EDITORIAL: Coronavirus economic carnage continues to pile up

Legislative Democrats patted themselves on the back after wrapping up the recent special session to close the coronavirus budget hole. But that’s like doling out fist-bumps to celebrate passing the 1-mile mark in a marathon.

On Tuesday, the state’s meal ticket took another gut punch when CES announced it was canceling its 2021 technology extravaganza in Las Vegas. The move, while not unexpected, only further signified that the economic destruction wrought by this pandemic will hamper Nevada for years to come. “It’s just not possible to safely convene tens of thousands of people in Las Vegas in January 2021,” said Gary Shapiro, president and CEO of the Consumer Technology Association.

The largest Strip convention, CES attracted 175,000 attendees in 2019 and generated an estimated $283 million for the local economy, according to figures from the Las Vegas Convention and Visitors Authority. Other shows will no doubt follow, leaving a full recovery for Strip resorts only a pipe dream until well into next year, at the earliest. That means state gaming and room tax revenue will continue to suffer, further dampening spending plans.

Further, there’s an increased likelihood that several groups will now more quickly transition to virtual platforms. “As the technology improves and convention and tradeshow attendance gets younger, meaning they’re very comfortable doing businesses remotely,” said John Restrepo of RCG Economics, “we expect the industry to fundamentally change. Anyone who thinks Las Vegas will return to a pre-COVID convention and trade industry is not being realistic.”

The damage goes far beyond the Strip resorts, bleeding into the hundreds of small business that cater to convention-goers and tourists. On the same day that CES walked away from its 2021 plans, local economic guru Jeremy Aguero told an audience at Las Vegas Perspective that a recovery could be as far away as three years.

For state lawmakers and Gov. Steve Sisolak, the task is clear. They’ll need to do more than meatball surgery next year to patch up the hemorrhage. Instead, they must rethink all sorts of assumptions about existing revenue sources, state and local splits, union contracts and economic diversification. The bad news sure to be delivered by the Economic Forum, which provides binding revenue projections for lawmakers, will only hasten the need for prudence.

In addition, the governor’s goal in managing the coronavirus at this point must be to allow as many taxpaying enterprises as is feasible to remain open in adherence with safety guidelines. No doubt many nervous consumers will stay home with or without government edicts, but reverting back to widespread shutdowns will only exacerbate the pain and suffering. It’s in the state’s best interest to facilitate a functioning economy during the pandemic to the greatest extent possible.