Long Islanders’ crisis of confidence – By George J. Marlin

 The following appears in the November 18-25, 2011 issue of the Long Island Business News:

Contrary to Obama administration claims that the $787 billion stimulus program and government expansion would solve our financial woes, the economic picture continues to be bleak.

Federal Reserve Chairman Ben Bernanke confirmed this view when he announced in early November that the Fed is lowering its economic growth projections for 2011 and that unemployment is expected to remain well north of 7 percent through 2014. The Wall Street Journal reported that economists it surveyed predicted U.S. gross domestic product growth would be anemic for the foreseeable future: 1.5 percent in 2011, 2.3 percent in 2012 and 2.7 percent in 2013.

In October, a pitiful 80,000 new jobs were generated, fewer than required by new entrants to the work force, never mind the millions unemployed around the country. And since the so-called recovery began two years ago, only 2.3 million of the 8.8 million jobs lost during the recession have been recovered. Unemployment has been hovering at 9 percent for seven months and has been above 8 percent for 33 months. There were 13.9 million unemployed Americans looking for work in October and a similar number has lost all hope and stopped looking for a job or is working part time.

Then there’s the white elephant that politicians are ignoring but households cannot: INFLATION. Significant increases in the cost of food and fuel is hampering economic growth. Retail prices for meat, for instance, have skyrocketed. Since 2009, the price of pork chops is up 17 percent, beef roasts up 15 percent, beef steaks up 14 percent and sliced bacon is up a whopping 34 percent.

As a result of steep increases in food and fuel staples, struggling households have even less to spend on the discretionary items that spur the economy: cars, computers, clothes, vacations, etc.

Poor economic prospects, high unemployment, inflation, the European debt crisis and a volatile stock market explain why a recent Siena College Research Institute poll indicated that in New York City and Long Island, consumer confidence is falling out of bed. The confidence index in October fell to 61.2, down 3.1 points from September.

According to Siena Institute spokesman Douglas Lonnstrom, “New Yorkers continue to see bad times, both now and in the future. No demographic group even approaches being more optimistic than pessimistic.” The poll also revealed that many New Yorkers were putting off purchasing big-ticket items they had hoped to buy in the next six months.

Gov. Andrew Cuomo succinctly explained why New Yorkers have a negative outlook: “You are kidding yourself if you think you can be one of the highest-taxed states in the nation, have a reputation for being antibusiness and have a rosy economic future.”

Pessimism is understandably rampant on Long Island. That’s because most of the Island’s economic indicators have been, of late, rather gloomy. State Labor Department data released in October indicate that Long Island lost jobs for the fifth month in a row. Home foreclosures, which began to decline significantly last December, have been on the rise since April. New vehicle purchases, which were robust in the first quarter, have been down in the second and third quarters. Since July, bankruptcy filings have been trending upward. Commercial real estate vacancies remain at all-time highs. And wealthy taxpayers are fleeing – the number of households earning over $1 million a year has dropped 35 percent since 2007.

Long Islanders are the highest taxed and most overregulated citizens in New York. Until elected officials come to grips with this crisis by responsibly governing, cutting bloated governments to the bone and eliminating antibusiness policies, expect the Island’s economy to be on a treadmill to oblivion that forces jobs and people to move to greener economic pastures far beyond the Island’s shores. Oppressive property taxes are causing even the well-off to sell their Long Island homes ahead of the race to cash in remaining equity and move to more favorable climes.

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2 Comments on “Long Islanders’ crisis of confidence – By George J. Marlin”

  1. James McHale Says:

    Efficient formation of paid fire departments might very well be a start!

  2. Pete Says:

    Property taxes are the most difficult problem we face on Long Island. The major portion of our property tax is the school tax. I believe there are something like 126 school districts in Nassau County alone. Just think of the savings if they were consolidated. As of now school superintendants make in excess of 150-200 thousand a year and retire with nice packages worth much, much more. One consolidated school district would save millions, in school superintendants salaries alone. Think of the purchasing power one consolidated school district would have, forcing suppliers to lower their prices. Another reason our school taxes are so high is the number of illegal apartments in homes where there are children who are attending our schools but parents (renters) not paying their fair share. If school taxes were based on income, not property ownership, everyone would share the costs. Instead of a deduction for a school age child, perhaps a sur charge could be levied. This way, as a family’s children left the school system, their tax burden would ease gradually. I am sure seniors would like this system. I suggested some of these points at a town meeting some years ago and was told by the local politicians that I did not know what I was talking about. I am disgusted with the current system and the career politicians that are only in office for their own gain and greed. I, for one, will not be staying on Long Island when I retire, as the taxes will drive me away. Long Island, one day, will be inhabited by the very rich, and the very poor, with no middle class left. What a shame.

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