This summer has not been business as usual in Tahoe.
In addition to being an editor and reporter at Moonshine Ink, I also own the Tahoe Art Haus & Cinema in Tahoe City. After 11 years in business, I am very familiar with the cyclical nature of the tourist seasons. As locals know, there is summer and there is ski season, and those two periods are when Tahoe businesses bring in most of their annual revenue.
But something has been askew this summer. Tahoe is not as busy as normal.
This really hit home for me in July, typically the busiest month of the year in Tahoe. Normally, once Fourth of July hits, Tahoe is at peak visitation through mid-August. But that’s not what I was seeing. At the theater, weekends were busy, but then numbers would drop off mid-week to almost off-season levels.
We have only had one sold-out show the entire summer, which is not normal, even by post-Covid standards. I normally staff four employees a day in July. This summer, I went down to three and even two employees. Our numbers are down by 15%.
So, I began conducting an informal survey of other business owners. The proprietors of a Tahoe City nail salon told me they were down by 40% and noticed the same thing about weekdays vs. weekends. The manager at the bank said most of its clients had told her that they were having a slow summer. A woman who is a buyer for a home goods store in Truckee told me that business is down so much that it’s giving them cause for concern. My daughter, who works at River Ranch on the patio, has reported abnormally slow days.
When one of my employees, who also works at a ski resort in winter, told me that the ski area is already reducing hours for his department for the upcoming season because they don’t expect this winter to be as busy, I knew something was afoot. And it made me scared.
For the July edition of Moonshine Ink, we asked financial writer John Manocchio to write about whether a recession was on the horizon. His answer was no. He cited high consumer spending on the national level and, at the local level, numbers from Visit Truckee-Tahoe, the North Tahoe Community Alliance, and TOT receipts that showed that tourism in our area remained strong.
But he was looking at numbers from earlier in the year. Not now. Not from this summer.
Do you remember the 2015 movie The Big Short about the 2008 financial crisis? Hedge fund manager Mark Baum, played by Steve Carell, embarks on a field trip to Florida, where he finds that mortgage brokers have been selling houses to people who didn’t qualify for loans. Baum becomes one of the first to discover the subprime mortgage crisis and impending housing bubble collapse.
I feel like Mark Baum — I am noticing a reality on the ground level that not everyone might see yet. I believe we are at the start of a recession. Las Vegas has seen tourism drop 7% compared to the first half of the year due to a decrease in international visitors as a result of Trump’s hostile immigration policy, also known as the “Trump slump.” I think Tahoe is experiencing a different kind of Trump slump; I blame our president’s nonsensical and on-again-off-again tariff policy for the slower summer in Tahoe.
Tariffs — which are not paid by the countries they are levied on, as Trump ignorantly claims, but are eventually passed on to the consumer — create a climate of uncertainty and instability, not to mention higher prices. Trump has imposed new tariffs or significant increases on 90 countries (that’s almost half of all countries), both friends and foes. (He even put tariffs on the uninhabited Heard and McDonald islands near Antarctica. Tell me how that makes sense.) Whether consumers are feeling the higher prices or are just bracing themselves for the possibility, I think people have reduced their spending. The New York Times has noticed the same. On Aug. 2 it published the story, After A Lag, Consumers Begin to Feel the Pinch of Tariffs.
The labor market is also slowing. When Trump didn’t like the weak job numbers in a report released this month, he fired the messenger — booting the Bureau of Labor Statistics commissioner and calling it fake news. Economists say those numbers could be the first indicator of a recession on the horizon.
Trump wants to create his own reality. That’s what dictators do. But it never ends well, neither for consumers, businesses, or countries.
We have a president who is destroying his own economy and Congressional Republicans – including our representative, Kevin Kiley — who have abdicated their power to stop him. Think of this when you go to the polls next November.
