Otter wouldn't vote for stimulus bill, though he thinks it will boost Idaho's economy

Were he still in Congress, Gov. Butch Otter says, he probably wouldn’t support the economic stimulus package now being prepared by the incoming Obama administration.

“Somebody would have to be more convincing than they have so far,” Otter told me Thursday at a gathering of reporters and editors with state leaders in advance of the legislative session.

But he still thinks the stimulus would boost employment. “It would help us a lot catching up in the short term,” he said.

Otter was somber about the state economy Friday in a separate interview with three Statesman reporters published in Sunday’s edition. The buoyant optimism that has characterized Idahoans’ outlook has evaporated over the past nine months, he said, as thousands of people have been thrown out of work.

The governor will unveil his 2009-2010 budget proposal at 3 p.m. Monday. It promises the deepest slashes in state spending Idaho has seen in many years. Otter won’t propose a general fund tax increase to balance the budget — even the Democrats’ legislative leaders don’t think this recession is the right time for that.

Nonetheless, we should expect Otter to stick to his insistence on more revenue for the highway fund, even though that money largely will come out of the same Idahoans’ wallets as a sales- or income-tax increase would.

And we should expect fierce resistance to cuts among legislators passionate about protecting particular programs, like full funding for public schools. It’s a safe bet that lawmakers will tap some of the state’s rainy-day funds by this session’s end even if Otter doesn’t want to — and his statements so far suggest he doesn’t.

Lawmakers who came to town last week for the Legislature’s annual pre-session economic-outlook hearings endured one gloomy report after another from state, private and university economists and from most business sectors. No sooner had their two-day hearing ended than Friday’s unemployment report came out, showing a nine-tenths of a percentage point jump in December joblessness in Idaho.

With each passing week, the consensus of economic and political opinion — national and local — has grown more pessimistic. Just a few weeks ago, some local business leaders were hoping for an upturn by the second quarter of 2009. Now the most optimistic voices are looking to the third or fourth quarters.

Bob Geddes, the Senate president pro tem from Soda Springs, suggests that’s still wishful thinking. He doesn’t expect a turnaround even in 2010. “I’ve heard no evidence, no data, other than optimism, that that will be the case,” he said.

In the next few months, even with the likely passage of Obama’s super-stimulus plan, we Treasure Valley residents can expect local unemployment to rise even higher, home prices to keep falling, Micron to keep losing money at a frightening rate, and retailers to keep closing their doors. Count yourself lucky if you are, or work for, a recession-resistant employer. Most Valley residents will do well to get out of 2009 with jobs intact.