Not that rainy day

As a new year opens for us, we see lots of evidence about how two major events — our economy and the weather — keep avoiding our best predictions. We know they both run in cycles, but we can never get the timing just right.
There’s nothing we can do about the weather except pray for the best and prepare for the worst. But that doesn’t work for the economy. Besides, we fool ourselves and think we can outsmart our money and predict all the good times and avoid the bad times.
To be honest, we’ve been better predicting the weather than the highs, lows and bursting bubbles of our economy. Most often we live in denial that our savings, home values or extra income will ever go down again. Instead of pray and prepare, we just spend and spend — and tax and tax.
Too soon we forget the lessons of the 2008 Great Recession, when thousands of Sonoma County families lost their homes and jobs. Local banks stopped paying dividends and whole parts of our economy, like many construction trade jobs, went away forever. Local government budgets were frozen and roads went unrepaired and some teachers took pay cuts.
Now it is 2015 and the stock market is booming and gas prices are affordable again. California Gov. Jerry Brown this week declared an end to “fiscal turbulence” and local governments and schools are cheering their “balanced” budgets. Unemployment is down and local housing prices have mostly rebounded. Happy days are here again, right? Even if we still need a lot of rain.
Not so fast, some of us might warn. Remember, what goes up must come down. That’s not just gravity talking. The best thing we can do in our recovered economy is be sure to plan for the next “rainy day.” All our local government and schools still face terrible unfunded pension problems and only a few of our roads have been fixed so far. Mortgage rates are low but rent prices are sky high. Almost all of us have jobs, but more Sonoma County workers than ever still live below the official poverty line. Our schools need repairs and our classrooms need attention.
At home, we all have some deferred repairs to make. If not, now is a good time to save some money for a new water heater or whichever appliance will break next. Funds for our children’s future education can be replenished now, perhaps, especially since Gov. Brown and others don’t seem willing yet to help with rising tuitions.
All local governments lost their redevelopment agencies during the Great Recession and they are not being replaced. These local tax districts supported our only affordable housing programs and longer range funding for local infrastructure projects. New money that might go to housing or roads is now being consumed by pension fund troubles that keep getting deeper despite an improving economy.
Whenever anyone talks about a budget “surplus” they are forgetting about the unfunded pension obligations that now equals the second-highest portion of local government budgets after public safety salaries. There is no surplus. There is only unpaid future debt.
In his State of the State address this week, Gov. Brown reminded us it was not always like this, as he harkened back to the true ”golden years” of California when his father was governor 56 years ago.
If we are to ever regain that “golden” status  we must do more than just weather a few rainy days. “We must build on rock, not sand, so that when the storms come, our house stands. We are at a crossroads,” our governor said this week. “The challenge is to build for the future, not steal from it, to live within our means and to keep California ever golden and creative, as our forebears have shown and our descendants would expect.”
— Rollie Atkinson