Speaking to the Northgate Chamber of Commerce and Lynnwood Rotary Club, AWB President Don C. Brunell said that while the recession shows signs of bottoming out, there are storm clouds on the horizon that could disrupt the recovery.
Brunell pointed to the latest state revenue forecast which is $760 million under projections. For over a year, state tax collections have been below forecasts and now the gap between revenues coming into the state and the money need to pay the bills is $2.6 billion. "We need to find more state revenues through stimulating the private, taxpaying sector, not by raising taxes, fees and the costs of doing business!"
Second, Brunell said a recent report from Reuters that a record one in seven U.S. mortgages were in foreclosure or at least one payment past due in the third quarter is very troubling. Reuters reports this fresh data signaling the recovery in the housing market will be tepid at best.U.S. mortgage delinquency rates and the percentage of loans that entered the foreclosure process also jumped to records from July to September, the Mortgage Bankers Association said on Thursday.
Rising job losses were behind the increasingly bleak portrait of the housing market in a trend that will continue into next year, the group said in data that adds to recent evidence of a still-struggling housing market.
Third, Brunell said while unemployment numbers seem to be stabilizing, a disturbing fact behind the numbers is many Americans are giving up their job searches in frustration from the lack of jobs available.
Fourth, many states, which balanced last year's budget on federal stimulus money, are seeing that one-time money disappear with no replacement money coming in. This blows a huge hole in the ships of state. Washington is among the states which took one-time federal dollars which disappear in the next year.
Fifth, many state and local governments have a rapidly growing pension crisis as baby-boomers start retiring, investment returns have fallen farther and farther behind necessary reserving requirements, and elected officials and lawmakers have had to chose between balancing operating budget and raising taxes (or cutting pension costs) to adequately reserve for public worker retirement payments.
Finally, Brunell said the most important thing people can do right now is contact President Obama, Congress, Gov. Gregoire and state lawmakers and tell them to focus on fixing the economy and increasing private sector jobs. Passing hugely expensive new federal and state programs only sets us farther behind, Brunell concluded. "It is a healthy private sector which will lead us back to lasting recovery and add the jobs we need today and for our children and grandchildren."
