Monday, June 25, 2018
Business

Better off than four years ago, but what of four years from now?

Are you better off than you were four years ago?

Now there's a duh question. Yes, most of us are better off by far than the summer and fall of 2008, when massive job losses were routine, area home prices were plummeting by 20 percent annually, a severe credit crunch halted most lending, area gas prices topped $4 a gallon and the imminent threat of a Wall Street meltdown spurred an unprecedented federal bailout.

Even if the statistics of 2008 are not convincing, consider the sense of growing national economic panic back then. While that feeling isn't gone, it has been dialed back dramatically.

Plenty of Floridians who lost jobs still can't find another one or have settled for lesser work and pay. Hundreds of thousands of Florida homeowners suffered foreclosure or still hold mortgages bigger than the value of their homes.

But even in the harder-hit economy of Florida and Tampa Bay, most of us now are better off.

This isn't an argument to give President Barack Obama four more years. You might think he should have done a better job in his first term or that Mitt Romney would be a better president.

Both political parties, of course, are telling us that in 2008 things were either better (the Republican spin) or worse (the Democratic spin) than 2012. Vote accordingly come the November election, they urge.

Politics does not change the point that 2008 was an economic nightmare. Things are now better, even if they have not improved nearly as much as we hoped.

Four years ago this month, the Bush administration proposed a historic $500 billion bailout of major Wall Street firms and big banks. It meant the government, rather than the cold calculations of the marketplace, would decide the winners and losers from the crisis that shook the U.S. economy.

While few of us today are ecstatic with the economy or job prospects, there is a very different feeling. We're no longer scrambling as if we're on the Titanic scrapping for the last spot on a lifeboat.

There is more stability. If Florida's economy has yet to roar again, it has at long last stopped whimpering. And that is a big step in the right direction.

• • •

Let's look back briefly at Tampa Bay Times coverage of what was happening in our economy during the summer and early fall of 2008:

• "Once a job-generating machine, Florida led the nation in job losses in July. For the third straight month. And Tampa Bay is the state's hardest-hit metro area. Thousands of Florida private sector workers lost their jobs last month as the unemployment rate jumped to 6.1 percent, its highest level in 13 years." (July 16, 2008)

• "Florida was No. 1 among states in job losses in July (a loss of 21,400) and the past year (lost 96,800, about twice that of runnerup job loser Michigan)." (July 17, 2008)

• "Regular unleaded (gasoline) cracked the $4-a-gallon mark, peaking July 16 at $4.009 on average, in the Tampa Bay area." (July 17, 2008)

• "Area (home) prices are down 20.1 percent year over year and 1.2 percent from May to June. The composite sales price of $175,110 in the bay area is the lowest since December 2004." (Aug. 27, 2008)

• "If the nation's consumer confidence is dragging bottom, Floridians are right behind. Among Florida adults, (consumer confidence) fell sharply in October to 60, down eight points from the revised number for September and down 19 points from a year ago. 'Florida consumers are becoming increasingly pessimistic about their ability to maintain financial stability,' said Chris McCarty, the University of Florida survey director at the Bureau of Economic and Business Research." (Oct. 29, 2008)

I wanted to quote directly from these five Tampa Bay Times stories in 2008 to remind readers of the rising tide of insecurity sweeping the state and country.

A pessimist might say that things stank in '08 and today's economic aroma is little improved.

An optimist might suggest the threat of a widespread, imminent economic collapse in 2008 is far less likely now.

Four years ago, we hit the economic equivalent of Defcon 1. Hence the correct if clumsy decision by the Bush administration to step in with an emergency bailout.

And now? We're closer to Defcon 3. That's lower on the scale of near-term danger but still a big concern because of the huge runups since 2008 in the U.S. deficit and national debt.

Such financial difficulties might be manageable via some compromise mix of spending cuts and tax increases if we did not have a dysfunctional federal government. In fact, our political inability to solve economic challenges is the primary reason the World Economic Forum, a think tank, last week said the United States again dropped in its annual 2011-2012 ranking of global competitiveness. The country fell two spots, to No. 7 from No. 5, among 144 ranked countries.

That may not sound too bad. But we're actually sinking quickly thanks to political inaction. In the 2008-2009 ranking, this country was No. 1.

It's politically popular to ask "Are you better off than you were four years ago?" But maybe it's the wrong question to be posing in the first place.

Will you be better off four years from now?

That look-ahead question is far more interesting. Again, my answer is yes, we will be better off in 2016. But no matter who ends up in the White House we may be frustrated at the pace of improvement. Can this country's leaders work together? If they don't, my "better off" forecast will be dead wrong.

Contact Robert Trigaux at [email protected]

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