The North Coast’s jittery economy is at further risk from the double barreled state budget cuts of almost $13 million that Sacramento is imposing on Humboldt State University.
Two consecutive cutbacks are compressed into just 24 months, putting a most untimely economic squeeze on our region. Given what economists call the “multiplier effect,” the North Coast is likely to suffer a broad decline of economic activity in the range of $30-50 million as a result of HSU’s nearly $13 million drawdown.
Worse, the local economy and job market will suffer even longer if California lawmakers resort to stopgap funding measures and accounting gimmicks. Putting off a full and final solution to the state budget crisis until next year or beyond is unwise. The threat of more budget cuts will linger indefinitely over HSU and the California State University system.
Prolonged fiscal instability for the Arcata campus spells protracted economic uncertainty for the North Coast. This jeopardizes Humboldt County’s nascent recovery, and dissolves the economic confidence indispensable to regaining economic health that endures.
It’s as if legislators, armed with a two-by-four, struck the North Coast from behind with mighty blows to the neck and back. The state required HSU to cut $2.8 million in the academic year just concluded. We are in the midst of slashing $10.1 million more for the approaching fall and spring semesters.
That comes to a total of $12.9 million in two years, or a whopping 16% of HSU’s annual budget. In my 30 years of experience in higher education, this is the worst reduction I have ever seen.
Put in human terms, between 40 and 50 lecturers will not be rehired this fall. Classes will be bigger, and fewer in number. The campus police force and maintenance staff will both shrink. Neither security nor services will be what they once were.
HSU is the area's largest employer. Humboldt County’s jobless rate, which has shown preliminary signs of improvement, will be impacted. When this institution is forced to trim employment opportunities, the North Coast’s rebounding retail sales stand to lose momentum again, especially in a recovery as soft as this one.
Compounding the threat, of course, is the weakness of the national economic recovery. The national deficit is rocketing towards $500 billion, a record. Federal revenues are slack because the recovery is anemic. That diminishes the likelihood that Sacramento will get a revenue windfall from Uncle Sam to tide the state over. California lawmakers can hardly count on a federal escape hatch from their own $38.2 billion deficit dilemma. The state’s budget crisis has been mounting for two years, and should be dealt with conclusively, and fast.
Bad as it is for Humboldt County, a $30-50 million falloff in local economic activity could be dwarfed by the long-term damage the regional economy will suffer if our young people are not adequately trained to compete effectively in the ferocious global contest for jobs that the 21st century has in store. The student who misses out on a college degree loses about $1 million in lifetime income. Education is, by definition, a long-term investment in the economy as well as the individual. Education cuts yield productivity cuts—false savings, not real savings.
Only fundamental change—an overhaul of California’s government machinery and tax structure—can launch the state off its self-destructive path. Political leaders, business executives, retailers, educators and voters—most of all, voters—must act in concert and compel Sacramento to respond.
To say the least, legislators have shown a lack of political courage in their failure to adopt a prudent budget that is anchored by a long-term plan for political and governmental restructuring. But they will only act responsibly if they hear our voices ring with collective wisdom and conviction. Education is our seed corn. Sow thin, and you’ll reap little.

The author is President of Humboldt State University.