuel companies, so it is engaged in a nationwide campaign to slow the spread of home-produced renewable energy. It has a regional Midwest chapter, which pushes for fracking and for President Obama to approve the Keystone XL tar-sands pipeline.”

I was likewise puzzled by the Virginia pipeline survey that CEA paid for by Hickman Analytics, a Chevy Chase, Md. firm that does a lot of political polling. The firm is powerful and its principals were heavily involved with disgraced Democratic presidential candidate John Edwards.

There was a poll by Hickman for CEA showing that New Hampshire vote just love Arctic offshore drilling. That’s off because the Granite State isn’t anywhere close to the Arctic despite its cold winters.

There was another Hickman/CEA poll showing how much Coloradans love the Keystone XL pipeline – another curiosity because the last time I checked that pipeline doesn’t run through Colorado.

And, fresh with a “five figure” sponsorship from Dominion, Bacon’s Rebellion publisher James A. Bacon Jr. starts writing about this dubious poll from a dubious source showing that Virginians are tickled pink with the ACL pipeline. When questioned, he says it’s nothing different from a poll funded by the Sierra Club.

Maybe, on another matter, it is curious that Bacon’s Rebellion’s sponsorship deal with Dominion which Jim posted online is signed by Daniel A. Weekley, vice president for Dominion corporate affairs.

The very same Mr. Weekley signed an informational packet sent out to Virginia homeowners impacted by the proposed pipeline route telling them what a great thing the pipeline is.

Am I connecting the dots correctly?
 

What Role for Nuclear Power in Virginia’s Energy Future?

virginia_nukesby James A. Bacon

Virginia can lead a national renaissance in nuclear energy, argue Robert Hartwell and Donald Hoffman in a new white paper published by the Thomas Jefferson Institute for Public Policy. They advance two main arguments: (1) nuclear is an economical source of green energy emitting near-zero levels of carbon dioxide, and (2) nuclear can support job creation and contribute to the tax base in Virginia.

As the Environmental Protection Agency’s Clean Power Plan compels Virginia to retire coal-fired power plants as the only practical way to meet strict CO2 emission goals, citizens face a critical decision whether or not to build a new nuclear power plant at Dominion Virginia Power’s North Anna nuclear facility. While Hartwell and Hoffman do not endorse the particulars of Dominion’s plans, they make the case that nuclear power is both safe and economical.

Neither Hoffmann nor Hartwell are disinterested parties. Hoffman chairs the Virginia Nuclear Energy Consortium Authority and Hartwell is president of Hartwell Capitol Consulting, which does work on energy and environmental issues. But as the debate over a third nuclear plant at North Anna heats up, they provide an advance look at how the pro-nuclear side will frame the debate.

Safety. Despite the impression created by highly publicized incidents like Chernobyl, Fukushima and Three Mile Island, nuclear power is safe, they assert. “There has never been a nuclear power accident in the United States resulting in radiation being emitted into the atmosphere.” Likewise, there have been “no accidents of any kind involving nuclear” in Virginia, including Dominion’s nuclear plants, dozens of nuclear-powered vessel, and experimental reactors at Fort Belvoir near Alexandria.

As for the North Anna nuclear plants being located on a fault line, they write:

During the 5.8 earthquake centered in Louisa County in August 2011, the North Anna 1 and 2 plants automatically shut down and were carefully checked before restarting nearly 90 days later. No damage occurred although some of the nuclear storage casks were moved closer together and some slid more than 4.5 inches.

Cost. Studies have found that nuclear power generated in Virginia was the least expensive of any power generation source. The cost per kilowatt hour was estimated at 0.6 cents compared to 3.5 cents for coal and 4.5 cents for natural gas. (The authors do not cite their sources for this data.)

Economic development. Aside from California, Virginia is the largest electricity importer among the 50 states. Moreover, the state will need more than 4,000 megawatts of additional power to meet the increased demand for electricity by 2021. Building power plants in Virginia creates jobs locally and bolsters the tax base.

