"Bleak Economic News Continues, Underscoring Need for Better Business Climate"
Some Monday mornings are bleaker than others. Nothing says gloom like this Arthur Laffer op-ed in the Wall Street Journal proclaiming "the Age of Prosperity is Over." It's a thoughtful recitation of missteps that he believes have damaged the nation's economy for the forseeable future. A lot of it has to do with bad decisions made in crisis.
These issues aren't Republican or Democrat, left or right, liberal or conservative. They are simply economics, and wish as you might, bad economics will sink any economy no matter how much they believe this time things are different. They aren't
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Whenever people make decisions when they are panicked, the consequences are rarely pretty. We are now witnessing the end of prosperity.
That seems unjustifiably bleak, denying both the resilience of the economy and the ingenuity and determination of investors, business owners, and other job creators. Nonetheless, the current economic news underscores the challenges ahead.
Last week, Bill Virgin reported on a Hebert Research survey of Puget Sound area business executives. At best, it's a mixed bag.
But ask those same executives what they're expecting for the next 12 months, and far more caution and concern show up in their assessment of local and national business conditions.
In fact, the quarterly business confidence index was the lowest since Hebert began doing the survey in 1990, lower even than the post- 9/11 dip in the regional economy.
The toll on state revenue collections provides too much opportunity to trigger the panic tax-hike response in state capitols that could severely damage chances for recovery. Stateline.org has another useful roundup of fiscal conditions. And the Wall Street Journal shows Washington as an unhappy winner in the biggest loser competition.
The state reporting the biggest decline in tax revenue was Washington, which had an inflation-adjusted drop of 11.3%.
The major challenge of 2009 will be reigniting economic growth without imposing recovery-killing cost increases on business here.
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