SC ECONOMY IN SHAMBLES, WORSE THAN REST OF NATION

A prominent University of South Carolina economist said the state’s financial problems are about to get much worse Wednesday, the same day new employment numbers showed South Carolina lost more than 1,000 manufacturing jobs in the past month.

University economist Doug Woodward said South Carolina already ranks with states like California and New Jersey for having the nation’s worst budget problems. While the national recession began in December 2007, South Carolina’s woes started much later.

“We believe South Carolina actually entered the recession closer to July or August,” Woodward told reporters at the university’s annual Economic Outlook Conference.

“We believe South Carolina actually entered the recession closer to July or August,” Woodward told reporters at the university’s annual Economic Outlook Conference.

Since July alone, state economic forecasters have cut more than $700 million from revenue forecasts for the state’s $7 billion budget. That’s prompted the legislators in October to slice $488 million from agency budgets, with the toll heaviest on college and health care spending. The state’s budget oversight board may cut 4 percent more state spending next week and legislators are asking agencies to lay out plans for dealing with cuts of 15 percent for the budget year that begins July 1.

Woodward puts much of the problem thus far on property and sales tax breaks.

“Those two things really had an impact on the state’s budget this year, probably to the tune of $300 million,” Woodward said. For instance, while retail sales were increasing by about 3 percent, the sales subject to retail sales taxes were down as consumers shifted spending to buying groceries, which are no longer taxed.

“It was more of a tax problem up to this point – tax reform, tax restructuring – than an economic problem. The economic problems are about to hit us, so we’re going to get a double whammy,” Woodward said. [AP]

As if the doom and gloom forecast weren’t bad enough, a jobs report released today said the economic crumble claimed more than 1,000 manufacturing positions in South Carolina. Of that total, 570 lost jobs were in the town of Whitmire, where he town’s only major plant, belonging sock maker Renfro Corp., announced it would be closing at the end of January.

Company officials told the workers Tuesday afternoon. Word then spread quickly through the town of just over 1,500 people, said Michael Dillard, who owns Joe’s Market, the small grocery store his father opened 54 years ago on the main highway through town.

“It’s pretty much our only industry. Only place you can really work outside of a small business,” Dillard said Wednesday. “Everybody was a little shocked, but I think they expected it, too. I think it’s a lot different time than it used to be. Textiles, in general, they are pretty much gone.” [AP]

So what now? Well, state legislators will continue to tax and spend and tax and spend while our national leaders run around from television station to television station thumping their chests about how their doing a great job protecting taxpayers.

Meanwhile, we’ll continue to lose money and, for the unfortunate among us, our means to make that money. But on the plus side, you’ll have a good excuse for spending less on people for Christmas.