Gregoire: Don’t buy into the self-fulfilling dire talk.

Good news everyone! Although the nation is slipping into recession, here in Washington State “our economy is strong” and the only thing that can bring us down is listening to all the “dire talk.” Well, that’s what Mrs. Gregoire would have us believe, anyway

Gov. Chris Gregoire, at a Seattle economic forum Thursday, boasted she has found that Washington is “literally the envy of other states.”

“I ask all of us to make sure that we do not buy into, or even for that matter, listen to, the dire talk internationally and nationally, because it can become a self-fulfilling prophecy for us,” Gregoire said. “We must be optimistic. We must understand our economy is strong and growth is going to continue to be the future.”

The news, however, hasn’t been rosy for some local employers.

Eddie Bauer has cut 123 positions, including 76 at its Bellevue headquarters. Macy’s said Wednesday that it would cut 750 office workers from its Northwest headquarters in downtown Seattle. Wilcox Family Farms in Roy said it was cutting 130 jobs, while other employers in the Seattle area have made smaller job reductions.

And Seattle-based Starbucks, while not having layoffs, is reducing the number of store openings in the U.S. and is shuttering 100 underperforming stores as consumers are cutting back.

“Everything is slowing down on the back of the national economy slowing down,” said Andrew Gledhill, an economist for Moody’s, an analysis firm outside Philadelphia. “But it’s not all doom and gloom. Everything in Washington is slowing, but you have to put it in perspective. It’s not like other states like California, Nevada or Arizona.”

And just think, even when things do start to get undeniably bad, we’ll always be able to point to Michigan and Ohio and say “well, at least things here aren’t that bad!”

It seems to me that talk like Mrs. Gregoire’s “it won’t happen as long as we believe hard enough” speech is really counter-productive. Shouldn’t we be planning on the inevitable, and figuring out what we’re going to do to get through it the best we can? Instead of wishing on a star that the housing mess and resulting recession won’t ever hit us in the Evergreen State, why don’t we talk about things like ways businesses can scale back operations without laying people off, or helping people shape their family budget such that they can save up some money so they’re not totally screwed if they lose their job.

If we keep saying “it won’t happen here,” when it does we’ll all be unprepared and it will hurt even worse.

(Craig Harris & Andrea James, Seattle P-I, 02.08.2008)

Update: Are we really “literally the envy of other states”? A commenter below links to an an excellent article at The Economist titled The Geography of Recession. This map is included in the story:

The geography of recession

Judge for yourself whether Washington is at the top of the heap.

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About The Tim

Tim Ellis is the founder of Seattle Bubble. His background in engineering and computer / internet technology, a fondness of data-based analysis of problems, and an addiction to spreadsheets all influence his perspective on the Seattle-area real estate market. Tim also hosts the weekly improv comedy sci-fi podcast Dispatches from the Multiverse.


  1. 1
    one.person says:

    Are we really the envy of other states? We certainly look better than some, but not the best.

    Not sure how long this link will last, but it makes for interesting reading nonetheless

    From the Economist: The geography of recession

  2. 2
    The Tim says:

    Great find, one.person. I’ve updated the post with that map, as it’s quite relevant.

  3. 3
    rose-colored-coolaid says:

    Agreed on the sentiment that denial does not help the situation. How would people feel if a new computer virus was released, and the MSFT press release pointed out that the USA is still the envy of literally every other country in the world and therefore they had no plans to patch XP/Vista? Or what if a plane crashed on take-off and Boeing announced the only risk is if people start to worry about airline safety, and the best way to prevent that is by inaction.

    And yet, this sentiment, which would be shouted down if presented by any true professionals is seen as ‘strong leadership’ when it comes from politicians. UGH!

