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Sept. 26, 2018
This paid piece is sponsored by SDN Communications.
By Vernon Brown
Often, economists get a bad rap as presenters, but “Bowtie Economist” Elliot Eisenberg’s humorous, blunt outlook exceeded expectations at a recent presentation in Brookings for rural telephone companies.
Eisenberg not only speaks nationally but also publishes articles, testifies before Congress and worked as the senior economist for the National Association of Home Builders. During the South Dakota Telecommunications Association’s annual meeting, he peeked into the national economic crystal ball and our local economy, delivering good news and some cautionary notes for the not-too-distant future. Of course, he did it all wearing his trademark bow tie and shouting quips.
“We’re getting drunk. It feels good, but it’s not the way to make a living,” he said.
Recent tax cuts and increased government spending fuel the economic party.
“This is as good as it gets,” he said. “Enjoy it.”
Conversely, Eisenberg warns the biggest concern should be the very same tax cuts and increased government spending.
He predicts inflation trouble in 2020. Contributing to the pain: the U.S. is the only powerhouse country increasing its deficit at a concerning rate. Adding to his concern: History indicates we’re due, maybe overdue, for a recession.
President Donald Trump’s tariffs have certainly made news in farm country, and Eisenberg fears they also will hurt national employment and the Gross Domestic Product.
“They (tariffs) will boost employment in aluminum and steel, and reduce it everywhere else,” he said. “It’s my No. 1 fear right now.”
Eisenberg is equally blunt about economic prospects for South Dakota.
“Your population growth basically sucks!” he exclaimed.
Not surprising to anyone, but sometimes it takes an outsider, like a D.C. economist, to punctuate it. It was an exclamation point felt in the audience made up largely of rural residents.
“You have too many populations declining in counties, too many shrinking towns, a hollowing out of the state,” he said. “You have problems with workers. You need to steal, kidnap, go to Puerto Rico and lie about your weather to get workers!” Eisenberg joked.
He offered one piece of encouraging news for the future: A congratulations to the SDTA companies for the broadband investments they’ve made across the state.
“Broadband is essential for any community hoping to grow,” he said.
SDTA’s member companies serve more than 65 percent of their rural customers with fiber to their homes or businesses. In contrast, a national survey in 2016 found rural companies across the country serve just 40 percent of their customers via fiber to the premises. In addition, more than 76 percent of SDTA’s customers have access to internet download speeds of 25 megabits per second and upload speeds of 3 megabits per second, which the Federal Communications Commission deems high-speed broadband.
The economist offered encouraging news for the state’s two cities bookending the state: Rapid City and Sioux Falls.
Take a look at the progress SDTA members have made to provide broadband connectivity between those major cities and across the state. Download a free copy of the South Dakota Broadband Report using the button below.
“We’re getting drunk. It feels good, but it’s not the way to make a living.” Why this economist warns we shouldn’t get too complacent in business, with some risks on the horizon.