There are a number of sobering assessments surfacing concerning the economic crisis and its impact on regional economy of New York City and the Tristate area.
One estimate is that the reconfiguration of the banking industry will result in 100,000 high paying job losses in the Tristate area. That includes NYC, Northern New Jersey and Southwestern Connecticut. I originally thought that figure was a bit high but when you consider that a bloated Citibank can lob off 10 to 20 thousand jobs at the drop of a pink slip it might not seem too drastic a prognostication. I’m not sure if this figure includes ancillary businesses that are sustained by relationships with banks and their employees but whatever the composition of the number it will have a major impact on the regional economy of the Tristate area.
Job losses will remove significant buying power from the local economy. It will place added strain on the housing market, erode usage fees of buses, trains and road tolls and will curtail sales and property tax receipts. This will put enormous pressure on state and local governments and public school districts to deliver vital services like education, police, ambulance, road maintenance and other public services.
Another labor market statistic I learned was that the economic crisis will result in the loss of 30,000 construction jobs. This number according to some economists is an optimistic “soft landing” prediction for the industry. The construction industry is a major driver of jobs and economic activity in the Tristate area. As personal income, business revenue and tax receipts abate demand for new housing construction and renovations, commercial buildings and public works construction and infrastructure improvement and maintenance will decelerate.
The financial services industry shepherded America’s economic transformation to a services based economy. This transformation strengthened the banking industry by creating an economy that became increasingly dependent on the manufacturing of collateral such as housing construction and real estate development projects. This development allowed banks to finance more leverage in the credit markets and created the credit marketing frenzy of the last decade. America’s banking system exponentially expanded to accommodate the Titanic growth of the credit marketing industry. But like the Titanic after it hit the unforeseen sub-prime iceberg the industry has way too much capacity and needs to downsize as lending activity sinks into the black depths of recession.
New York City has long been considered the center of the worlds financial system. The downsizing of the banking industry is the equivalent of the shut down of steel mills in Pittsburgh and the closing of car manufacturing plants in Detroit. Citibank and Merrill Lynch are the General Motors and US Steel of NYC.
Music Video: Gene Kelly & Frank Sinatra, New York, New York
Risk: public services, banking, regional recession, cities
The flood of Cedar Rapids seems like an ugly rerun of the Katrina disaster. Hospitals are being evacuated, homes abandoned, businesses closed, commerce halted and a community is in acute distress.
The City of Five Seasons, population of 120,000 boasts a strong economy, rich culture and engaged citizens whose civic pride and community involvement is the city’s greatest asset. It is a great city of The Great Plains and its people will rise to the challenge to rebuild itself. The Cedar Rapids Chamber of Commerce lists 1700 members. Some will do well as a result of this flood. Construction companies, waste management firms, building suppliers and others will find opportunity as the flip side of this risk event.
This extreme risk event however, may prove to be a coup de grace for small businesses already stressed due to the slow economy and inflationary pressures. As this incident unfolds the disaster response agencies FEMA and the Department of Homeland Security will be closely watched to see how they perform in their recovery and restoration efforts. We wish them well.Floods and their destructive aftermath are becoming a cruel joke on the American people because these types of events can be mitigated. I am of the mind that the severity of geo-risk events can be mitigated by investing in the country’s infrastructure like levees, dams and other engineered solutions.
It is a question of priorities and all citizens should ask why the Federal Government continues to ignore the crumbling infrastructure of this country? Why must needless lives be lost, businesses bankrupted and communities destroyed because the priority seems to be an open checkbook to fund the prosecution of a war that is exhausting the political, emotional and economic capital of this nation.
The administration spends over $10 billion dollars a month to bolster the failed state of Iraq in their nation building project. What they seem to have forgotten is that the infrastructure of the USA is worthy of this type of investment and certainly demands its undivided and immediate attention.
Consider what New Orleans cost this country and the many billions of dollars we continue to spend to partially recover from the Katrina disaster. Consider what the return on investment a $1 billion improvement project to upgrade New Orleans’s antiquated levee system prior to Katrina disaster would have yielded the American taxpayer? Not to mention the avoidance of the utter devastation of a great American city and it’s people.
That’s the hallmark of true leadership. Leaders need to offer solutions to problems before they occur. Unfortunately, current leaders are too preoccupied with other priorities and immediate returns on political capital to propose solutions that look beyond the next election cycle or special interests checkbooks.
Today in Cedar Rapids the front line in the war on terror is being fought against an unrestrained river that is carrying away lives, fortunes, dreams and the personal security of citizens that only a strong, vibrant and stable community can provide.Yes, infrastructure is an area where government matters. Being anti government, anti tax, anti federal bureaucracy are nice radical platitudes that play on voters political suspicions and partisan sentiments; but eventually the bill comes due at all to often too high a price. This country can ill afford to lose another city.
