Calling the recent “fiscal cliff” negotiations in Washington a lost opportunity, Bank of Idaho President and Chief Executive Officer Park Price says if Congress and the White House can successfully resolve the looming debt ceiling and sequestration budget controversies, he expects robust economic growth in Idaho and the United States during 2013.
If agreement is not reached, America will teeter and lurch back into recession, he anticipates, noting the federal sector accounts for 20 percent of the economy.
Noting that six million jobs have been lost since the nation’s economic meltdown of 2008, Price says he hopes 2013 will see business start to hire more people, which is a must for the nation to pull out of its worst downturn since the Great Depression.
But uncertainty over whether the U.S. will default on its national debt or whether massive automatic federal budget cuts will be imposed by sequestration on March 1 has companies reluctant to resume hiring. When they are forced to lay off quickly, they tend to hire slowly, says Price, who earned an economics degree from Dartmouth College in New Hampshire.
“Businesses hate uncertainty,” Price says. “The longer this goes on, the harder it is on the economy.”
For 13 years, Price specialized in capital investments for General Motors. From 1979 to 2003, he owned and operated Park Price Motor Co. in Pocatello, which was founded by his father in 1947. In July 2003, Price became president of the Bank of Idaho, which has seven branches in eastern Idaho and real estate offices specializing in mortgage originations in Twin Falls, Pocatello and Idaho Falls. He became the bank’s CEO in 2010.
The recent disappointing fiscal cliff debate resulted in some tax increases with no spending cuts. A more comprehensive package was needed on a grander scale, Price says, adding that deficit spending cannot be sustained at its torrid pace.
“It’s clear that the path we’re on is unsustainable. We continue to mortgage the future of our children and grandchildren. It is morally unacceptable to tolerate this,” the former Pocatellan says.
On the other hand, if spending is cut too aggressively, it could be a shock to the economy, tax revenues could fall and the federal deficit worsen, he cautions, urging that cuts be done gradually, not drastically. Congress won’t agree to raise the federal debt ceiling as President Obama wants without significant spending cuts, he observes.
Because of the fiscal cliff outcome, taxes are now off the table, Price notes, stressing he hopes cooler heads prevail as the new Congress gets organized. “Unfortunately, we don’t have much time,” he says. (more…)