Fear Replaces Greed

Is it possible Bush and Gore are talking about the wrong thing?

Both presidential candidates are arguing over what to do with government surpluses. The National Debt Clock has even been taken down because it had taken to running backward.

But increasingly I see signs that things are going the other way. Consumer spending is slowing. Analysts talk of a “soft landing,” but that might just be a recession under another name. Consider the evidence.

Qwest announced it is laying off 11,000 people and Novell is laying off nearly 1,000. Here in Atlanta, iXL is shedding 350 jobs. Once their merger is complete, CNET and ZDNet are expected to shed more jobs – maybe even journalists’ jobs. (Now that hits close to home.) Webvan is cutting 50 jobs with its acquisition of HomeGrocer.com.

Those are just the cuts we know about. When a dot-com (or any small company) goes under, it doesn’t make a sound in the press, but it does make a big noise in hundreds of lives. We can laugh about APBNews or dozens of others, but those are real people on the street now.

Everyone assumes that these people will quickly find new work. But there’s a vicious cycle that makes downturns worse, the flip side to the virtuous cycle that has kept things rosy for so long. Oil prices rise, inflation rises, growth slows, unemployment grows, and government surpluses turn into deficits. Then foreign investors pull money out of the U.S., the trade deficit gets worse, there are more layoffs, there’s more inflation, there’s more unemployment, and we have more deficits.

None of this is certain, but these are the times that can try any businessperson’s soul. The instinct is to cut back, to retrench. I used to get a tchotchke in the mail every week. I got my first in months this week (it was a baseball celebrating a Lot21 party I can’t make in San Francisco). Freelance markets that were offering $1/word to me a few months ago are suddenly offering 25 cents, or – worse – not even returning my emails.

It’s old hat to me. It took me four months to get my first journalism job, even with a graduate degree, because the job market was horrible back in 1978. I’ve seen several slowdowns in the computer press, a couple of real recessions, and I’ve personally suffered several layoffs. Like generations of jaded old-timers before me, I wonder what “the kids” (by which I now mean 20-somethings) will react to their first taste of hard times. (All of us 40-somethings hope it’ll make them grow up.)

I enjoy covering business because of times like these. Now is when entrepreneurs really deserve admiration – when they can keep writing paychecks and finding new markets despite bad news. Today’s paycheck looks far nicer than yesterday’s report on stock options – it’s far more likely to be appreciated.

I personally hope I’m wrong. I hope I’m just being paranoid. I hope the good people on the ClickZ Forum will all write to say business is great and people are wonderful.

I hope it’s just Monday. It is just Monday, isn’t it?

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