Is the Sunshine State now the Kick Me State?.
. That's the drift in North Carolina, it seems. A Charlotte Observer front page story Monday headlined "Financial Chill? Try Blaming Florida" suggests North Carolina businesses that expanded to Florida in good times now blame Florida's economic distress for much of their own woes.
"Charlotte's emergence as a headquarters for national corporations, plus Florida's proximity — attractive to regional companies — have combined to make the state a sore spot with a range of businesses," the Observer story says.
It's all true. No denying. Florida is the Black Hole Economy these days. Especially for North Carolina corporations. Florida and North Carolina have had close ties for decades. In the summer, try to find a license plate near Cashiers, a North Carolina mountain tourist town, that isn't from Florida.
For that matter, look at the domination by North Carolina companies in some key Florida industries. In Florida, Bank of America (based in Charlotte) is a giant among banks. Ditto Wachovia — also from Charlotte, but now owned by San Francisco's Wells Fargo Corp. Progress Energy, which controls most of west-central Florida's electricity market, is based in Raleigh, N.C. The Lowe's home improvement chain is from North Carolina. So are plenty of real estate investment firms that hold substantial stakes in Florida properties.
Small wonder, after jumping into once-faster-growing Florida, these North Carolina businesses are crying uncle.
As the Observer notes, in June the North Carolina parent of Boyles Distinctive Furniture filed for Chapter 11 bankruptcy protection, citing losses at failed stores in Florida. Charlotte-based developer Crescent Resources filed for Chapter 11 last month, its worst losses in Florida. Lowe's earlier said sales at its South Florida stores dropped by double digits in the first quarter. Auto retailer Sonic Automotive, based in Charlotte, often labels Florida a weak spot in earnings calls.
Frankly, Florida deserves some scorn heaped on it by out-of-state businesses. We crowed for years that our state economy was bulletproof, a combination of sunshine, cheap living and cheaper labor, a pro-business government and an assumed firehose of cold-weather retirees pouring in bringing their pensions, rich stock market portfolios and proceeds from selling their high-priced Northern homes.
Well, we ruined the housing market by overbuilding and speculative price runups. We soured residents by making what was once inexpensive a much more costly place to live — without tangible benefits. We bummed out locals with lousy growth management that (and we're not alone here) clog our roads and discourage long-range planning (like mass transit). Add in a few hurricanes just to scare people and stupefy our property insurance market.
All of a sudden that growth firehose of newcomers slowed dramatically. And so did the economy.
But Florida's not the only state sucking wind. If Florida's struggling with an unemployment rate of 10.2 percent, why is North Carolina's so much higher at 11.1 percent?
Suck it up, North Carolina businesses. Welcome to Florida. In good times and bad.
Robert Trigaux can be reached at email@example.com.