Shutdown ends, clock starts again while California looks to change game

150 150 John Guenther

Entrance at Yosemite (Photo Credit: Jeremy Zawodny/Flickr)

While the shutdown is over, it seems the federal government kerfuffle will be giving economic reporters plenty to write about for months. We don’t need to go over the “fun” facts that the National Zoo’s Panda Cam is back–like every other story has–and how people actually looking to escape to Alcatraz, instead of from, finally could visit the island.

And business columnists continue to feel the echo of the shutdown, as the California Employment Development Department had to postpone its Friday release of employment numbers for September.

Now, if we want to talk about the actual effects to the California economy, even though the final tallies have to be made, you can easily split them into two groups, those from during shutdown and post-shutdown, which actually might have a greater impact on the economy.

Digging out of a backlog of work are federal employees like Small Business Administration workers who were unable to assist small businesses here in California.  “There are probably a lot of overflowing inboxes of voicemails and emails today,” Jesse Torres of the Los Angeles Small Business Development Center Network said to KPCC.

The shutdown caused multiple drags on the state’s recovering housing market, with loans delayed and the unavailibity of data slowing sales.

On the brighter side of things, Visit California sent out a press release to let people know about what the end of the shutdown means for the California economy and to entice people to visit the state and national parks here.

The tourism nonprofit had released data back on October 1 that showed visitors spend $292 million every day in those parks, public lands and areas adjacent to them in California.

Also affecting the economy during the shutdown, federal workers most likely were not able to make a lot of purchases or buy rounds at the capital bar. Now it seems the damage that is still being done, post-event, is from the uncertainty. Consumer confidence has been shaken and the business community now gets to eye the clock as the new shutdown deadline of January 15 approaches.

Standard & Poor’s estimated that the shutdown and debt ceiling faceoff cost the U.S. economy $24 billion for the last quarter of the year. 

Here in California, there’s a growing sense by some that the state needs to start looking at solving its own issues, shutdown or no shutdown, with a look at regional and holistic way that cuts across jobs, housing, health, and maintaining the environment. Getting creative to gather funding for infrastructure projects as federal help seems less certain, is just one of those puzzles to solve.

Lt. Gov. Gavin Newsom said in front of a gathering of Summit Action Team members this week that traditional top-down thinking with solutions coming from on high is getting a run for its money from grassroots, bottom-up efforts.

The California Economic Summit has adopted that regional approach, drawing the best ideas to the biggest challenges from the local level rather than from the top of the state.

“The pyramid has been inverted, and the world that used to exist—where the people on top used to sell down their vision—that day is over,” said Newsom.

Attendees at the meeting commended the Summit for thinking about economic development in a new way. The goal of this year’s Summit, say Action Team members, is to change the development game by considering how the state can simultaneously create more and better paying jobs, sustain the environment, and make sure all Californians have an equal opportunity to move up the ladder. The 2013 Summit will get started on November 7 with the main Summit activities taking place on November 8, just 3 weeks from now.

And while the country watches the next shutdown clock tick down, at least gas prices are down, and the Economic Summit continues to work for the 40 million people here in California.


John Guenther

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