Editorial: The lessons of a recession
Editor’s Note: This is part 1 in a series of editorials about the lessons learned from the
The Sierra Sun will begin a series of editorials today that documents the lessons we have learned from watching our community understand, cope and survive the economic downturn. First, let’s briefly tell the back story.
Long after the loggers, Olympians and railroad workers began shutting down their industries around Lake Tahoe in the early 20th century, the region went bust. Without a local economy, the region leaned toward tourism and visitors, especially after the 1960 Winter Olympics at Squaw. With Silicon Valley filling up with millionaires during the 90s, selling second homes in our region became the new economic force. Real estate prices soared, and so did our local economy.
In 2007, after years of fortuitous growth, the local real estate market began to see weakness. During the five years previous, new developments needed little to get approved, and the town grew. In fact, the Sierra Sun grew big enough to publish five days a week based on real estate advertising alone.
Then 2008 happened. The international markets froze, which turned the downhill slide into a complete freefall. Just since October of last year, we have seen corporations merge, businesses close, the Sun move back to two days a week, and workers leave Tahoe for the cities.
Furthermore, a short-term decline in visitors and tourism in 2009 depleted local general funds, and prompted cuts in almost every government body and public service available.
Have we reached bottom? We’ve stopped guessing, but we know we have to be close. And we know this downturn has changed our region in ways that will take years to figure out. But we will survive, as long as we ask the right questions, and prepare the right answers.
And the big question is not whether or not we’ll see another recession. The question is whether or not we will be better prepared, and thus better protected.
Next week: Read part 2, about local pushes for diverse and sustainable local economies.