A Holiday Filled With Hope , and Uncertainty
With Christmas and New Year’s falling on Tuesdays, these next couple of weeks seem to be fitting culminations to a year that has been filled with uncertainties.
This holiday season, production and delivery schedules are interrupted, scheduling and staffing are up in the air and even office hours have become question marks. It’s no wonder the stress level has climbed even higher as employees and supervisors struggled the past few weeks with who would be on duty what days and for how long.
Our year has been so uncertain, it took 10 months for economists to decide that yes, we are in a recession. It indeed sounded odd when economists announced in early December that we technically had been in a recession since March. Odd, but fitting for such an emotionally charged year.
Most any other year, a half-point cut in interest rates would spark at least a temporary economic frenzy. Yet 11 cuts by the Fed this year to historic lows have left some to muse the agency is merely grasping at straws.
If the Fed can’t jump-start the economy, perhaps Congress can. To avoid a political disaster, it’s imperative Congress push through an economic stimulus package before the year is out.
Unfortunately, the unified front Congress showed just three months ago has disintegrated into partisan bickering over the $100 billion package passed by the House. That must be put aside to hammer out the specifics in this bill.
While the haggling seems to be over a corporate tax rebate that could amount to $25 billion for firms like IBM and GE, some theorize a provision to allow companies to write off a larger portion of costs associated with new investments is a wiser way to go.
It would most likely benefit the tech sector, which crumbled both nationally and locally as the year went on. Despite the battering, as well as the energy debacle that continues to linger like a bad cold, there was optimism early this summer that the second half of 2001 would see a reverse in recessionary trends. Understandably, any chance for an economic turnaround in the fall toppled with the events of Sept. 11.
Yet, as crushing as that day was in so many ways, it didn’t take long for economists to see signs that despite the terrorist attack, the economy would recover in 2002. As we salve the emotional scars, economically, at least, the country appears to be on the mend.
Christmas, of course, is a time of hope, the birth of something new and wonderful. Three months after one of the most devastating days in American history, we are again awed by the story of a child’s birth that fills us with great compassion and optimism.
We can pause for a moment and be thankful for several gifts that will help shake off our economic doldrums. The resilient health of the biotech industry has been a bright spot that shows no signs of letting up.
Real estate also is weathering the recession. While not as robust as a year ago, several large commercial projects should provide additional stimulus to Downtown’s renaissance.
Certainly, the contributions of our local defense industry and military personnel stationed here is a gift beyond mere thanks. When called upon in a time of crisis, they reacted swiftly to protect our freedom. It’s perhaps been the greatest gift we could ever receive.
Of course, their job is not yet complete. And while the new year allows us time to reflect on the past 12 months, we also look to the challenges that lie ahead.
As our military continues its push to bring terrorists to justice, it reminds us that our vigilance must remain on high alert not only in 2002, but for many years to come.
The optimism for 2002 is shadowed in our state by a gaping budget deficit. As the governor threw billions of surplus dollars this past year at the now-crippled energy industry, California is facing a deficit that could go as high as $20 billion.
It will likely cut a wide swath across every aspect of government, from schools to transportation to propping up the state’s ailing tourism and tech industries.
It’s a challenge that will linger and dampens the hope a new year brings. Much like the rest of 2001, it adds to the uncertainties we already face.
One thing we have learned from this past year is to anticipate potential problems and confront them before they are upon us. Will the state’s deficit be our biggest challenge in 2002?
That, like many other things from 2001, remains an uncertainty.
, Rick Bell