the town dandy / By Hank Sims

Crash and Burn

(Oct. 16, 2008)  The Evergreen Pulp Mill announced last week that it would be shutting down indefinitely, at least until the world market for paper and pulp picked itself back up, and you’d better believe that there were plenty of people around here who took the news like a stiff punch to the gut.

Start, of course, with the mill’s employees — over 200 of them, most of them union members accustomed to union wages, made jobless at a time when there are few jobs to be had. You can fan out any number of ways from there. Take the port-and-rail people, who are suddenly deprived of any excuse to maintain Humboldt Bay as a deep water port of call. Take customers of the Humboldt Bay Municipal Water District, which, as Heidi Walters writes elsewhere in this issue, are suddenly faced with the eventual prospect of tripled rates.

Or take anyone who has been paying attention to the worldwide economic meltdown, and received the news of the pulp mill’s closure as a sign that the crisis is coming home. Now. In a big, scary way.

At just about the time that Evergreen made its announcement, Prof. Erik Eschker and his crew, who run the Humboldt Economic Index, were preparing to release the latest edition of that monthly publication. The news from the index was grim indeed: The Humboldt County seasonally-adjusted unemployment rate reached 8.3 percent, the highest it has been in over 10 years. The median price of a home continued to drop, and more and more people were defaulting on their mortgages. More people had done so, in fact, than at any time since Jimmy Carter was president and maybe before.

And these statistics were from the month before the pulp mill announcement. What is the index going to be like during the rest of 2008?

“There are tens of thousands of people who work in Humboldt County over the course of any month,” said Eschker last week, downplaying, somewhat, the significance of the mill going down. But not completely: “Two hundred from one location is a pretty big thing,” he conceded, “and more importantly, it may be an indication of what’s to come.” If so, what’s to come is not at all pretty.

For one, the wood products sector is definitively no longer the economic engine we have been used to. It’s still big, but it’s just another of the many niche sectors that make up the economy. Take small pinches of lumber, dairy, fishing, services, tourism, light manufacturing. Slop them all in a bag, season with an equal amount of herbs and spices, and hire a university employee to shake vigorously — like it or not, that is Humboldt County.

The good part: A diverse economy at least means we are less susceptible to sudden, drastic shifts in any single company or industry. The old ones have already failed, or been drastically reorganized à la Pacific Lumber/Humboldt Redwood Company. The bad part: There’s no easy, obvious source of growth, no spigot that we can simply turn up in times of need. Even marijuana is suffering from problems of oversupply, much like the pulp and paper industry.

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