Experts have found that the average nuclear power plant generates $470 million in sales of goods and services annually. One plant provides approximately $40 million in labor income each year and 400 to 700 full-time permanent jobs which pay 36% more than other local jobs. Each plant also generates an average of $16 million in state and local tax revenue for schools, roads and hospitals.

Virginia is particularly well suited for nuclear power, the authors contend. “The sheer number of nuclear operations and nuclear-related facilities, engineering schools and federal facilities and critical infrastructure which could benefit from safe and secure nuclear power is breathtaking.” An idea of the number of players who could benefit from a renaissance of nuclear power can be seen in the list of nuclear-related companies with a presence in Virginia:

  • Areva
  • Babcock and Wilcox
  • Bechtel Power Corporation
  • Bridgeborn
  • Dominion Virginia Power
  • Excel Services Corporation
  • Fluor Daniel Services Corporation
  • GE Hitachi Nuclear Energy
  • Huntington Ingalls (Newport News Nuclear)
  • Siemens
  • The Atlantic Group
  • Thorium Power (Lightbridge)
  • Toshiba America Nuclear Energy

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Taxation and the Creative Class

science_stars

Urban geographer Richard Florida has famously argued that members of the “creative class” — scientists, entrepreneurs, artists and other professions who contribute disproportionately to economic growth — gravitate to metropolitan regions marked by the three “t’s” — technology, talent and tolerance. Now new research suggests that he may have to add a fourth “t” — taxes.

A National Bureau of Economic Research paper, “Taxation and the International Mobility of Inventors,” studies the effects of taxation on the international mobility of inventors, with an emphasis on the superstars who have the most, or most valuable patents. The results suggest that a 10 percentage-point cut in a nation’s top tax rates is associated with about a 1% increase in the number of domestic superstar inventors. The number is even higher for the number of foreign inventors — a 10 percentage-point increase drop is associated with a 38% increase for this group. Inventors who have worked for multinational firms appear to be most likely to respond to tax differentials.

Another study, “The Effect of State Taxes on the Geographical Location of Top Earners: Evidence from Star Scientists,” finds that tax sensitivity is even greater when accounting for cross-state location of top corporate scientists in the U.S.; there is little effect on academic or government researchers.  “Overall, we conclude that state taxes have a significant effect on the geographical location of star scientists and possibly other highly skilled workers. While there are many other factors that drive when innovative individual and innovative companies decide to locate, there are enough firms and workers on the margin that relative taxes matter.”

Sad to say, Virginia doesn’t even rank in the list of the ten states with the largest populations of star scientists. But if we’re serious about wanting to attract corporate research here, personal tax rates are a factor that must be considered.

— JAB

New Film Documents Horrors of Coal Mining

blood on the moutain posterBy Peter Galuszka

Several years in the making, “Blood on the Mountain” has finally premiered in New York City. The documentary examines the cycle of exploitation of people and environment by West Virginia’s coal industry highlighting Massey Energy, a coal firm that was based in Richmond.

The final cut of the film was released publicly May 26 at Anthology Film Archives as part of the “Workers Unite! Film Festival” funded in part by the Fund for Creative Communities, the Manhattan Community Arts Fund and the New York State Council of the Arts.

Directed by Mari-Lynn Evans and Jordan Freeman, the film shows that how for more than a century, coal companies and politicians kept coal workers laboring in unsafe conditions that killed thousands while ravaging the state’s mountain environment.

As Bruce Stanley, a lawyer from Mingo County, W.Va. who is interviewed in the film and has fought Donald L. Blankenship, the notorious former head of Massey Energy, says, there isn’t a “War on Coal,” it is a “war waged by coal on West Virginia.”

When hundreds of striking workers protested onerous and deadly working conditions in the early 1920s, they were met with machine guns and combat aircraft in a war that West Virginia officials kept out of history books. They didn’t teach it when I was in grade school there in the 1960s. I learned about the war in the 1990s.

The cycle of coal mine deaths,environmental disaster and regional poverty continues to this day. In 2010, safety cutbacks at a Massey Energy mine led to the deaths of 29 miners in the worst such disaster in 40 years. Mountains in Central Appalachia, including southwest Virginia, continue to be ravaged by extreme strip mining.