  4. 4
    vboring says:

    good thing the local economy isn’t closely tied to discretionary purchases that are likely to be sacrificed during a recession, like travel, new computers, and $5 coffees

    when MSFT spends all of their cash to buy Yahoo, then sees a bad quarter or two b/c of declining new computer sales, reduced IT department upgrades to Office, a saturated mp3 player market, and a slower gaming console market, there could be layoffs, or at least slower hiring.

    boeing’s exposure is obvious. when business slows, business travelers travel less, and recessions lead to cheaper more local vacations. both are obviously bad for new airplane sales.

    and starbucks has run it’s course. the $5 coffee was a great idea, but now everybody offers them, so why go to starbucks? they use push-button machines just like McDonalds does, so there is no product differentiation that i can see.

    so, who exactly is it that thinks we have an impervious local economy?

    other than our delusional Governor.

  5. 5
    old_B says:

    What is she supposed to say, “Attention citizens, we’re F’ed, and MSFT, SBUX, and Boeing aren’t going to save our asses”?

    I think this is straight out of playbook for any politician. I guess I don’t get the outrage.

  6. 6
    The Tim says:

    I gave some examples in the post of the kinds of things she could say that would demonstrate good leadership. IMO, just because this is the standard MO for politicians doesn’t mean we should all be cool with it.

  7. 7
    Markor says:

    Gregoire is right except for the “don’t listen to it” part. A recession, at least the severity of it, can indeed be a self-fulfilling prophecy. No reason not to pay attention though.

    Most of the states having lower unemployment than WA likely pay a lot closer to minimum wage. The unemployed in WA need to hold out for higher wages.

    Starbucks coffee sucks. McDonalds coffee, which locally is Seattle’s Best Coffee (owned by Starbucks!), is superior. I agree, when it’s pushbutton, why pay more? Tully’s is pretty good; I hope they survive. Fortunately there are some mom & pop places that serve the real thing.

  8. 8
    vboring says:

    what if she said something closer to:

    “we can see uncertainty in the national economic landscape, but we are confident that innovative Washington businesses will help us pull through. meanwhile, we are having a look at the budget and preparing for possible difficulties to ensure that services will not be disrupted, not matter what happens”

    i don’t care what the governor thinks of the local economy. she is not an economist, so why should i? i do care what she is doing or thinking about doing with the state budget, services, and taxes.

  9. 9
    Thaxter says:

    Unbelievable article! A must read.

    Lawrence Yun says Seattle homes are underpriced, and that the typical worker here making $47K per year can easily afford the median home price!

    Un friggin believable!!!

  10. 10
    patient says:

    It’s pretty frightening how the gap between market reality and the spin and propaganda from politiicans and the re-industry exponentially widens as reality becomes more dire. It exposes an industry and web of lobbyist. If you wonder how otherwise sane people could be lured into the mortgage mess look no further. Also check out Ben Jones’s blog today. Statements of a Seattle market bottom and that we are underpriced. Lawrence Yun is on it with the superstar card again. At the same time back in the land of reality we continue to grow KC SFH inventory by about 40 units a day. One thing is for sure, before this is over the re-industry is going to have zero credibility with anyone.

  11. 11
    patient says:

    I think Glenn Kelman at Redfin has understood the enormous opportunity he is given on a silverplate by the traditonal re-industry here by not only adding transparency with things like sale and listing history but also predicting the inevitable price decline. This will set Redfin apart as being credible and consumer friendly.

  12. 12

    I just don’t get it why Gregoire needs to say these things? Is she trying to get the endorsement of the Board of Realtors?
    Yes, unemployment may be a bit lower here, and yes, home prices here have not dropped as much as some other places, but it doesn’t give me a lot of confidence knowing that our governor refuses to see reality.

  13. 13
    patient says:

    Ira, probably the same reason as the realtors. Short term thinking and fear for what happens when the market tanks. The problem is that this market can’t be saved by talk or positive thinking. It has fundamental and very real issues. To prop it up now is like raising the platform you inevitable need to jump from. The landing is going to hurt even more.

  14. 14
    DoRulesApplyToMe says:

    At the bottom of “The Economist” web page I see:

    “Copyright © The Economist Newspaper Limited 2008. All rights reserved.”

    Does this web page have an agreement with “The Economist” to use the slick map which obviously took them some time to produce?

