A few days ago I commented in these spaces that the problem wasn’t the economy, it was the uncertainty. I will add to that by describing a conversation I had yesterday with the GM of a major parking supplier.
“There are tons of pent up demand,” he told me. “There are systems out there that have reached the end of their useful lives, but people are trying to get another couple of years out of them rather than replace. They just aren’t sure what to do and are waiting before they pull the trigger on a purchase.”
Damn, its that uncertainly again.
Another Chairman of the Board told me a few hours later than banks are awash in money. “They just are afraid to lend any at a reasonable rate. They have no clue what is going to happen. Will they be taxed, taken over? They are already being regulated to death.”
If you think what is going on in Washington doesn’t affect you, think again. These were the leaders of the two largest companies in their sectors of parking suppliers. They know what they are talking about. They know that the business is there. They know that people want their products. They also know that by not buying, consumers are putting off purchases at their peril — They are spending huge amounts on maintenance and replacement parts, just to patch things together to last a few more months.
And these issues affect each of us. Consider this: You are a manager of parking for a medium size city. The city council has told you to raise the rates on street, but you know the existing meters won’t take the strain. You need equipment that takes banknotes and credit cards. The city council has also told you that you may not have any capital expenditures for the foreseeable future. You will have to “make do.” You staff is grumpy, since they will have to try to cobble a solution together. The public is irate (can you say Chicago) because rates were raised but you have no way to realistically collect the money. The problem goes directly back to high unemployment and the fact that too few people are paying taxes and buying homes and a depressed housing market. The tax base is crap.
This scenario is being played out daily throughout the country.
Next time you see your representative tell him or her to get out of the way and let our economy grow. I heard today that we should be growing at 9%. However our government has regulated business to the point that no one wants to commit.
Its not the economy, stupid, its the uncertainty.