As Jeff Biggers said in a review of the movie in the Huffington Post:

“Thanks to its historical perspective, Blood on the Mountains keeps hope alive in the coalfields — and in the more defining mountains, the mountain state vs. the “extraction state” — and reminds viewers of the inspiring continuum of the extraordinary Blair Mountain miners’ uprising in 1921, the victory of Miners for Democracy leader Arnold Miller as the UMWA president in the 1970s, and today’s fearless campaigns against mountaintop-removal mining.”

The movie (here is the trailer) is a personal mission for me. In 2013, after my book “Thunder on the Mountain, Death at Massey and the Dirty Secrets Behind Big Coal,” was published by St. Martin’s Press, Mari-Lynn Evans called me and said she liked the book and wanted me to work with her on the movie project. She is from a small town in West Virginia a little south of where I spent several years as a child and thought some of my observations in the book rang true.

I drove out to Beckley, W.Va. for several hours of on-camera interviews. Over the next two years, I watched early versions, gave my criticisms and ideas and acted as a kind of consultant. Mari-Lynn’s production company is in Akron and I visited other production facilities in New York near the Brooklyn Navy Yard.

Interesting work if you can get it. My only forays into film making before had been with my high school film club where he videographed a coffin being lowered into a grave (in West Virginia no less). I was greatly impressed when I saw the movie at its New York premiere.

Mari-Lynn and Jordan have been filming in the region for years. They collaborated on “The Appalachians,” an award-winning three-part documentary that was aired on PBS a few years ago and on “Coal Country” which dealt with mountaintop removal strip mining.

They and writer Phyllis Geller spent months detailing how coal companies bought up land on the cheap from unwitting residents, hired miners and other workers while intimidating them and abusing them, divided communities and plundered some very beautiful mountains.

Upper Big Branch is just a continuation of the mine disasters that have killed thousands. The worst was Monongah in 1907 with a death toll of at least 362; Eccles in 1914 with 183 dead; and Farmington in 1968 with 78 dead (just a county over from where I used to live).

By 2008 while Blankenship was CEO of Massey, some 52 miners were killed. Then came Upper Big Branch with 29 dead in 2010.

At least 700 were killed by silicosis in the 1930s after Union Carbine dug a tunnel at Hawks Nest. Many were buried in unmarked graves.

While state regulation has been lame, scores West Virginia politicians have been found guilty of taking bribes, including ex-Gov. Arch Moore.

The movie is strong stuff. I’ll let you know where it will be available. A new and expanded paperback version of my book is available from West Virginia University Press.

Blankenship is scheduled to go on trial on federal charges related to Upper Big Branch on July 13.

Finally, Tobacco Commission Gets Reforms

Feinman

Feinman

By Peter Galuszka

Virginia’s infamous tobacco commission appears to be finally getting needed reforms 15 years after it went into existence.

Gov. Terry McAuliffe announced today that he was appointing a new executive director, Lynchburg native Evan Feinman, ordering a slimmed down board of directors and requiring a dollar-for-dollar match on grants the commission doles out to support community development in Virginia’s old tobacco belt.

In another break with the past, McAuliffe is renaming the old Virginia Tobacco Indemnification and Community Revitalization Commission as the Virginia Tobacco Region Revitalization Commission.

That might sound cosmetic, but any change is welcome given the commission’s history.

Since its formation after the 1998 Master Settlement Agreement between 46 states and four large cigarette makers, the commission has been spending millions of dollars won from the tobacco firms supposedly to help tobacco growers in a region roughly following the North Carolina border wean themselves off of the golden leaf toward economic projects that are far healthier.

Instead, the commission has been racked by scandal after scandal, including the conviction of a former director, John W. Forbes II, for embezzling $4 million in public money. He is now serving a 10-year jail sentence.

