The world has been nervously eyeing the U.S. economy lately, wondering if it\u2019s winded, dead, dying, or just playing possum. Saipan, as a card carrying member of the world, is linked to the U.S. both directly and indirectly, visibly and invisibly, and our Uncle Sam\u2019s financial health is always a matter of importance on our fair shores.<\/p>\n
So what\u2019s the deal with Uncle Sam? Is he winded from his 10-year economic boom?<\/p>\n
Yes, he is.<\/p>\n
Will he fall on his face?<\/p>\n
Energy shocks notwithstanding, no, I don\u2019t think he will.<\/p>\n
He hasn\u2019t even fallen to his knees, but the labor force is sure wobbling a bit. My last tally showed about half a million job losses, via either layoffs, work force reductions, or similar bummers. Of course, some of these jobless will find other jobs.<\/p>\n
Some, however, won\u2019t. Not for a long time, at least. If the old rule of thumb of one-month-per-ten-grand-in-yearly-salary still holds, somebody making, say, $50K a year at his last job will spend five months hitting the bricks in search for the next. That\u2019s not a scientific rule of thumb, by the way, so don\u2019t hang your hat on it, but it\u2019s sort of a handy guide nonetheless.<\/p>\n
Meanwhile, economic growth for the first quarter of the year rolled in at 2 percent. Hallelujah! Most of us\u2013or at least the crowd I hang with\u2013was projecting pretty grim numbers; I was saying 0.8 percent growth.<\/p>\n
What the heck, I\u2019m going to roll that number over, and stick with 0.8 percent for the second quarter, since I don\u2019t think the energy shock has really manifested in the economy yet, nor do I think the household sector can continue to spend money like a boozed-up sailor in Garapan. In summary, both the supply side and the demand side might have some slowing activity in the second quarter (and we\u2019re already in the second quarter).<\/p>\n
Two percent isn\u2019t much growth, but it was a pleasant surprise, since many of us had lower expectations.<\/p>\n
In the long run, I\u2019m not as optimistic about the United States economy as a lot of people are. Government will continue to grow, and will keep claiming a larger share of resources, while an aging population is going to find itself trying to live on the shoulders of a very different socio-economic reality. There is an economic generation war brewing, and it is going to be ugly.<\/p>\n
But that\u2019s a topic for a different day. For now, Saipan, like everyone else in the world, is relieved to see that at least the U.S. tallied some real economic growth at the start of the year. Meanwhile, the CNMI economy is still in dire straits, and there\u2019s no relief in sight.<\/p>\n
Ed Stephens, Jr. is an economist and columnist for the Saipan Tribune. \u201cEd4Saipan@yahoo.com\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"
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