Reopening San Diego’s Economy: Take a Deep Breath, Dream Big
Politicians and business people who think resetting the clock on the economy will make everything better are delusional.
The numbers don’t lie. Something monumental has happened in the world. History shows that every time something of this magnitude occurs there are collateral consequences and new opportunities.
Fortunately, a majority of people in this country say they aren’t ready to resume formerly normal activities. So, thus far, the “reopen” crowd is playing to a very small audience.
A collection of leftover Tea Partiers, anti-vaxxers, and men with short dicks long guns are trying their best to bully the rest of us into getting back into the grind, consequences be damned.
The scientists who speak out on the very real risks involved are dismissed and reviled. Public officials doing the right thing based on the evidence at hand get death threats.
The administration and their political minions are playing the denial card. They say with a straight face that deaths from COVID-19 are being exaggerated by liberals who want to ruin Dear Leader Trump’s beautiful economy.
San Diego County Supervisor Jim Desmond has gone public with this line of bs, saying fatalities of those infected with the virus who had underlying conditions don’t count.
https://twitter.com/hopfreq/status/1261421170169049088?s=20
Try as I might, I can’t find any evidence in the former Delta Airlines pilot’s history of any medical training or epidemiological studies. Maybe he went to Trump University.
https://twitter.com/CDCDirector/status/1261406011039993856?s=20
The nation and the world are in for a long, tough slog, based on what has already happened beyond the sickness and deaths we’ve been hearing about.
I’m talking cold, hard numbers that can’t be wished away by deplorables.
The Federal Reserve reported that factory output fell 11.2% in April, the worst result since that measurement started being taken 101 years ago.
April retail sales plunged 16.4%, double the drop in March, which was the worst since 1992, according to the Commerce Department.
More than 36 million people have recently applied for unemployment. Plus the millions of others who have lost their jobs but haven’t applied for benefits or who are not counted as unemployed because of the government’s definition of having “left the labor force.” All told, it would be optimistic to assume that the current layoff count is less than 44 million.
And here’s the real kick in the pants:
A 39-page report by the National Bureau of Economic Research estimated that 42% of job losses will be permanent:
Even if medical advances or natural forces bring an early resolution to the crisis, many pandemic-induced shifts in consumer demand and business practices will persist. Thus, much of the near-term re-allocative impact of the pandemic will also persist, as indicated by our forward-looking reallocation measures. Drawing on our survey evidence and historical evidence of how layoffs relate to recalls, we estimate that 42 percent of recent pandemic-induced layoffs will result in permanent job loss. If the pandemic and partial economic shutdown linger for many months, or if pandemics with serious health consequences and high mortality rates become a recurring phenomenon, there will be profound, long-term consequences for the reallocation of jobs, workers and capital across firms and locations
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https://twitter.com/Kevin_Faulconer/status/1261050848852860928?s=20
Yes, hizzoner did use the words “safely work,” but he’s ignoring the bigger picture.
All the health oriented restrictions currently in place could be lifted tomorrow, and San Diego’s economy would still be tanking.
There is wishful thinking coming from San Diego’s hotelier-run Tourism Marketing District, which is poised to begin a multimillion dollar ad campaign aimed at Southern California, Nevada, and Arizona.
Thought: There’s a “public-private” sacred cow that needs to be sacrificed at the altar of good governance.
Their crystal ball is telling hospitality operators that business will be up to 80% of where it once was come December of this year. I’m guessing they acquired this fortune telling device from White House advisor Larry Kudlow, who told Fox News today another corporate tax cut is needed to stimulate the economy.
Or maybe they were listening to Peter Navarro, Donald Trump’s trade adviser who told Fox News on Thursday that California will soon become a red state because residents are supposedly “unhappy with stay-at-home orders and other economic restrictions.”
FYI- Gov. Newsom’s approval in California stands at 70% in view of his handling of the COVID-19 crisis, up from 60% in September 2019.
A more sober analysis of where the economy is headed came as Newsom released the budget revise this week, saying Californians should expect to see a 75% percent drop in state revenue due to a collapse of personal, corporate and state sales taxes, along with unemployment reaching as high as 25%.
Aside from military, health, and education-related entities, San Diego’s economy depends on disposable income, the kind of money spent by tourists and retail shoppers.
