You wouldn't know it from the propaganda emanating from the Statehouse, but things are bad in Indiana. Like real bad. Indiana is among the top-tier states in both mortgage delinquency and mortgage foreclosure rates (a strong indicator of economic distress) and is absolutely hemorrhaging jobs. As Morton Marcus pointed out in his column today, in 2008 and 2009 Indiana lost over a quarter of a million jobs -- the third worst percentage decline in the nation.

But the governor seems to be either (blissfully?) unaware of the state's true situation, or he's purposefully ignoring it. Listening to his state-of-the-state speech, I couldn't help but feel I'd been transported to an Orwellian neverland, where bad is good and good is all around.

Not exactly stellar

"[Treasury Secretary O'Neill] knew Daniels was focused on the perils of rising deficits, but it would take gumption to air those concerns in a room full of tax cut ideologues. 'I think we need to balance concerns,' Daniels said. ... 'You need to be out front on the economy, but I am concerned that this package may not do it. The budget hole is getting deeper. ... We are projecting deficits all the way to the end of your second term.' From across the table came glares from the entire Bush political team. Daniels paused. ... 'Ummmm. On balance, then, I think we need to do a [tax cut] package ... accelerate the rate cuts and the double taxation of dividends...' O'Neill looked with astonishment at Daniels... turn 180 degrees in midsentence." The Price of Loyalty, by Ron Suskind.
"Mitch Daniels' tenure as director of the Office of Management and Budget wasn't exactly stellar. "

Mitch Daniels' tenure as director of the Office of Management and Budget wasn't exactly stellar. The Blade's instinct for fiscal responsibility was there, as we see in the excerpt above, but his lack of political courage, together with his fealty to the corporate line, conspired to render him no more than a budgetary yes man, prostrate in the shadow of his Objectivist overlords, Bush and Cheney.

Which explains the subsequent reign of errors, from his utterance that the Iraq war couldn't possibly cost more than $60 billion, tops, to his endless pronouncements now as Indiana's governor regarding the state of the state's finances and economy.

Let's face it, the guy just isn't very good with numbers. Or predicting the future. Or both.

A salty dog

Daniels' state-of-the-state speech was built around a nautical theme, which was entirely appropriate given the manifold fish tales contained therein. He asserted that the state had been bankrupt when, five years ago, he assumed office (absolutely not true). He crowed that, unlike our sister states, Indiana had not had to cut services -- today it was announced that IU is cutting its medical school enrollment to save costs, while counties throughout the state are considering reverting to gravel-surfaced roads to counter declining revenues. And all over, school systems are letting teachers go.
"His lack of political courage, together with his fealty to the corporate line, conspired to render him no more than a budgetary yes man."
No, not much about the speech was actually true. Certainly not the rose-colored assessment of Indiana's economy, nor the starve-the-beast bromide of tax cuts and spending freezes, depriving those most in need of the essential public services necessary to help them through tough times.

Daniels was center-stage when the Bush administration laid the fiscal foundation for a national and global economic collapse. Center-stage and aware of the danger yet self-censored to avoid an existential political risk. Not good for the country, but it allowed him to sashay into the governorship (if not the governor's mansion).

Where the penchant for tall-tales, ignoring reality and the hard decisions that bad news engenders, continued. A ship of state wrecked on a reef of myopia.

Gregory Travis can be reached at greg@littlebear.com.