The Associated Press last weekend reported that "economic health is in the eye of the beholder."
According to AP, the latest reports show healthy increases in economic growth, job creation, home ownership, retail sales and consumer spending, and the Dow Jones Industrial Average is at a six-year high.
But, AP says, while the president is trumpeting those gains, “Across town, Democrats are peddling a different message: Soaring gasoline and health care costs are burdening ordinary people; mortgage costs and credit-card rates are on the rise; jobs are threatened by outsourcing.” (Can’t they be positive?)
Friday’s New York Times featured a story that introduced a new phrase: “Kitchen-counter economy.”
In other words, while the economic indicators are improving, Americans still judge “the economy” by their own checkbooks. If everything’s going so well, they wonder, why is it even harder for us to make ends meet than it was a year ago, or five?
Part of the answer is that certain costs can be locked in for a relatively long term. People with fixed-rate mortgages know what they’re going to be paying every month for 15 or 30 years, and although it may be more than they’d like, there are no surprises. When they take a job somewhere else and want to buy a new home, though, the leap from that last mortgage to the next one may be breathtaking. Even if they have to finance their new cars for 72 months, they know what each payment is going to be, but cars don’t run forever. Although those costs may have been inching upward, the average American may perceive the increase in leaps and bounds.
Other costs are more difficult to budget even over the course of a year. The monthly heating bill, the price of gas at the pump, the cost of groceries (which is not unrelated to petroleum prices), ever-rising health-care expenses — those hit consumers in the wallet, and annual wage increases have not kept pace. Americans aren’t mistaken when they perceive that they’re losing ground.
“One reason the president can’t get a lot of traction when talking about the good economy is because it’s not good for everyone,” said Mark Zandi, chief economist at Moody’s Economy.com.
“If you’re from a wealthier household, the economy is performing very well. You have a job, your income is rising, your net worth is about as strong as it’s ever been,” Zandi told AP. “If you’re a lower or middle-income household, or small business owner, you’re struggling. Your incomes aren’t rising, certainly not as fast as inflation, so your standard of living is falling. You have debt and interest rates are rising.”
The mitigating factor in some communities is growth, which provides job mobility and an inflow of cash to a community. Even that rising tide fails to float all boats — growth and its effects are not factors in the Estes Valley, for example — and it’s not a force that can continue forever none the less.
Estes Park needs to consider a broader range of information than summer sales tax returns to the town government, and needs to listen to the business community when they say that, on their kitchen counters as they’re balancing their checkbooks; the economy isn’t working for them. The “haves and have-mores” carry a lot of weight with in Estes Park, but those who are not allowed to operate within the “personal lender” community have a difficult time making ends meet.
This is vitally important information to our community, as town government continues spending millions of tax dollars through the advertising department targeting the very middle - income families that are most negatively effected by the current economic trends and have done so for the past how many years? They target the demographic that can least afford to spend money to get to Estes Park and make purchases if they get here.