And that spending, the taxes, and the jobs associated with it aren’t coming back. Ever. Not for California, not for San Diego.
Our city’s convention business is never going to come back as it was. And when some events begin to happen they will be smaller and mixed with virtual participation. We should be thankful the scheme to enlarge the Convention Center didn’t pass muster with voters.
Smaller non-chain hotels are expected to close in droves. The State of California expects to buy many of those locations and gift them to cities for housing homeless people.
San Diego's inflow of humans via the airport is not going to be viable for several years, if ever. The best guess I've seen on a post-Covid19 "recovery" is 40% of previous capacity for airlines.
My back of the envelope figuring says there are about 4500 non-chain restaurants in San Diego. A New York Times story posits that 75% of those type enterprises will fail this year.
More than 100,000 retail businesses nationwide will close in the coming years as consumers have shifted to ecommerce and foot traffic in malls continues it’s already happening downward slope. Up to 90% of mall tenants have missed rent payments over the last two months.
Bigger retail outfits are in serious trouble. A New York Times story today points a finger at the acquisitions by private equity investors as being a primary cause of companies not having sufficient resources to weather this economic downturn.
https://twitter.com/Watchdogsniffer/status/1261432309841973249?s=20
Given that Kevin Faulconer is a lame duck mayor, I guess it’s only natural for him to cling to some tenets of GOP economics. Our city’s best hope in the short run is for enough parts of House Majority Leader Nancy Pelsosi’s fifth wave wish list (and maybe a few extras) to come through.
As Gov. Newsom stated on Thursday, now it’s time for the feds to deliver.
“What is the point of government, if not to protect people, their safety, and the well-being of citizens? This is an opportunity to make real our purpose & advance our values,’’ he said. “To the federal government: we need you, with your support, this is your moment.”
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Locally, we need to look closely at the general election candidates for mayor and city council to see if we find “public servants” smart enough to realize that the old models of financing and running city government aren’t going to work in a post-pandemic world.
The neo-liberal approach of letting the needs of the marketplace dictate governmental policy hasn’t worked for anyone other than the very wealthy getting even more wealthy.
There are opportunities for progressive policies within these challenges.
San Diego has already taken advantage of the diminished traffic flow to open up some streets on a temporary basis for more pedestrian and other non-motorized modes of transportation.
We need to go bigger. New approaches are mandated.
Berkeley and other cities are allowing restaurants to expand into the streets as a means of saving those institutions facing new challenges.
The Balkanization of local governance has created pits of despair (i.e. political fiefdoms tending towards NIMBYism) and siphons away revenues to support redundant layers of management outside of the realms of oversight most people understand.
I’m talking about business improvement districts and the panoply of single focus organizations. Some may be worthwhile, some aren’t. And we need local government to get back into the mode of working with the bigger picture in mind.
Joint powers agreement-type deals bring their own layers of bureaucracy and redundant public services.
Do we really need Harbor Police, for instance? Yes, I’m aware they operate in multiple jurisdictions; I just think the present way of doing things (in general) isn’t really efficient. We can do better.
Do we really need so many library systems (Not locations, I mean management?) Wouldn’t the public interest be better served with a more efficient and more accessible program?
The grand schemes of public-private enterprises, along with the decade-long privatization of services need to be re-examined.
Why are we paying for huge government public relations operations when information could be conveyed through spending money with our already cash-strapped media?
Yes, I know the freedom of the press pitfalls. But if we really put our minds to it, an equitable solution could be found.
My point isn’t to advocate for any of these specific ideas (coming off the top of my head), which may or may not be practical.
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Based on the membership of the group mentioned in this story below, I have real questions about the worthiness of this effort. They're all fine people I'm sure, but not the sort of visionaries we ought to be thinking about.
https://twitter.com/fox5sandiego/status/1261409791001399297?s=20
In the coming weeks, the task force will convene to discuss concrete strategies and policies to rebuild San Diego’s local economy, create jobs and return San Diegans to work.
Rebuild? How about re-imagine? I am saying we’re being presented with an opportunity to reimagine a government with ideas that fall outside the perimeters of drowning it in a bathtub.
We’ve got nothing but time on our hands these days. Let’s make it count for something.
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Lead image by Elliot Alderson / Pixabay