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WA chief economist Raha to quit

Arun Raha reads from a list of his Top 10 “Arun-isms”.

OLYMPIA — Dr. Arun Raha, the state's chief economist who delivered some the worst financial news in more than a half-century but managed a quip or a laugh to help ease the pain, is stepping down.

“I'm going back to the private sector, and anonymity, hopefully,” he said today at a press conference. He's taking a job as director of corporate economics for a company in Ohio.

Raha was appointed to the state Economic and Revenue Forecast Council in 2008, and his tenure has been marked by the worst economic downturn in the state since the Great Depression.

“It was a challenge,” he said. “Any job I have after this is going to be a piece of cake.”

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WA economic forecast today

OLYMPIA — The state's economic forecast for the remainder of this two-year budget cycle comes out this morning, and the real question here is not “Will it be bad?” but “How bad will it be?”

In June, the forecast all but wiped out the budgetary cushion, aka the ending fund balance, the Legislature thought it left at the end of its special session. Since that time, most economic news has been worse, not better.

Chief Economic Forecaster Arun Raha is scheduled to begin his presentation at 10 a.m. to the forecasting council. He typically gives a midline forecast, as well as a pessimistic and optimistic estimate.

A major drop in expected revenues early in the biennium — that is, in the next six months — could prompt calls from some legislators for another special session to trim the budget. Gov. Chris Gregoire has already ordered state agency leaders to come up with plans to cut 5 percent and 10 percent from the spending plans they were given by the Legislature in June.

We'll have updates for you later in the morning.

State economist: Risk of recession increasing

OLYMPIA — Washington's economic outlook for the current budget cycle has gone from cautiously optimistic to “a sinking feeling of pessimism,” the state's chief economist said Thursday.

“The risk of the economy slipping back into recession has increased significantly,” Arun Raha said in the latest economic and revenue update.

In June, Raha was confident that Washington and the rest of the United States would avoid a “double dip recession” and that growth would continue, although slowly.

Since then, debt problems have spread beyond in Europe, the U.S. government barely avoided a default on U.S. bonds but couldn't escape a downgrading by a major rating agency, and consumer confidence “is in the tank.”

State job growth hasn't been as strong as projected, the single-family housing construction sector remains flat, banks and local governments have been laying off workers and about the only manufacturing sector growing is aerospace.

Oh, and by the way, state revenue collections are down about $9 million below forecast since June.

The next full revenue forecast is due in mid September. A significant drop in projected revenues could lead to a call by some legislators for a special session to make deeper cuts, sooner.
State agencies already were ordered to identify ways they could cut their budget by as much as 10 percent.

Revenue outlook a little worse; Budget reserve outlook even more so

OLYMPIA – The state’s most likely revenue outlook for the next two years dropped slightly Wednesday as the state’s chief economist revised his projections down about $183 million because of what he calls a “soft patch” in the recovery.

The state should collect $31.603 billion in its general fund to spend on a wide array of programs, services and salaries, Arun Raha said, or about sixth-tenths of 1 percent less than the revenue projected in March…

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Economy improving, state budget in black from tax hikes

OLYMPIA — Although the economic recovery “lost steam” in May, the state’s economic outlook is slowly improving and the state’s budget no longer awash in red ink.

What’s keeping it in the black, however, are hundreds of millions in new taxes the state expects to collect through mid 2013, and an as-yet unfulfilled promise of $480 million in federal money.

Arun Raha, the state’s chief economist, said this morning the state’s job growth was “disappointing” in May, after several good months of increases when manufacturing and software jobs improved. In May, most of the job growth was from temporary employment for people helping with the U.S. Census.

Some employers are holding off on new hires…

State budget outlook: Getting less awful, slowly?

OLYMPIA – Good news for the state is the recession is pretty much over. Bad news is won’t seem like the recession is over until the middle of the next year.

That was the assessment Thursday Arun Raha, the state’s chief economist, gave the Senate Ways and Means Committee.

            The panel, as well as all other House and Senate committees, are gathering in Olympia this week to hear what’s happening with the bills they passed this year, and get a preview of what they’ll face next.

What they’ll face is a budget that’s more than $1.2 billion out of balance, even after eating up about $570 million the legislators thought they’d left last spring as an “ending fund balance.” That’s billion with a “b”, or as Ways and Means Chairwoman Margarita Prentice, D-Seattle, put it: “Pretty soon you’re talking real money, right?”

Senate Majority Leader Lisa Brown, D-Spokane, in a separate interview, said she’s warned her caucus to expect another tough session with the budget – tougher than last year, because there probably won’t be several billion from the federal government in stimulus money.