SAN DIEGO, CA. Is there any hope amid the constant barrage of bad economic news? Yes there is, said David L. Littmann, economic consultant and senior economist at the Mackinac Center for Public Policy, addressing the Automated Imaging Association’s annual business meeting held here this week. The turnaround is here, said the self-described non-politically-correct economist, who cautioned that in his opinion the “Marxist, socialist” proclivities of the Obama administration could still be a hindrance. His comments came Thursday, just before the Wall Street Journal summed up the particularly bad employment news from last month: “U.S. companies slashed nearly 600,000 jobs in January -- somber news that appeared to dim chances for a recovery this year and helped spur the Senate to strike a deal on a compromise $780 billion economic-stimulus package.” Nevertheless, said Littman, “There is good economic news, but don’t count on the media or politicians to bring it to you, though.” As for the job picture, he said, unemployment and bankruptcy are lagging indicators that suggest the down economy is turning around. He said the nation has “been through situations that looked pretty bleak. Seven years ago, after 9/11, things come to standstill,” until General Motors instituted 0% financing, airlines offered special fares, and resorts cut the costs of lodging, food, and entertainment. That’s the way markets work, he said, as long as government doesn’t interfere. He noted that the US was the first country to suffer in the current meltdown and said the US will come back first. He seemed to favor some sort of bailout—an injection of funds to reliquify credit markets and the removal of bad assets from balance sheets, as occurred with the formation of the Resolution Trust Corporation in the ‘80s and ‘90s. But he said those funds should be promptly withdrawn to prevent inflation. He said that many industries are recession-resistant or countercyclical. Doing well, he said, are apartment managers, credit councilors, turnaround consultants, food-processing operations, educational institutions (enrollment, he said, rises when employment goes down), geriatric hospitals, and low-end retailers. To be among the recession-proof, he said, automated imaging firms need to unify their technological and management talent. From his 50 years of studying the Detroit auto industry, he said, he concluded that Michigan got careless and complacent, lacking the backbone to stand up to forces against the automakers: militant unions and government regulation. Four years ago government employment in Michigan overtook manufacturing employment. Although government used to create at least something, he said, such as the interstate highway system, it now has become a redistributative agent that doesn’t create anything. He said that AIA members could learn from Michigan’s mistakes. As of today we must confront reality that pres legis courts all in the hands of single minded party. Too many politicians are not friends of the competitive market system,” favoring higher taxes, greater deficit spending, more regulation, and trade protectionism. Trade protectionism, he said, is devastating, adding, “A nation doesn’t go to war on its customers.” Human capital goes to where it feels welcome and secure. Seek overseas markets where governments more welcoming. “Reduce your profile and here make yourself a smaller target.” He provided a seven-point plan for nations to institute a friendlier business climate: • Phase out corporate income tax. • Reduce onerous environmental regulations. • Lift restrictions on energy from clean coal to nuclear. • Respect property rights. • Rely on the supply-and-demand system, not government policy, to determine prices. • Ensure that capital and profits are fungible and able to be repatriated. As for the future, he said, “I’m a dissident in the profession,” and he forecasted a turnaround over the next four to six months, followed by slow growth in 2009, 2010, and 2011. Countering forces, he said, would be any restrictions on free trade and the Fed’s failure to confront inflation when growth returns. ******* Nelson, Rick ( February 7, 2009).  AIA hears turnaround prediction.  Test & Measurement World. Retrieved on February 10, 2009 from  http://www.tmworld.com/blog/640000064/post/1760040376.html