The commission also figured in the corruption trial of former Gov. Robert F. McDonnell since it was suggested my McDonnell as a possible source of funding for businessman Jonnie R. Williams Sr. during McDonnell’s trial for corruption. Williams, who was the star prosecution witness against McDonnell, got help from McDonnell in promoting one of his vitamin supplement products. McDonnell was convicted of 11 felonies and is now appealing.

The old commission also has been criticized by a major state audit for funding dubious projects and not keeping track of whether the money it has doled out has done much good. It had been criticized for acting as a slush fund for projects favored by Southside and southwestern Virginia politicians.

McAuliffe’s reforms include reducing the commission’s board from 31 to 28 members and requiring that 13 of them have experience in business, finance or education.

Feinman has been deputy secretary of natural resources and worked with McAuliffe’s post-election team.

It’s too soon, of course, to know if these changes will bring results, but anything that moves the commission away from its past and the grasp of mossback Tobacco Road politicians is welcome.

Blankenship’s Incriminating Tapes

don-blankenship By Peter Galuszka

It may sound like something out of the Nixon White House, but embattled coal baron Donald L. Blankenship regularly taped conversations in his office, giving federal prosecutors powerful new ammunition as he approaches criminal trial in July.

According to Bloomberg News, the former head of Massey Energy taped up to 1,900 conversations that often go to the heart of the case against him. Blankenship was indicted last Nov. 13 on several felony charges that he violated safety standards and securities laws in the run up to the April 5, 2010 blast at the Upper Big Branch mine in West Virginia that killed 29 miners.

The revelation of the tapes came about in a circuitous way. The tapes were given to federal prosecutors in 2011 by officials of Alpha Natural Resources, which bought Richmond-based Massey Energy in 2011 for $7.1 billion.

After reaching a non-prosecution deal with federal prosecutors, Alpha hired a powerful New York law firm to investigate Massey for any possible violations.

Alpha, based in Bristol, was required as part of a non-prosecution order it signed to surrender all evidence, including the tapes.

Earlier this year, Alpha declined to continue paying Blankenship’s legal bills since he was under criminal indictment. Blankenship, claiming Alpha was required to indemnify, him, sued Alpha in a Delaware court. The existence of the tapes was revealed in that venue.

According to court documents filed in Delaware, Blankenship seemed to know that his disregard and hardball management practices could hurt him.

The tapes show Blankenship’s disdain for the U.S. Mine Safety and Health Administration (MSHA), which regulates mines but also reveal Blankenship knew Massey’s practices were risky.

According to testimony, a tape has Blankenship stating, “Sometimes, I’m torn up with what I see about the craziness we do. Maybe if it weren’t for MSHA, we’d blow ourselves up. I don’t know.”

“I know MSHA is bad, but I tell you what, we do some dumb things. I don’t know what we’d do if we didn’t have them,” Blankenship said on tape in the Delaware case.

So far, little has been revealed about what evidence the U.S. Attorney’s Office in Charleston, W.Va. has against Blankenship. Irene Berger, a U.S. District Judge in Beckley, W.Va., issued a massive gag order forbidding lawyers and even family members of the 29 mine victims from discussing the case, now scheduled for July 13 in Beckely.

The gag rules were order modified after the Charleston Gazette and the Wall Street Journal among other news outlets challenged them before the U.S. Fourth Circuit Court of Appeals in Richmond.

In some cases, apparently, the tapes cut both ways. In Delaware, Blankenship’s lawyers played a tape from 2009 which has Blankenship urging executives to tighten up on safety. “I don’t want to go to 100 funerals,” he is quoted as saying. He allegedly told Baxter Phillips Jr., then Massey’s president, that if there were a fatal disaster, “You may be the one who goes to jail.”

According to Bloomberg, Alpha initiated the internal probe after reaching a non-prosecution deal with federal prosecutors. It hired Cleary Gottleib Steen & Hamilton of New York to handle it.

Since Alpha refused to continue paying Blankenship’s legal bills, Blankenship reportedly has paid his lawyers $1 million himself.

The writer is the author of “Thunder on the Mountain, Death at Massey and the Dirty Secrets Behind Big Coal,” 2012, St. Martin’s Press. Paperback , West Virginia University Press, 2014.

