Americans are fond of using the Chinese concept of “yin yang” as a metaphor to describe all kinds of things. In essence, yin and yang are opposite or seemingly contrary forces which are in fact interdependent and interconnected, according to the Wikipedia page devoted to the idea. Examples of these opposite yet related elements are male and female, dark and light, water and fire and so on.
Yin and yang also might be the best way to describe two developments in the national and state economies, both reported on Tuesday’s BDN Business page.
The first concerns the economic recovery and the role of the private and public sectors. Nationally, the economy added 200,000 jobs in December alone, the vast majority in the private sector. But public sector jobs over the course of 2011 were down 183,064 from the previous year. In Maine, economist Charles Colgan said that between September 2010 and November 2011, the state gained 8,100 private sector jobs while losing 2,700 government sector jobs.
Of course, it’s easy to understand what’s driving these contrary forces. The weak economy, with far fewer people working, has resulted in substantially reduced tax revenue for governments. While the federal government can carry a deficit, state, county and municipal governments cannot, so they shed jobs to maintain a balance.
And of course, those government workers are our family, friends and neighbors, and when they lose their paychecks, the local economy suffers and less tax revenue flows into government coffers and so on.
The second yin, yang element, also featured on the BDN Business page, relates to China, appropriately enough. Businessman and 2010 gubernatorial candidate Eliot Cutler predicted that by 2040, China’s economy will be three times as large as the U.S. economy. That does not bode well for the U.S. and Maine.
But as this country of 1.3 billion grows its middle class, Maine has a chance to sell products there. Mr. Cutler related how he hosted two prominent Chinese businessmen in Maine last year, “where they lobstered on Penobscot Bay, visited the blueberry barrens and ate at Crocker House at Hancock Point.”
The men were impressed with the clarity of the water in Frenchman Bay, Mr. Cutler said, which demonstrates how the state’s “brand” as a place of scenic and natural beauty could be parlayed into a marketing strategy for food and other products.
These contrary forces — growing private sector jobs, shrinking public sector jobs; declining U.S. economy, growing opportunity to sell to China — must be embraced as facts. We don’t have to like these trends, but at least we can understand them.