All politicians should note, as the Cedar River rises’ so too does the personal anguish and political discontent of our citizens. We pray for their safety and full restoration.
Here is another version of Five Feet High and Rising by the great Johnny Cash.
Risk: geo-risk, small business, political, infrastructure, opportunity, community, culture, ROI, opportunity cost
On the morning of September 12, 2001, I awoke in an AIDS hospice on Washington Street in Lower Manhattan. The day before, I was one of the thousands of refugees fleeing the terror from the World Trade Center bombing. Unable to leave the island for my home in New Jersey, a Nicaraguan Nun from Mother Teresa’s Order of The Missionaries of Charity saw my distressed condition and took me into their care. They gave me something to drink, washed away the terror dust from my body, fed me, put me to work in the kitchen to feed the residents and gave me a bed for the night. That day I experienced the worst and the best of humanity and witnessed two radically different interpretations of how people act out of what they perceive to be God’s commands.
That morning I awoke early to join the Sisters for Morning Prayer. It was led by a Priest from the Bronx and after the prayer service we spoke over coffee in the hospice kitchen. He bummed a cigarette from me and recounted the death of the Catholic Priest Mychal Judge and how they laid him on the altar of St. Peter’s just hours before. He offered a simple homily “sic transit gloria mundi,” the glories of this world are fleeting. He explained that these words are recited by a bare footed boy running alongside a procession carriage conveying a newly elected Pope in front of the cheering throngs of devoted Catholics. It’s a good reminder of how we perceive permanence and immutability and how it can all evaporate in the wink of an eye.
That terrible day as I stood peering into the gaping entry wound of the south tower and witnessing jumpers cascading down to their decisive deaths, I continued to wonder how they were going to put out those blazing infernos 110 stories up. Like everyone else, we never considered the likelihood that those buildings could fall. The idea of American indomitableness was the largest casualty on that day.
I felt compelled to recite the same words to my friend, rabbi and spiritual mentor on the night before his consecration as the Eighth Bishop of the Episcopal Diocese of Rochester, the Reverend Dr. Prince Singh. It’s not that Rev. Singh lacks humility or is trapped inside an inflated ego or offers a false piety. Indeed if Rev. Singh has vulnerability it is his infinite accessibility and his unfathomable compassion. Bishop Singh’s faith is deep, real and compelling. It is exposed like the iconic Sacred Heart of Jesus, tender, vulnerable, large, life affirming and open to anyone wishing to partake in an ever deepening walk with Jesus Christ. He is a true pastor and I pray that his pastoral gifts are not lost amidst the responsibilities of a ministerial higher office.
Our past glory, Father Singh, as our parish Priest is now gone to the Great Lakes region to continue his ministry on a higher level. I now know how his former Dalite parishioners and his family felt when Father Singh left India to begin his ministry in the United States. I believe that divine providence has brought this great man to Rochester. This great city, once a sparkling jewel of American inventiveness, entrepreneurial spirit and industry now faces great challenges to revitalize and reinvent itself in a post industrial economy. Who would have believed a scant 10 years ago that premier corporate brand names like Xerox, Eastman Kodak and Bausch and Lomb’s business fortunes could be so fleeting and so drastically change? Bishop Singh will contribute to the rebirth of this region. His ministry can weave together the many elements and talents needed to bring forth a new and vibrant community fabric. That’s what great pastors do.
On 9/11 Father Singh was the last of family and friends that I spoke too before being consumed by the conflagration and civic turmoil of that day. After watching the towers burn I returned to my office at 25 Broadway. My phone was ringing. It was Father Singh. He found me and advised me to leave the city. He was relieved that I was unhurt and he promised to contact my family to let them know I was safe. A good pastor always finds his lost sheep. Though I had yet to face my greatest danger of that day, and I would not be in contact with my family until my return home the following day, Father Singh’s contact would assure my loved ones that I was alive and on my way home.
I believe that Bishop Singh’s installation signals that Rochester and its greater region have an opportunity to bring forth a new and vibrant community on a great lake. Just like Mother Elizabeth the Nicaraguan Nun who took me into her care on 9/11, Bishop Singh will water the seeds of growth, will wash away the dust from the city’s broken past, feed the hungry with spiritual food, put the beloved to work in God’s vineyards and see that the weary have a place to rest. It’s what great pastors do.
With God’s help a change will come to the fortunes of this great American city. Our prayers are with you Bishop Singh. May God continue to richly bless your ministry.
You Tube Video: Sam Cooke, A Change is Gonna Come
Risk: unbelief, pessimism, product risk, urban renewal, terrorism