Now That Calpine Has Left, What About Our Economy?

3/22/04 Now That Calpine Has Left,
What About Our Economy?
by Jason Whitcomb

The community spoke and Calpine withdrew, but what about our economy?

Tuesday’s City Council meeting was quite an event. As I approached the Eureka Municipal Auditorium I had to wade through petitioners, protesters, citizens and police.

As the meeting progressed, it was clear that the people of our small community did not want to risk their safety and way of life to let this outside interest develop our bay.

Of the 20 or so proponents of the LNG project who spoke to the council, there were some fallacies and there were some facts.

Since Calpine had the integrity to listen to the people’s voice and withdraw its proposal, these truths and myths no longer matter.

What does matter is the underlying theme in each proponent’s message: we need to focus on the economic future of Humboldt County. This is a truth and it is a belief shared by most every member of our area. The looming question is how?

The first step in answering how is to look at the history of Humboldt County. Steven Hackett summarized our economic history in 1999¹.

In the 1950s the timber industry hit its high point employing 50 percent of the county. In the ’60s, the economy started shifting away from timber toward services. This movement continued through to today, also paralleling increases in retail, public-sector and manufacturing jobs.

In 1997, lumber-based manufacturing was responsible for less than 10 percent of county employment.

While our heritage is rooted in the timber industry, it is clear that our future is woven in diversity. As any wise investor will tell you, diversity is key to economic stability.

Our next step is to look at the present.

When the painfully overinflated dot-com bubble burst, California took the hardest hit. Then the terrible events of Sept. 11 occurred, causing further economic instability, which continues through today.

It is common sense that if the stock market is floundering, one should invest in real property. This demand in property and housing drove local home prices higher and higher.

Then Alan Greenspan sunk the interest rate and local housing became unaffordable for far too many residents of the community. At the current time, home affordability is down to 33 percent of local residents² and countywide unemployment is at 7 percent³.

Of the households in Humboldt, almost 14 percent live below minimum-wage standards and more than half live below a living wageª.

This is legitimately scary stuff. I understand why a woman was in tears pleading for the City Council to consider Calpine.

But Calpine wasn’t for us. It was clearly a bad fit for our area.

Most, if not all, of those who desired to progress with the exclusivity agreement did not particularly want to see an LNG plant on our bay. They wanted a future in Humboldt. They wanted very reasonable things like a more useful deep-water port, higher employment rates, consulting and engineering contracts, and future consideration from outside investors. Calpine was their pot of gold.

The problem is that we need to stop chasing rainbows.

We need to stop looking outside of our community for our future. We cannot wait for some outsider whose intent is to profit off of us to solve our problems.

While these interests may help us survive, they will not solve our problems and we may be waiting forever. What we need is to define and build our economy from the within. We need an internal movement to unite economic, social and environmental goals.

Once we have reached a common ground we can then lay a path to our future. Easier said than done? Yes, but we must start now. The term "division" has been tossed around our community so long it is cliché. Let us make it antiquated.

(In the next column, Whitcomb will discuss ways to build our economy from within. Jason Whitcomb is a fifth-generation Humboldt County resident and is a small-business owner.)

¹ "The Humboldt County Economy: Where Have We Been and Where Are We Going?" Steven C. Hackett, Humboldt State University, February 1999, www.humboldt.edu/~economic/humcoecon.html.

² INDEX OF ECONOMIC ACTIVITY FOR HUMBOLDT COUNTY, Professor Steven Hackett, executive director, John Manning, managing director

³ Employment Development Department, March 12, 2004, News Release No.: 04-07, www.edd.ca.gov/urate200403.htm.

ª A Living Wage in Humboldt County: A comparative study of three models* Deborah Keeth, Assistant Director, Index of Economic Activity for Humboldt County, September 1999 www.humboldt.edu/~economic/LivingWage.htm.