    Because now that this is a “for profit” web page, doing so without permission can be consequential.

  15. 15

    There’s nothing wrong with positive thinking, but this akin to the Governor asking all of Washington’s citizens to all join hands and sing “kumbaya’, or that we all pray in unison to destroy Osama bin laden.

  16. 16
    The Tim says:

    I’m no lawyer, but I’m pretty sure the usage of the graphic on a blog like this, for-profit or not, falls under fair use.

    Here’s a page from the EFF that addresses issues like these.

  17. 17
    Dave says:

    Good point to be made about the map. Tim – welcome to the world of liability, slander, copywrite infringemnet and liable. Do you have an lawyer yet? Since now you will be making money, you now have a target on your back.

  18. 18


    The world is going to pot all around, but if if I’m in denial, its not that bad at all.

    I’d add, none of the Dem/Rep politicians (Governor, Senator, Congressman or President) offer pragmatic specific solutions during their campaigns.

    Maybe that’s how they got picked by the dumbed down elite?


    Clogged Freeways
    Water Shortages
    Crumbling Bridges
    Dumbed Down Public Schools
    Out-sourced Manufacturing
    Imported and Tainted Food
    Massive Service Economy Layoffs

    Etc, etc, etc…..of course the root cause of all this unanswered mess is overpopulation making it worse….but God forbid we offer pragmatic solutions during a hotair political campaign!!!

  19. 19
    Mike2 says:

    Just for comparison, Northern Virginia (part of one of the “green” states on the map) has an unemployment rate sub 2% – but the counties are running a major budget shortfall and housing prices are sliding hard despite having the highest median incomes in the country.

    …then there’s Seattle. At least the housing market there hasn’t crashed yet.

  20. 20
    AndySeattle says:

    I’m all for positive mental attitude but The Tim brings a good point… Let’s be realistic ; a storm is coming.

    To Gregiore, if she really wants to be positive she should be introducing methods to spur growth through the recession. Instead of preparing for a wind storm by tying everything down, why not prepare for a financial storm through calculated risk and growth? Her denial brings far more risk than at least attempting to something different.

  21. 21
    greenthum says:

    Gregiore’s “no bad news” assessment of Washington State’s economy is ridiculous! She doesn’t dare let on that there’s trouble brewing otherwise the citizens might start demanding lower taxes and smaller government.

  22. 22
    redmondjp says:

    Let’s face it. The economy is doing just fine until YOU lose your job. Then times are bad! How many gov’t workers do you see around the Seattle area worried about getting laid off? I live in Redmond and just read the city council meeting minutes from the end of last year–hey, all of the union AND exempt workers at the city got their automatic annual cost-of-living increases, now did you?

    I sure as he** didn’t!

  23. 23
    wldlndff says:

    Good point redmondjp government employee’s probably are a little more comfortable when the economy is slow, but we are still vulnerable. In my case I started working for state government after obtaining my bachelor’s, and the salary they offered me was just under 30K and has not raised much since then(wow good thing I went to college). Yes, the last couple of years we have received salary increases(6.4%) but the last time before that was 2000. Oh wait can anybody tell me how much inflation increases each year….3-4%? Government wages hardly keep up with inflation in my case. Although we have different employers I would like to think we share similar values… affordable housing, lower taxes and job security to name a few. Do I agree with gov. greg… no! Do I agree with L. Yun… no. Do I think that housing prices will fall to a more sustainable level….Yes!

    P.S. The agency I work for actually generates funds(timber) for schools, universities, prisons and other government funded projects. For example a high school I know of is being built for 25mm but the tax payers in that district only have a bill of 16mm the rest is being picked up by the agency I work for.

  24. 24

    […] Let’s not forget that official state policy appears to be “close your eyes, plug your ears, and wish your problems away,” as laid out from the top by Christine Gregoire. […]

  25. 25

    […] I guess everybody must have ignored Gregoire’s advice and bought into the self-fulfilling dire talk. We should have tried to believe […]

  26. 26

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