It's the economy, stupid!

Closed for Business!That was the battle cry for Bill Clinton back in 1992. A battle cry that resonated with a nation that responded and put him into office over an incumbent president George Bush, Sr. It's a simple statement really, and while it still resonates, perhaps again now just as in 1992, it seems to be an elusive concept for our local leaders. Sure there is a lot of talk, too much talk in fact, but little progress and less action. Hopefully as we collectively engage in the system politic this year, we all keep foremost in our minds that our economy is perhaps "the" most critical issue and demand of our elected officials to abandon from political infighting and incest to deliver real bi-partisan economic solutions.

I raise this issue so forceful, because for me the "facts" are becoming all too real. The signs are everywhere, literally the business closed signs are flying up all over the place. Just in the little Plaza Centro I Shopping Center near my house in Caguas, half of the stores must be vacant, including the big hole left by last year's most impactful closing, Pueblo Supermarkets. As if that wasn't proof enough of what we are up against, recently according to The Boletin de Puerto Rico, bankruptcies exploded in 2007. During 2007, what many I've talked to call the worst year ever experienced in recent economic times, there were over 7,740 bankruptcies, representing a 43% increase compared to 2006, which had 5,425.

Notable among those bankruptcies include, the aforementioned Pueblo International, but also Fundación Dr. Manuel de la Pila, Francisco Mendoza, Inc. (Mublerias Mendoza), and Infinitio. In total, over $1,318 million dollars in losses were registered for those 7,740 businesses. In terms of the sectors most hardest hit, the construction industry had 39 cases, followed by cafeterias (29), restaurants (27), and clothing stores (24). And while the overall jump in bankruptcies was 43%, the rate of increase for commercial bankruptcies rose 70%.

Bottom line, it's bad, and unfortunately the prognosis isn't much better for 2008. Of course the elections will inject some extra money into the economy. What with all the uhum, last minute improvements by incumbent elected officials and the extra campaign spending, there may be some limited relief, but in general we are facing "mas de los mismo". All we can hope for is that our government and business leaders see that "mas de los mismo" solutions are not going to cut it. It's trite and over used, but Albert Einstein's definition for insanity still rings true (louder than ever) "we can't expect different outcomes, when we keep doing the same things." I for one am looking for some new solutions, aren't you?

Flickr Creative Commons Contributor Today: romulusnr

1 comments:

Gabriel

25 de enero de 2008, 17:36
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dijo...

"Of course the elections will inject some extra money into the economy"
You think?
Several clients of mine are bracing for a really bad year, mainly because of the election crap. And i don't mean business with a lot of government money tied up.