According to the economic outlook provided by the Eller school, "most forecasts for the U.S. now show the economy teetering on the brink of recession...we believe that Arizona's economy is already in a recession that will stretch well into 2008. Labor markets are deteriorating and job growth is disappearing."
In fact, job growth is overstated and will be revised downward to near zero for 2007. Projections show a significant loss of jobs in 2008 and fewer lost in 2009. A recent issue of Business Week, provided a chart showing small business jobs to be the worst in years and declining rapidly. Arizona appears to be following the trend.
With Arizona heading for a $1.5 billion deficit, and no champion in sight to save Arizona's economy, it looks like things will get a whole lot worse before they get better. The obvious solution that nobody wants to face is slashing government spending. A systematic multi-year suck-it-up belt-tightening would do it. But Janet would have to rescind her all-day kindergarten, back down on free college tuition for everyone who can pull a B in high school, and resign herself to driving to Tucson instead of riding her flashy light rail system.
Not only that, spending drunkards in Phoenix would have to detox for the next few years not only to the point of eliminating the deficit, but even beyond in order to push taxpayer dollars back to taxpayers where it can do some good for the economy. I'm not talking about Congress' method of stimulating the economy. It certainly does no good to follow the example of our binge spending congressmen who borrow money from China to give us $600 so we can go out and buy more products made in China. So much for stimulating the U.S. economy.
No, the only way we're going to get out of this mess is to make some courageous choices in the legislature and take away Napolitano's credit card. The question is: "Who's going to make it happen?" When asked in a recent interview how she would cut the deficit all Nancy Young Wright could say is she would protect education, increase taxes and push light rail.
So when it comes to saving the economy, my question remains: "Who's going to make it happen?" Right now, I have no answers.
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3 comments:
While I understand how slashing the budget would help with the state's deficit, I fail to see how it would help the employment issue.
When money is taken out of non-producing entities i.e. government, and put back into the private sector to be invested in businesses in some form or other, businesses can produce more efficiently and jobs are created.
If the tax rebate were not borrowed, but taken from real cuts in spending, many consumers would use that money to pay down debts. That puts more money back into the banking system which will gain greater liquidity and the ability to increase lending to businesses.
That is total theory...and theory that has never worked. Look what GOP economic theory has gotten us today. They have cut cut cut taxes and programs to the bare bones and now we are faced with the poorest of infrastructure and an education system that won't support the growth the GOP bets on for the revenue.
By the way, why don't we cut things like corrections that are indeed costing our state enormous amounts of dollars.
We used to spend 33 cents on corrections on every dollar spent for higher ed. Now we spend about 70 cents for every dollar spent on higher ed. Much more on corrections and we still have the 2nd lowest student aid of any state in the nation.
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