Off the Kuff Rotating Header Image

The economic hardship of the freeze

We may have power and water again (mostly), but some things that were lost can’t easily be gotten back.

Last Tuesday, as Houston temperatures hovered below freezing for much of the day, Gloria Sanchez’s lights — and heat — cut off and on. For Sanchez and millions of other Texans, necessities usually taken for granted — including warmth, water and access to food — had suddenly been thrown into question. Then she got a call from her manager at one of the two jobs she works to make ends meet. Bath & Bodyworks would close because of unsafe driving conditions.

With that, 32 hours of wages disappeared.

“It broke my heart,” Sanchez said. “Because I knew my check was going to come out short.”

The winter storm will likely cost the country $50 billion in damage and economic loss, according to an estimate from forecasting company Accuweather. Much of the economic impact will be felt by hourly workers like Sanchez, economists said.

“You need to think about what’s permanently gone and what has just been delayed,” said Patrick Jankowski, an economist at the Greater Houston Partnership, a business-financed economic development group.

Oil and gas production can ramp back up to meet demand. Sanchez’s 32 hours without pay are gone forever.

[…]

“It’s a kick while you’re down to all of the service industries, restaurants and others who were already battling through the pandemic,” said Peter Rodriguez, an economist and dean of Rice’s Jones Graduate School of Business. “So regrettably, it really exacerbates the pain for them, more than it creates new pains for other industries in particular.”

Last week had to have been especially tough for restaurants and retail, which have been dealing with the pandemic for a year already. Support your favorite neighborhood places, they could really use it right now. The one bit of good news for workers is that the federal COVID relief bill, which will include the additional $1,400 payments to many people, is on track to be passed soon. It may still take some time for the funds to actually get out to the recipients, though. It’s just going to be rough for a lot of folks this month.

The longer-term picture has some warning signs, too.

As for long term impacts, Rice’s Rodriguez fears employers may think twice about relocating their businesses, both to Texas generally and to Houston — no stranger to natural disasters — in particular. He said the prolonged outages could make it look like the state has unreliable infrastructure.

“It’s true that this is very rare, but that’s not the way it will play into the memories of people making investment decisions,” Rodriguez said. “They’ll wonder about just our overall ability to manage crises.”

We really need to get our act together. No one who hasn’t guzzled the Kool-Aid is still talking about Texas exceptionalism with a straight face.

Related Posts:

One Comment

  1. Stephen says:

    Funnily enough I had to explain to WaPo Facebook fans that yes, Texas exceptionalism exists. I thought that was obvious.