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Posted on 03/27/2002 7:29:48 PM PST by kattracks
LOS ANGELES, Mar 27, 2002 (United Press International via COMTEX) -- Predictions of a continuing sluggish California economy contained in a closely watched report issued Wednesday may add to Gov. Gray Davis' political woes as long, hot summer campaign season approaches.
The UCLA Anderson Forecast predicted that while the threat of major job losses in the state may have faded, California is unlikely to see a sizable gain in employment or personal income until at least the second half of the year.
"By our rationale, using personal income as a barometer, there is little doubt with the recession or not, that California fell further than the national economy during the last three quarters of 2001," senior economist Tom Lieser said.
UCLA's gloomy predictions of a stubborn recession in the Golden State quickly drew a quick and sharp response from Republican gubernatorial candidate and businessman Bill Simon, who will try to oust Davis in November.
"Today's UCLA report that our economic recovery is faltering is more proof that the governor's three-year assault on job growth has succeeded in slowing down our economy," said Simon, who has taken the traditional GOP stance that Davis has cultivated an unfriendly business environment in the state.
Davis could have used better news. He has had his hands full in recent months as California continues to weather the fallout from the state's electricity crisis and dot-com collapse as well as a $12 billion budget deficit that was recently re-estimated as high as $17 billion. As of April 1, information services will no longer be subject to state sales tax, which will cut off another revenue stream leading to Sacramento.
Earlier this month, the governor postponed the phase-out of the gasoline additive MTBE for a year in order to avoid a possible surge in pump prices. While claiming the need to protect the "little guy," the governor was still forced to back-pedal on a high-profile environmental protection initiative that he himself had ordered back in 1999.
Simon stated that Davis had raised energy prices and "repeatedly signed job-killing legislation."
"Meanwhile, our economy stumbles and average people worry about their jobs, their children's schools and their high energy bills," Simon declared. "In the midst of a slow economy, you can't continue to paper over our massive budget deficit as if it isn't there. I call on Gray Davis to deal with the important issues facing our state."
According to UCLA, a growth in tech sector jobs could begin in the second half -- just in time for the campaign's fall home stretch.
"A pickup in computer services and personnel services will bring about a resumption of growth in business services," said Lieser. " High tech employment in electronics will add jobs at a modest pace."
According to Lieser, California was hit harder than the rest of the nation by the recent mild recession, although real estate values remained strong. That strength, however, could be tempered by rising interest rates and increases of less than 1 percent in both employment and personal income.
"California's recovery will be subdued," said Lieser. "It definitely won't be what it was in the '90s."
UCLA Senior Economist Edward Leamer noted that spending on consumer goods and real estate remained relatively steady nationwide, which may have prevented the recession from becoming even deeper, but also makes it less likely that a surge in new spending will occur and kick start the national economy.
Leamer predicted that an economic turnaround would depend largely on the growth of business capital investment, which by nature is a longer-term phenomenon.
"Business investment in pursuit of technological innovations has long waves that last a decade or more," Leamer opined. "It is highly unlikely that there will be a sharp recovery of business investment in the next year or two."
Technology, in fact, has also contributed to current woes in the economy by drastically increasing competition in retail and similar sectors without adding much to the bottom line of the companies.
"The Internet has fundamentally changed retail competition, affecting especially the capacity-dependent sectors including hotels, airlines, autos, PCs, wireless and so on," Leamer said. "The ability of customers to shop (online) without cost greatly increases the intensity of competition."
By HIL ANDERSON
Copyright 2002 by United Press International.
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Davis Continues to Ignore Economy
UCLA Study Cites Faltering Recovery
SACRAMENTO - California gubernatorial candidate Bill Simon today criticized Gray Davis for failing to offer a plan to stimulate California's sluggish economy.
"Today's UCLA report that our economic recovery is faltering is more proof that the Governor's three-year assault on job growth has succeeded in slowing down our economy.
"Gray Davis has repeatedly signed job-killing legislation, he has raised energy rates, and he has left our state with an estimated $17 billion dollar deficit. Meanwhile our economy stumbles and average people worry about their jobs, their children's schools and their high energy bills.
"In the midst of a slow economy, you can't continue to paper over our massive budget deficit as if it isn't there. I call on Gray Davis to deal with the important issues facing our state," said Simon.
"When I watch the Governor try to change the topic from important issues such as the economy, I am reminded of four historic words," said Simon strategist Sal Russo.
"It's the economy, stupid."
###
________________________
BILL SIMON FOR GOVERNOR
770 L Street, Suite 950
Sacramento, CA 95827
Website: http://www.SimonForGovernor.Com
Ah, but they won't, not with the lousy economy. I'm from there, and Ca. voters are schizophrenic, meaning they will turn on their socialist Gov. and his broken promises like a woman turns on her no-good ex-lover. I mean the moderate Dems and Independents... the Repubs. of course never were fooled, while the hard-core leftists think four more years of Premier Davis is just what the state needs. Someone should encourage Ralph Nadar to make a run from the left of Davis, heh heh.
So nice to see the Gray One's total ineptitude when put on the defensive. Maybe he can get Gary Condit to go stumping the state on his behalf, BWAAAAAHAHA.
You are SO right. In March of 2000 all the bond measures failed; in March of 2002 they all passed ... yet we still nominated the conservative on the ballot, Bill Simon, but a huge 18 point margin.
Go figure.
Anyway, Davis is trying to make an election that is about the economy and the fiscal order of the state into an election about abortion, and it's not going to fly. People just don't care about abortion (I'm sorry), but it's true, and Davis is mistakening the reason that Lungren lost by 20 points. He THINKS it's because Lungren was pro-life. Let him think that. It's will help us to defeat him.
Go Simon!
Last year they said that California was in a recession before the rest of the country and would take longer to get out of this recession.
Fascist Davis and his brown shirted fascists in Sacramento and the mediot/pressitutes down played the UCLA report last year and made fun of it.
Actually, the recession kept us from having more blackouts. When businesses close or reduce hours, they use less electricity.
Simon's people need to explore how the recession kept us from having more blackouts. There is a lady Prof at UC Berkley (I can't remember her name), who pointed this fact out last year.
Quite true. Good thing Davis wrecked the economy, huh?
Actually, I fear for Simon when he wins this election. A lot of the damage Davis has done won't really be felt for another year or so.
And since Davis has run off all the power producers, when the economy turns around, the lights will go off again.
Yes, Fascist Davis's strategy to keep the lights on was to cause a massive California recession. When the recession came and businesses closed or reduced hours, that left electricity for the rest of us! Way to go Davis, you kept the lights on by causing a recession!
Simon will face problems due to the lack of no new power plants thanks to Davis, the hand puppet of the economic terrorists, the enviralists who hate any power plant, particuliarly a new one!
You know, I was thinking just this thing as well. All the smoke and mirrors Davis has used to keep power are going to disappear. Simon has his work cut out for him. But the fact is, we can't let Davis have another four years to bankrupt this state. Simon may be working for his entire term to fix the problems created by Davis, but if we want a prosperous state, we'd better do something about it now.
"Someone told me there's a girl out there with love in her eyes and flowers in her hair..."
...and she's sick of Gray Davis so she's re-registering as a Republican and voting for Bill Simon.
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