Numbers tell bleak tale

There's no spinning good news from the state's latest report on taxable sales -- not with lawmakers angling to ramp up government spending amid plunging tax collections.

Statewide sales slipped 7.4 percent from March 2009 to March 2010, totaling $3.3 billion. In Clark County, taxable sales dove 9.4 percent to $2.5 billion.

The glass-half-full set will point out that March was the fourth straight month of single-digit percentage dips after 14 months of double-digit declines. They're also pleased to see a 26.6 percent increase in accommodations, a 15.6 percent boost in spending on clothing, a 10.7 percent rise in car sales and growth of 5.1 percent in restaurant and bar receipts. Finally, despite the overall drop, the sales numbers are still beating the projections of the Economic Forum, the nonpartisan panel that provides binding revenue forecasts used to set general fund spending.

What's not to like about those trends?

Well, March's taxable sales are down a whopping 26 percent from just three years ago -- in March 2007, Nevada businesses rang up $4.47 billion in taxable sales. Nevada's unemployment rate stands at a record 13.7 percent, and Tuesday's Review-Journal reported that Nevada has 147,000 fewer active registered voters than it did in November 2008.

Throw in the nation's leading foreclosure rate and the most troubling nuggets from March's taxable sales report -- a 57.6 percent drop in construction sales and a 56.9 percent decrease in sales of wholesale durable goods -- and one fact becomes inescapable: Nevada has fewer people than it did a few years ago. Some workers have shipped out, and thousands more have been out of work for a year or more.

Happy days will not be back anytime soon. And the kind of robust economic activity we saw just three years ago -- the kind that sent government revenues and public employee salaries soaring -- might not return for a long time.

The 2011 Legislature will try to raise taxes again to compensate for these collapses, a step that would reduce economic activity even further.

Only job creation can lift Nevada out of its doldrums and provide the kind of revenue lawmakers want to spend. Tax hikes don't spur job creation -- they kill it.