Hank Lewis - Economics Professor, Lone Star College Joins Houston's Morning News

Episode Transcript

Speaker 1 (00:00):
Well, let's see if Hank Lows has the sunglasses on
this morning. He's an economist at lone Star College. Hank,
how you been very well? Jimmy, how are you doing?
I'm terrific, Thank you. So we had the GDP come
out yesterday. It dropped point three percent, which of course
has the doomstairs going. Oh, here comes the recession. Do
you see that as the sign of an oncoming recession?

Speaker 2 (00:23):
Is a concern? Yes, sign up, an onstacoming recession. Not
this year, maybe, and then a year or so if
certain things continue, but not in the immediate future for
the Houston, Texas area.

Speaker 1 (00:33):
Okay, and that's what we really care about, right Houston.
One thing I'm noticing is the price of oil has
been going down quite a bit. That generally is not
good news for the Houston economy. Are you concerned about
that at all? A little bit?

Speaker 2 (00:48):
A little bit because we do have a heavily energy
based industry. Pardon me. The thing is it could be
good news for people that drive places because the price
of gasoline and petrochemicals will go down. But the question
is where's the refining taking place? We're finding taking place
on us soil that's not bad news for production, it's
just bad news for oil company profits. But given level

(01:09):
of profits oil company has been having for the last
couple of years here, they can stand to weather that's
at least in the short term.

Speaker 1 (01:14):
Yeah, and you know, the Texas economy is such an
important part of not just the American economy, but the
world's economy, isn't it. Aren't We like the eighth largest
economy in the world.

Speaker 2 (01:24):
We are the le large economy in the world, with
the fourth largest state economy in the United States. We're
slightly larger than Canada in fact as far as the
size of our economy, but our economy is a little
more narrowly defined than the Canadian economy is. We've got energy,
we've got medicine, we've got aerospace, we have agriculture, and
we have some minerals and so we have a lot
of those kind of things that help the economy be vibrant.

(01:46):
But at the same time, we do rely on a
certain amount of tourism, on a certain amount of international
business given the business of the Port of Houston.

Speaker 1 (01:53):
So it's a mixed bag. Yeah, and you know, sometimes
that works to our advantage. If things have got to
be expensive. For example, if if plane fares are super expensive,
if you know, we if hotels are super expensive, if
traveling to a foreign country is super expensive, then people
are people are going to get their vacation, and hopefully
they get their vacation in closer to home exactly.

Speaker 2 (02:14):
Texas has got a lot of great street parks. We've
got great beaches as well. We have theme parks to visit,
museums and so forth. So if a lot of Texas
stayed a little more local this summer and spent their
money here, that would not be bad for the economy.

Speaker 1 (02:25):
Okay, So why are you bullish on the Houston economy
for twenty twenty five? Tell me why?

Speaker 2 (02:30):
Well, for this year specifically, let me be through for
twenty twenty five. A lot of it has to do
with the fact that we've had some news corporations locating
headquarters not just into Houston, but into the Texas Triangle
as we call it. We also have, of course, our universities,
we have the medical Center, we have all the research
going on, and the aerospace industry, especially when you get
down into that zone on I forty five between clear

(02:51):
Lake and Galveston, that is just hopping if you've seen
what they've been doing with the spaceport they've built down
there over to Ellington Field. So we have a number
of different industries that are very active that have be
at least hopeful for this year.

Speaker 1 (03:03):
Okay, So let's say, for the sake of argument, that
a recession does come next year or the year after,
or it doesn't come. How tied in is the Texas
economy to a national recession. Are we one of those
economies that is more recession proof than other states?

Speaker 2 (03:20):
I wouldn't say recession proof. It's more that the business
cycle for Texas is somewhat out of sync with the
rest of the country, partly because of the energy industry,
but also partly because of our role in the international
economy as well. Texas exports a lot of agricultural goods.
Texas does export some oil and petrochemicals. The main factor
that I see as far as that could harm the

(03:41):
Texas economy is if we don't reach a resolution of
the trade ward. The President the administration needs to get
to the table, needs to get some negotiations and so forth.
Because some of our industries do rely on.

Speaker 1 (03:51):
Exports, Okay, we need some tariff deals. Thanks Hank, good
to talk to you. Lone star College economics Professor hanklu
is It six twenty six