Saturday, May 17, 2003

Yeah, things are bad out here in Oregon:

The Pacific Northwest is known for Microsoft, Intel, lattes, breathtaking natural beauty, alternative music, rain, stock-option millionaires and Ichiro Suzuki. We do not associate this forward-looking, entrepreneurial region with economic distress.
So it comes as a surprise to discover that among the 50 states, Oregon now has the nation's highest unemployment rate and Washington is right behind. Last week, Oregon's unemployment rate hit 8 percent, and Washington’s hovers at over 7 percent.

Richard Chapman, vice president of the Economic Development Council of Seattle and King County, says his area has been hit by “the perfect storm.” The collapse of small- and medium-sized information technology businesses, lured here in part by the success of Microsoft, was followed quickly by adversity in the aircraft industry and sharp cutbacks at Boeing. In Oregon, the high-tech downturn has also hurt -- the production of microchips is off -- and so are the lumber and wood-products industries.

The maddening thing is that at precisely the moment when state governments might step in to stimulate the local economy through new spending and tax incentives, their catastrophic budget problems make such moves impossible. Both states are now holding legislative sessions in which the political menu is confined to unappetizing gruel: tax increases or program cuts.

“We've been cutting state budgets, local governments have been cutting their budgets,” said Washington Gov. Gary Locke. “The states are going to have to lay off more employees and more teachers -- or not hire more teachers.” Locke says he expects state layoffs of 2,000 to 2,500 employees.

Margaret Hallock, who advises Oregon Gov. Ted Kulongoski on labor, revenue and work-force issues, points a finger directly at the other Washington -- as in the federal government. “We just do not think that Washington is nearly serious enough about the fiscal crisis in the states around the country."

“Programs have been devolved to the states without sufficient resources to support them,” she says. “States cannot have deficit financing -- we must balance our budgets -- and so when you have this kind of drop in resources, you must either cut your budgets or raise taxes, neither of which is helpful in this kind of economy.”

Oregon gets all kinds of new rules and responsibities from the Feds about Homeland Security, but then Washington doesn't fund those requests and we can't affod to do it on our own. Schools are shuttered and the ones that remain open have fewer teachers. Class sizes have increased dramatically. The school year has been shortened by two weeks (hence, teachers are making two weeks less salary) and extra-curricular activities have been curtailed. Already high property and income taxes are expected to rise even more, and the reason a lot of people live out in this part of the country, the whole Good Quality of Life thingy, is diminished. We, like all states, need financial aid NOW and are getting nothing from Schrubco. We're not asking for the moon and stars here, just some help to get us thru this tough time and until we can elect a President who has a clue about helping us garden-variety folks.