Using Big Data to Lift Americans out of Poverty

Senior person hands begging for food or helpWe’ve reached a dead end in the debate over poverty here in the United States. Liberals and Democrats say that all we need is to throw more money at the program, as if the trillions we’ve spent over the past 50 years were not enough. Conservatives and Republicans, while great at dissecting the failure of Great Society anti-poverty programs, don’t have much to offer in their place. No one, not even mean, skin-flinted conservatives like me, want to slash benefits willy nilly. No one wants a country in which poor children starve or poor sick people die from a sudden retraction of the safety net.

Is there a third way? Perhaps. From the small but magnificent country of New Zealand (run by the conservative National Party) comes a new idea: using Big Data to target welfare dollars where they are most needed. Allegheny County, Pa., (which includes Pittsburgh) is hiring a Kiwi pioneer in the field to apply the same approach to the American welfare system. Maybe Virginia should consider doing the same.

Writes Josh Eidelson with Bloomberg:

In 2010, when [New Zealand] Minister of Finance Bill English first convened a policy group to review welfare spending, government statistics showed half the 4,300 teenage single mothers receiving benefits in that country were likely to remain in the welfare system for 20 years, at a total cost of about $264,000 each. The government responded with $23 million to assign individual case workers to help teenage mothers finish school and find work. Now, after four years, the number of teenage single parents on benefits has dropped to 2,600.

Using data from welfare, education, employment, and housing agencies and the courts, the government identified the most expensive welfare beneficiaries—kids who have at least one close adult relative who’s previously been reported to child safety authorities, been to prison, and spent substantial time on welfare. “There are million-dollar kids in those families,” English says. “By the time they are 10, their likelihood of incarceration is 70 percent. You’ve got to do something about that.”

What works in a small, homogeneous country like New Zealand may not translate well to a large, multicultural country like the United States with a culture of inter-generational poverty and dysfunctional governance institutions. But, then, it’s just possible that the Kiwi model will work here. Given our impotence in combating poverty in the U.S., we don’t have anything to lose. If we frame the initiative as fiscally conservative (no one is asking to spend more money or raise taxes) and as pragmatically effective (we succeed at actually lifting at-risk people out of poverty), using Big Data to combat poverty would at least be a political winner.

— JAB

Dave Brat’s Bizarre Statements

 By Peter Galuszka

Almost a year ago, Dave Brat, an obscure economics professor at Randolph- Macon College, made national headlines when he defeated Eric Cantor, the powerful House Majority Leader, in the 7th District Brat Republican primary.

Brat’s victory was regarded as a sensation since it showed how the GOP was splintered between Main Street traditionalists such as Cantor and radically conservative, Tea Party favorites such as Brat. His ascendance has fueled the polarization that has seized national politics and prevented much from being accomplished in Congress.

So, nearly a year later, what has Brat actually done? From reading headlines, not much, except for making a number of bizarre and often false statements.
A few examples:

  • When the House Education and Workforce Committee was working on reauthorizing a law that spends about $14 billion to teach low-income students, Brat said such funding may not be necessary because: “Socrates trained Plato in on a rock and the Plato trained Aristotle roughly speaking on a rock. So, huge funding is not necessary to achieve the greatest minds and the greatest intellects in history.”
  • Brat says that the Affordable Care Act (Obamacare) is a step towards making the country be more like North Korea. He compares North and South Korea this way:  “. . . it’s the same culture, it’s the same people, look at a map at night, half the, one of the countries is not lit, there’s no lights, and the bottom free-market country, all Koreans is lit up. See you make your bet on which country you want to be, right? You want to go to the free market.” One problem with his argument:  Free market South Korea has had a single payer, government-subsidized health care system for 40 years. The conservative blog, BearingDrift, called him out on that one.
  • Politifact, the journalism group that tests the veracity of politicians’ statements, has been very busy with Brat. They have rated as “false” or “mostly false” such statements that repealing Obamacare would save the nation more than $3 trillion and that President Obama has issued 468,500 pages of regulations in the Federal Register. In the former case, Brat’s team used an old government report that estimated mandatory federal spending provisions for the ACA. In the latter case, Politifact found that there were actually more pages issued than Brat said, but they were not all regulations. They included notices about agency meetings and public comment periods. What’s more, during a comparable period under former President George W. Bush, the Federal Register had 465,948 pages, Politifact found. There were some cases, however, where Politifact verified what Brat said.
  • Last fall, after Obama issued an executive order that would protect up to five million undocumented aliens from arrest and deportation, Brat vowed that “not one thin dime” of public money should go to support Obama’s plan. He vowed to defund U.S. Citizen and Immigration Services but then was told he couldn’t do so because the agency was self-funded by fees from immigration applications. He then said he would examine how it spent its money.

