As the debate on the economy continues
following the last recession, optimism could soon be returning to California. Key
indicators like unemployment are beginning to show positive signs. With the
exception of a few challenges, there is hope for returning to growth.
Reasons for optimism include a declining
rate of unemployment. The September month-month drop was the highest in 36 years
(Nagourney, 2012). Many parts of the start are seeing a rebound in the housing
market with rises in new home constructions. Even the state budget is beginning
to look good with a projection that there is going to be a drop in the deficit
for the first time in many years.
Despite these optimisms, one can still
identify some ongoing problems. For one, the recovery is not happening in all
parts of the state (Nagourney, 2012). Economists are skeptical whether places
like Central California will ever join in the recovery. Poverty also remains a
serious concern for the state. It worse ranked the worst in terms of poverty by
a federal report. Problems also exist in the governing structure of the state.
The citizenry seem not to be adequately informed to make the right decisions. Even
more troubling is the fact that pension costs for public employees remains
looming.
In view of all these, one can predict a
smaller budget in the fiscal year 2013-2014. The vote to raise taxes might have
helped the budget situation. Expectations are that the state will post a budget
surplus of $1 billion as early as 2019(Nagourney, 2012). This provides a model
for the rest of the country to follow.
It would be safe to conclude that the
positive indicators are currently strong for California than their negative
counterparts. There is surely much room for optimism that the state is slated
for a rebound.
Reference
Nargourney,
A. (2012, Novemebr 27). California finds Economic Gloom Starting to Lift. The New
York Times. Retrieved November 28, 2012, from http://www.nytimes.com/2012/11/28/us/california-shows-signs-of
resurgence.html? _r=0&pagewanted=print
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