A recession that confounded Idaho experts, and politicians

A draft of our Tuesday editorial.

Idaho politicians and economic experts have a strange working relationship.

On the one hand, the politicos count on the economists to read the trends and help them figure out how much tax revenue they should budget. For part-time, citizen legislators, the expert counsel is essential.

On the other hand, the politicians sometimes like to trust their gut instead of banking on the experts. Never mind that those gut-level predictions may be based on anecdotal evidence — or a view of economic conditions in the home legislative district, which may or may not be indicative of statewide trends.

During the Great Recession, the experts took a bath. They seemed to agree on one point: For Idaho, better days were just around the corner. The rosy predictions never quite blossomed, the expected quick recovery never quite materialized.

The fact that the forecasts went wrong is not news — not to those who were paid to make them, and not to the politicians who were paid to factor these predictions into their decisionmaking.

What is news — and, looking forward, what is most significant — is why those prognosticators missed the mark.

As the Statesman’s Bill Roberts explained Sunday, the Great Recession was fundamentally different. Unlike downturns caused by overproduction, this was a recession marked by lost personal wealth and decreased consumer buying power. The experts also could not predict the tumbling home values — so important in Idaho, a state that had enjoyed a 20-year housing and construction boom — and shriveling credit markets.

Forecasters use history as their guide. This recession had no historical precedent. No surprise, then, that the economists struggled to predict the severity, and the duration, of the downturn.

Then again, who could have?

When politicians used their gut instincts, they fared little better. They lowballed revenue forecasts, and programs such as education and Medicaid paid the price.

In all fairness to them, the politicians were thrust into a frustrating situation, as they attempted to write budgets 18 months into what was a bafflingly uncertain future. They governed under the premise that it’s better to underestimate revenues than it is to overshoot the runway, and cut budgets later. And they seemed to believe that it was every bit as good — if not better — to make complicated decisions based on intuition rather than evidence.

Let’s just chalk it up as a learning experience all around. For experts who were reminded of the economy’s ability to behave unpredictably. And for politicians, who were shown that the eyeball test has its limits.

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Idaho wasn't alone

http://truth-out.org/opinion/item/5904

Only a handful of economists didn't follow the outdated models which didn't account for the new world economy, increased demand for oil from China, India, etc, and the shakey, if not fraudulent, financial gamble game, previously known as the international banking system.

Fairness?

Why be fair to our state politicians? Were they fair in granting the wealthy a tax break while cutting social programs, education, and wasting tax payer money on whimsical legal actions?

Read the Idaho Constitution...

They have to balance the budget and that requires making difficult decisions.

They restored $35 million to public education too. Apparently, you still need cheese with that whine.

You really believe they have a 'working relationship'?

Jeez Kevin, what planet are you living on?

They're still clueless....they'll be wandering around in a daze when HP & Micron leave Boise and the average wage drops to just above minimum, asking "what happened?"

Tom, that rhetoric of HP and

Tom, that rhetoric of HP and Micron leaving Boise is such old, old rhetoric you need to get on a different wave link. You're out of touch.

Intreating that a state

Intreating that a state perpetually controlled in all aspects by the rightist of right wing life and promoters of buy Idaho that over 2.65% of the state jobs between 2001 and 2011 have been outsourced to the People’s Republic of China.

Where's the outrage of the nationalistic flag waving conservative taters, it's very clear that trickle down economics doesn't work in Idaho, but the wealthiest of idahoans, Idaho buisness owners and Idaho's powerful business associations promote and profit off direct contact with communist china and provide no jobs or benefits to local economies, yet have been granted massive tax cuts for out sourcing and contributing to the degradation of local infrastructure and public education.

Idaho buisnesses granted exported $278 million worth of computers and electronics to China in 2011, making it its largest export to the country in 2011. Between 2000 and 2011, idahoans doing buisness with China increased by 596%, while buiness with the rest of the world bearly increased by 57%.

Idaho buiness promote trickle down econmomics at yet theynkeep,shipping jobs and doing business with the same country that all republicans demonizes and claim they hate. Where's the outrage, I guess they are to busy counting the massive profits to care about Idaho's economy.