Lately, television, radio and print news outlets are riddled with the latest from Wall Street and Washington on the global economic crisis. But this leaves those of us on Main Street wondering what it all means locally. Two Ohio University professors weighed in earlier this week on the local impact of this crisis.

“The evidence, it seems to me, is that this community is better off than most parts of the United States,” Richard Vedder, emeritus professor of economics at OU, told The Athens NEWS Tuesday.

Vedder, who has a longstanding reputation as an influential conservative economist, said that since Athens has an economy that largely depends on the government for its livelihood and income, it has a more stable economic environment than most of the country. Athens has largely missed the rise in real-estate prices of the last 25 years, he said, as well as the subprime mortgage problem. (Local realtors, however, have confirmed off the record that the local real-estate market is slumping, with one of them admitting that local real-estate values have experienced a downward “correction.”)

“We are less impacted directly,” Vedder said. “Indirectly, however, we are a part of the national and international economy. If all of this continues and we have a national downturn and unemployment rises, there will be some effects on the community.”

Yusuf Kalyango, an assistant professor of journalism at OU, directs the university’s Institute for International Journalism. Kalyango said that part of the reason the local community may be confused about the economic situation is the way the media frame the issue.

“Unfortunately, this situation happened during the election campaign period,” Kalyango said. “The local media in Athens… They tend to frame it from what they draw from the national media.”

Kalyango said that since this economic crisis is occurring during the election season, it has become politicized.

“We focus on how the Democrats or the Republicans are interpreting the crisis on Wall Street, not economic experts,” Kalyango said. According to a recent study surveying 300 journalists reporting on the economic situation, he noted, 86 percent of them did not fully understand the situation.

“There is an uninformed media trying to inform the public,” Kalyango said.

Though this looks potential hard times for Athenians, Vedder said that even if the economy does go further south and continues to weaken, Athens’ public and private sectors probably would persevere. He explained that businesses in Athens are all small- or medium-sized, or involved in businesses where demand is unlikely to change, such as health services or even the bars on Court Street.

“I’d imagine that beer consumption will remain about the same,” Vedder said.

But the local economy is still not immune to the national problem, he warned.

“People in Athens, just like people anywhere, have investments,” Vedder said. The national crisis could affect people’s retirement plans or reduce the value of their pension-plan assets.

The question of what the government plans to do to get the economy back on track remains unclear. On Monday, Congress failed to pass an economic rescue package (aka bailout) worth $700 billion. The U.S. Senate was preparing to vote last night on another try, designed to convert some of the no votes from the Monday vote.

“As much as we might wish the situations were different, our country is not facing a choice between government action and the smooth functioning of a free market,” Bush said in a press conference earlier this week. “We’re facing a choice between action and the real prospect of economic hardship for millions of Americans. For the financial security of every American, Congress must act.”  

As an economist, Vedder said he is less certain than most of the optimal strategy for getting the U.S. out of this crisis. He said he did give a list of suggestions to U.S. Sen. George Voinovich, R-Ohio, to guide any government bailout plan that may be signed into law in the coming days. If a rescue plan is signed into law, he said, it should do five things: Restore stability of financial system at the lowest possible taxpayer cost, punish those responsible for the losses, address the root cost of the price collapse of residential real estate, do something quickly, and be transparent.

“This is a fear-driven crisis,” Vedder said. “Knowledge and openness are needed to restore confidence.”