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Remarks
at Governor’s Council of Economic Advisors
Quarterly Meeting
St. Petersburg, Florida
September 27, 2002
>Florida
has demonstrated significant resilience in adjusting successfully
to a number of external shocks over the past year. Among
important “made outside Florida” shocks are:
1. Recessionary conditions in the U.S.
that began in late 2000, and continued through the end
2001.
2. A slow and tepid U.S. economic recovery
due to the tragic events of 9-11, and continuing aftershocks
since then. Furthermore, corporate reporting problems
have hurt investor confidence as reflected in the equity
markets.
3. Declining economic activity in key Florida
trade markets such as Argentina, Venezuela, Brazil and
others have impacted previously strong export expansion.
>
In spite of a still adverse external economic environment
as we finish the third quarter of this year, Florida continues
to create payroll jobs and leads in this growth among the
ten most populous states. Job growth, while still below
pre U.S. recessionary peak, is led by expansion in knowledge-based
services such as business services, health-care and educational
services. Construction employment is also rising, fueled
by population growth and low interest rates. People from
other states and the world want to make their home in Florida.
>The
question is why has Florida demonstrated such resilience
in spite of an adverse external environment that continues
up to the present?
1. From my perspective, Florida’s
positive performance under adversity is due in great measure
to significant improvements in our business climate under
the leadership of Gov. Jeb Bush. Lower taxes, improvements
in inter-modal transportation linked to economic development,
enhanced workforce skills and improving educational outcomes
have shielded Floridians from the noticeable jobs and
income loses we have seen at the national level and in
key states.
Independent and non-partisan organizations
such as the Small Business Committee, the CATO Institute
and Cyber States have recently ranked Florida as one of
the best business climates in the Nation. Specifically
the independent and globally recognized CATO Institute
rated Gov. Bush performance as an “A” –
with only one other state governor receiving such recognition.
In essence, Florida is strongly in the lead among site
selectors for new corporate relocations and expansion
activities that create jobs and higher-than-average wages.
Florida’s economic stimulus package,
implemented a few months after the tragic 9-11 events
under the Governor’s leadership, has also served
Floridians well. As my colleagues at the CEA know, the
Governor convened us right after 9-11 – he listened
to us, took our best advice and forcefully crafted and
implemented with the Legislature key measures to cushion
the effects of 9-11. The positive results are now evident.
2. In conclusion, since the tragic events
of 9-11, our key tourism sector has started a slow recovery
and our knowledge-based services industries are expanding
at a moderate pace. Of course much still needs to be done.
This is why we are meeting again here today. Key issues
are:
a) What is the U.S./global economic outlook
for rest of 2002 and for 2003?
b) What are the implications of such
outlook for Florida?
c) What additional policies do we recommend
to the Governor in the year ahead – given slow
economic conditions in the rest of the U.S. and globally?
Dr. Tony Villamil
Chairman
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