The University YMCA discussed the recession and Illinois’ recovery from it at its Friday Forum on Nov. 6.

J. Fred Giertz, economics department head, spoke about the national economy, the Illinois economy and the state’s budget situation.

“I do think the economy has stabilized and will experience moderate growth over the next few years, which is very good news,” Giertz said. “But there’s still a lot of work to be done, especially in the state of Illinois.”

Giertz said Illinois’ problem is its lack of motivation to improve the economic situation, despite its capacity to deal with its financial problems.

Illinois has suffered from a serious financial situation for seven or eight years, Giertz said. He said Democrats propose extreme tax increases, while Republicans propose extreme cuts to fix the budget.

“We have a situation where neither side is giving a reasonable alternative,” he said. “We end up without anything being done. What we really need is a moderate tax increase, maybe a one percent tax increase, accompanied with some real discipline that will get the state back into a reasonable situation over a period time.”

Kasey Umland, graduate student and moderator of the forum, said taxes are one of Giertz’s areas of expertise.

“Professor Giertz’s major research interests are in the areas of public finance and regional economic development,” Umland said. “He specializes in state and local taxation and expenditure analysis.”

Giertz said he expects a relatively long and difficult recovery for Illinois.

“Illinois is slow growing in terms of population and employment,” Giertz said. “That’s not to say Illinois is a poor state. Illinois is still a high income state. We’re about four or five percent above the national average and in about the top 12 (of high income states).”

Giertz said Illinois still is not strong enough to withstand all of the economic problems. However, he said he thinks the U.S. is on the road to recovery.

“I think the economy is going to recover somewhat slowly, but I think we are headed in the right direction,” he said. “We had a big downturn. There are still a lot of structural problems and issues to be dealt with.”

What happened to the economy in 2007 and 2008 has been difficult because of both the recession and a coinciding financial crisis, Giertz said. However, he said stability has returned to the financial markets.

“You have to give some credit to the government,” Giertz said. “I think their interventions, in terms of trying to deal with the problems we had a year ago, were called for. It was not a neat, precise process, but it more or less got the job done.”

Despite the economy’s growth, Giertz said unemployment will still remain high.

“Today we have the highest unemployment numbers since 1983,” he said. “We expected that unemployment was going to remain high at or above ten percent for some time in the near future.”

Jane Leuthold, attendee and professor emeritus in economics, said the forum was insightful and balanced.

“I thought Professor Giertz covered both the national and state situation with depth,” Leuthold said. “I think he’s had a lot of experience with state financing. He’s very well informed about the tax structure in Illinois and what the possibilities are.”