BY FREDA MIKLIN
As the statewide stay-at-home order got extended to the current date of April 26, The Villager reached out to local leaders in the areas of banking and real estate, to get their views on the future of their industries.
From Buz Koelbel, President and CEO of residential real estate giant Koelbel and Company, developer of The Preserve at Greenwood Village and Crossings at High Line Canal, we heard, “At this point, I am not comfortable in offering any specific commentary until we get through at least April 30. It’s all going to depend upon when the country “gets back to work.” This one is so difficult to reconcile with ever-changing data, timing for mass testing, treatments and vaccines, etc. Any view of even the near term, much less the long term, is virtually impossible right now. One thing we know for sure is there will be some structural and psychological changes that will occur. Human nature is unpredictable, and as such, those are difficult to predict now as well.”
Koelbel is also a board member of the Common Sense Policy Roundtable (CSPR) (common
sensepolicyroundtable.org). He directed us to a podcast on the subject led by CSPR and AMG National Trust Bank Chairman of the Board Earl Wright. Wright opened his remarks by extending “thoughts and prayers for recovery and good health for those who are suffering this virus” and “our deepest gratitude to those health care givers on the front lines of this crisis.”
Wright continued, “As we face the worst part of this crisis, we always have an eye on the future, solutions, and innovations.” He discussed CSPR’s ongoing efforts to “model the data and understand the economic impact (of COVID-19) on our economy and the state budget.” Chris Brown, CSPR director of policy and research, joined Wright on the podcast. He said that state revenue projections for the next fiscal year, July 1, 2020 to June 30, 2021, include a decrease in revenue of $1 billion from what was expected prior to the novel coronavirus. Wright added that he expected a two to three percent decrease in nationwide Gross Domestic Product (GDP) for the current calendar year but that in the first half of 2021, “things will start to pick up, but it will be kind of tough for the consumer to get back into the economy and feel comfortable spending like they had before.” Wright focused on the potential job losses to Coloradans in the retail, arts, entertainment, and recreation, accommodations, and food services and drinking places that Brown highlighted in his March 24 study of the impact of COVID-19 on Colorado. That study projected the loss of 91,800 jobs if those industries lost half their business for 45 days and 183,000 jobs if they lost half their business for a full quarter. Brown pointed out that the higher number was the equivalent of the entire population of Fort Collins and Littleton. He also cited a study by a “national think tank” that estimated Colorado could lose 260,000 direct jobs by early summer. In response to a question from Wright, Brown said that the state, including local governments, expects to receive $2.2 billion directly from the CARES Act, in addition to money that is being sent to individuals and businesses.
Wright expects a return to a level of economic expansion will occur in late 2021 or early 2022 that “will result in…our coming close to where we were before this whole thing started …which is a pretty good economy, growing at around 2.0 to 2.2 or 2.5 percent… if the fiscal package works and if we can get everybody back to work.”
Jay Davidson, First American State Bank founder, CEO and chairman of the board, said on April 4, “Unless acted upon in a timely manner, the effect of so many unemployed workers and the demise of small and intermediate businesses, can have a catastrophic effect on the economy. By fiat, our government instantly slowed down the entire economy and may well have created a serious liquidity crisis. This crisis can have long lasting and negative repercussions.”
He continued, “I can’t speak for others, each person has to decide individually, but I have to wonder, would it have been wiser to educate, to ask citizens to exercise due caution rather than create panic, demand quarantine and with it, the cessation of economic activity? It’s a fair question and one the politicians will have to answer when this is over. We have survived other epidemics and even pandemics. The American citizen is resilient, hard-working and decent.”
Davidson continued, “Government’s answer to any problem, especially one they created, is to drop interest rates, print $2.2 trillion and redirect this funny money back to citizens and businesses. They use our money to temporarily placate us. This monetary policy solution has never worked to generate economic activity. Only citizens, consumers, and businesses grow the economy and they do so through free and independent transactions. The best solution is to open commerce as soon as possible. The economic crisis will increase exponentially as the quarantine and business slowdown goes on. The depth of the recession is dependent on time under quarantine.”
On April 11, he added these thoughts. “Perhaps most folks don’t believe, as do I, that our national reaction to the pandemic is irrational, or that it is based on panic and out of balance to the threat. Folks may disagree with me that any restrictions on individual freedom and liberty are illegal and unconstitutional. Yet we allowed our federal government, state governors and mayors to implement restrictions on our social fabric and on business. The repercussions will taint our world for decades. It is only through the will of the people that we may return to some semblance of freedom.
I submit that any action that separates us from our Constitution, from our nature as free citizens, to this extreme, even if we return to “normal” sometime soon, sets precedent for the future. Politicians and bureaucrats must hear, loudly and clearly, that their illegal actions are not acceptable under any conditions.”