Residents of Frederick County are, in many ways, facing the same economic issues that have permeated the rest of the country. Whether or not the economic stimulus payments to individuals and business tax breaks will have a significant effect on residents of Frederick County or anyone in the country is debatable. But to be fair, the payments will most likely be used in the same way that tax refunds have been used annually: To pay off debt or purchase items that were on the “want to have” list. According to Chris Olson of the Small Business Development Center, Frederick County, like many of the areas surrounding Washington, D.C., has been somewhat “recession resistant” and able to rebound quicker than most areas due to our close proximity to the federal government. He notes, however, that not all sectors will rebound at the same rate. For example, increased food and energy costs will continue to challenge the restaurant industry for quite some time. Frederick County has been fortunate to see strong growth in both the public and private sector, attracting high numbers of technology and biotechnology companies to our area. Fort Detrick, the Frederick Innovative Technology Center and very active economic developers have contributed to attracting both new businesses as well as nurturing and growing existing businesses in Frederick County. Like the rest of the country, Frederick County has seen the emergence of numerous community banks that have a strong focus on small businesses. From a lending and money perspective this is a very positive situation. Chris notes that “For what it’s worth, we’ve seen no drop-off in the number of people interested in starting their own businesses and no significant increase in the percentage who want to start a business because they’ve lost their jobs.” Ultimately, Frederick County residents are likely in a stronger position than those in many other parts of the country due to numerous factors well beyond the economic stimulus package.

The economic stimulus plan will have an effect on the national and local economy. The big question is how much and how soon? The major assumption in figuring how many jobs will be created revolves around what individuals do with their check when they get it. The government is assuming that everyone will run out and spend it thus creating economic growth and the new jobs. There are many like myself that believe that many will simply pay down debt they have from increased gas and food prices and not make many additional purchases and thus have little effect on the local economy. Certainly in the long run it will mean they have a little less debt and at some point that will translate in to additional spending but I believe that will be years from now and not today. The overall economy is showing signs of recovery and that is good for the national and local economies. In my opinion there are several things hurting us locally, including a soft real estate market and high gas prices. Since so many people in Frederick commute to their jobs, their discretionary spending has been drastically diminished. In addition, the value of their largest asset, their home, has also decreased in value significantly. This leads to not only lower spending but lower consumer confidence. These together really hurt the economy. The lending markets do seem to be getting better but it is still tougher to get a loan today than it has been in the past. I would argue again that this will be better in the long run as those that get loans should be able to repay them.

Because what’s good for the country is even better for Frederick County. The counties that surround Washington experience a certain type of insulation from the real hardships that affect much of our country during an economic slowdown. Just ask someone in Michigan how things are going to get a proper prospective. The stimulus payments and tax breaks will work, but mostly in a psychological way. The net jobs added for the rest of the year will depend on the amount of further reductions of jobs in the housing and financial sectors. Having said that, I hope Secretary Paulson is correct on the +500,000 number. In summary, Frederick County residents will be better off now, 50 years from now, and every year in between by making thoughtful and prudent decisions when it comes to their finances and business interests. Every older person I’ve spoken with about the foreclosure and credit crisis has shaken their head or expressed some other form of frustration at how people could make such poor decisions and have painted themselves into the corner. But whether it’s the current issues or those of the past (junk bonds in the 80’s, commercial real estate bust in the early 90’s, tech bubble bursting in 2001, etc.), the most important thing is to learn from it and make sure that we exit the crisis better and stronger than before.