The odd thing about Brat is that he has a doctorate in economics and has been a professor. Why is he making such bizarre, misleading and downright false statements?

Beware Stalling Growth in Northern Virginia

northern virginia mapBy Peter Galuszka

For at least a half a century, Fairfax County, Alexandria and Arlington County have been a growth engine that that has reshaped how things are in the Greater Washington area as well as the Old Dominion.

But now, apparently for the first time ever, these Northern Virginia localities have stopped growing, according to an intriguing article in The Washington Post.

In 2013, the county saw 4,673 arrivals but in 2014 saw 7,518 departures. For the same time period, Alexandria saw 493 arrivals and then 887 departures. Arlington County showed 2,004 arrivals in 2013 followed by 1,520 departures last year.

The chief reason appears to be sequestration and the reduction of federal spending. According to a George Mason University study, federal spending in the area was $11 billion less  last year than in 2010. From 2013 to 2014, the area lost 10,800 federal jobs and more private sectors ones that worked on government contracts. Many of the cuts are in defense which is being squeezed after the wars in Afghanistan and Iraq.

The most dramatic cuts appear to be in Fairfax which saw a huge burst of growth in 1970 when it had 450,000 people but has been slowing for the most part ever since. It still grew to 1.14 million people, but the negative growth last year is a vitally important trend.

Another reason for the drop offs is that residents are tired of the high cost and transit frustrations that living in Northern Virginia brings.

To be sure, Loudoun County still grew from 2013 to 2014, but the growth slowed last year from 8,904 newcomers in 2013 to 8,021 last year.

My takeaways are these:

  • The slowing growth in NOVA will likely put the brakes on Virginia’s move from being a “red” to a “blue” state. In 2010, Fairfax had become more diverse and older, with the county’s racial and ethnic minority population growing by 43 percent. This has been part of the reason why Virginia went for Barack Obama in the last two elections and has Democrats in the U.S. Senate and as governor. Will this trend change?
  • Economically, this is bad news for the rest of Virginia since NOVA is the economic engine for the state and pumps in plenty of tax revenues that end up being used in other regions. Usually, when people talk about Virginia out-migration, they mean people moving from the declining furniture and tobacco areas of Southside or the southwestern coalfields.
  • A shift in land use patterns and development is inevitable. The continued strong growth of an outer county like Loudoun suggests that suburban and exurban land use patterns, many of them wasteful, will continue there. The danger is that inner localities such as Fairfax, Arlington and Alexandria, will be stuck with more lower-income residents and deteriorating neighborhoods. The result will be that localities won’t have as much tax money to pay for better roads, schools and other services.
  • Virginia Republicans pay lip service to the evils of government spending and have championed sequestration. Well, look what a fine mess they have gotten us into.

The rest of the Washington area is seeing slowing growth, but appears to be better off. The District’s in-migration was cut in half from 2013 to 2014 but it is still on the plus side. Ditto Montgomery and Prince George’s Counties.

NOVA has benefited enormously from both federal spending and the rise of telecommunications and Web-based businesses. It is uncertain where federal spending might go and maybe increased private sector investment could mitigate the decline. Another bad sign came in 2012 when ExxonMobil announced it was moving its headquarters from Fairfax to Houston.

In any event, this is very bad news for NOVA.