The analysis of Falls Church’s chief financial officer Richard LaCondre reported in last week’s edition – namely, that population growth is the key to the City’s economic development success in the future – was a derivative from other comments by LaCondre, but was a direct statement from him at the same briefing that was being reported on.
LaCondre used a form of Socratic dialogue to eliminate all other options before making his statement as a declaratory fact. And we agree with him, even if all the implications of his perspective require further consideration.
What citizens of the tiny City of Falls Church, or larger surrounding jurisdictions, for that matter, most often fail to take into consideration in wrestling with their own budget issues is the prognosis for the economic health of the wider region.
In the case of Northern Virginia, for the first time in decades, the outlook is not as rosy as some might wish it to be. The sustained impact of federal government sequestration is the single most evident culprit for this, but not the only one.
In terms of the uniqueness of the regional economy, to the extent that government spending – the letting of federal contracts in particular – has been the driver, nobody should be surprised that backing away from this big time through sequestration and other federal moves is going to have a ripple effect that could last a decade or more.
The most significant marker in this case is the current glut of commercial office space throughout the region. How short sighted does a Falls Church policy maker have to be to ignore this reality, and to continue to insist on a greater balance between residential and commercial in large-scale mixed use proposals? The City already lost one major project, the Akridge plan for N. Washington St., to its unreasonable demand for more “balance” in this fashion, and came within a hair’s breadth of losing a second.
In terms of the impact of the national and global economies on this region, there remains no evidence that a robust recovery from the Great Recesssion of 2008 (six years ago) has yet to occur or yet to show signs of occurring. All we’re seeing is one of the greatest federal subsidy programs in the nation’s history – the Federal Reserve policy of keeping interest rates at record lows for a half-dozen years – propping up an otherwise limping economy, still far from being able to stand on its own two feet.
People know this. But it never seems to get the attention it should when pundits come on TV to talk about car sales and other peripheral facets of the core economy. We are in what many are calling a permanent “new normal” in which levels of economic activity characteristic of the pre-2008 period may never come back.
LaCondre’s insights make a lot more sense viewed with these factors in mind.