Santa Barbara County residents have reason to feel optimistic, although total recovery from the most recent economic recession isn’t quite in sight, according to information presented Thursday during UC Santa Barbara’s 2013 Economic Forecast Project.
Using a colorful spider-web chart to show pre- and post-recession levels, forecast director Peter Rupert told an attentive audience in Santa Barbara’s Granada Theatre that aspects of economic recovery have seen steady growth but at a much slower rate than in previous tough times in the United States and the county.
“The idea of this graph shows you where we’re still hurting,” said Rupert, who is also chairman of UCSB’s Economics Department. “It’s been much slower than other recoveries.”
Rupert’s presentation was the first of the two-day event. The summit is scheduled to continue Friday in Santa Maria.
Spending appears to be increasing across the nation, Rupert said, while Santa Barbara’s gross-domestic product has grown slightly but appears fairly flat.
He pointed to recent “big activity” in the South Coast housing sales market and growth in jobs (although low-paying) as positive indicators of the slow turnaround.
Rupert’s hopefulness was not widely shared by other summit speakers, who focused attention on how the Great Recession started in the first place.
Keynote speaker and former federal prosecutor Neil Barofsky spoke about the reckless actions of banks and the complacent system that still believes the institutions are “too big to fail.”
Barofsky, author of Bailout, presented insight gained when he served as the first special inspector general of the Troubled Asset Relief Program.
“It’s like 2008 didn’t happen again,” Barofsky said. “What do we do with that financial system? We double down on it. We’re on a very dangerous path to another financial crisis.”
What started the financial crisis depends on which overly simplistic narrative you believe, said Douglas Elliott, a fellow at the Brookings Institution and former managing director at J.P. Morgan.
Rather than just blaming Wall Street or bad government policy, Elliott said everyone who took lending and other risks was to blame.
A silver lining of the discussion seemed to be that the U.S. banking system isn’t as messed up or as risky as that of European countries — yet.
Getting back to Santa Barbara County, Rupert noted that last year’s largest growers were those selling gasoline or furniture. The mining and information technology fields saw notable growth, as well as the farming industry.
Median household income increased slightly, with personal income more stagnant, and home sales and prices appeared to return to levels seen in 2000.
Rupert concluded his forecast with an encouraging graph that showed steady economic growth achieved since the Great Depression.
He said the most recent recession was but a blip in the long run.
“Indeed, the Great Recession has been great,” Rupert said. “We’re still not recovered. (But) the market is amazing. I predict there’s nothing that’s going to stop us from growing at this rate. In the whole scope, it’s not so bad. I’m optimistic.”
— Noozhawk staff writer Gina Potthoff can be reached at gpotthoff@noozhawk.com. Follow Noozhawk on Twitter: @noozhawk, @NoozhawkNews and @NoozhawkBiz. Connect with Noozhawk on Facebook.