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x58
Texans won't escape recession
Updated: 10/26/2009 12:02 PM
By: Harvey Kronberg

Programs like the $8,000 first time homebuyer tax credit have been good for business.  
Late this week, the federal government is expected to announce some much needed good economic news.

If prognosticators are correct, the gross domestic product will finally move into positive territory.

Yes, President Obama deserves some credit. Stimulus programs like cash for clunkers and the $8,000 first time home buyer tax credit clearly goosed business and may have actually jump started those industries. Plus, the weak dollar means that our goods and services are less expensive around the world, especially in Asia where a robust recovery has already begun.

But the metric upon which elections will pivot in 2010 still looks pretty bleak as unemployment continues to creep upward.

Gov. Perry and Lt. Gov. David Dewhurst have taken too much chest thumping in the last year proclaiming that Texas missed much of the Great Recession.

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News 8's Harvey Kronberg takes pause as Texas unemployment threatens the state's recovery.



But next month, Texas is likely to cross its own symbolic threshold with more than a million of our family, friends and neighbors unemployed and looking for work.That's nearly ten times the original estimates Comptroller Susan Combs predicted last January.

As you know, truth is the first casualty of political campaigns. The simple, unavoidable truth is that were it not for the federal stimulus program pumping $16 billion into state and local budgets this year, Texas unemployment would have hit the million mark months ago. Plummeting tax collections would have forced the firing of tens of thousands of city, county and state employees; cops, teachers, and state workers as all government struggled to balance their budgets.

You can see the effects of the million unemployed everywhere. Sales tax collections have declined by double digits in each of the last four months. That has never happened since the sales tax was instituted.

Walk most neighborhoods and you will see for sale signs popping up. Home foreclosures in Texas are surging.

Southwest Airlines posted its first quarterly loss in my memory and airport traffic continues to decline. Even the Port of Houston revenues are down almost 20 percent.

You can see the effects of the million unemployed everywhere.  
Friends with skin in the game tell me that commercial real estate has another 25 percent to drop in Texas and will not begin recovery until the end of next year. Meanwhile vacancies in prime office space continue growing and vacant strip centers are depressingly common.

Not all the news is bad. In fact, we should start to feel the recovery in Texas sometime next year. But campaign rhetoric notwithstanding, next month more than a million Texans will face one of the grimmest Thanksgivings in decades.





Political commentator Harvey Kronberg shares his thoughts on politics in Texas each Monday during On the Agenda. Kronberg is the writer, editor, publisher of the Quorum Report, Texas' oldest political newsletter.




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Troubled Waters
News 8's Jenna Hiller explored the troubled waters in Central Texas and traveled down the Colorado River in search of information. Click on the links to watch, read and interact.

Part 1: Regional cooperation drying out
Part 2: Texas rice farmer takes on water wars
Part 3: Security of supply saturates perception
Part 4: Bad news travels near and far
Part 5: Bad news travels near and far

Where does your water come from?

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