TOPICS > Economy

Good Times Go On Holiday In Oregon Tourist Town

December 11, 2009 at 12:00 AM EDT
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As part of the Patchwork Nation series examining communities across the U.S., Ray Suarez travels to picturesque Lincoln City, Oregon, where the recession has sapped the local tourism industry.
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JIM LEHRER: Ray Suarez has been reporting this week on how the recession has affected different kinds of communities. Tonight, a town that depends on seasonal economic activity: Lincoln City, Oregon.

RAY SUAREZ: Seven miles of beaches surrounded by piney hills lure tourists to Lincoln City, a picturesque town on Oregon’s northern coast. And if fishing and surf aren’t your things, there’s a freshwater lake for sailing, a culinary academy designed for amateur chefs, and a foundry where visitors can learn to blow glass.

But behind the picture postcard scenes, there are workers who serve food in the restaurants, take bets in the casino, work the registers in the shops. And their livelihoods are dependent on whether tourists come during the high season.

For 30 years, Steve Lamb’s kite business rode out recessions, but nothing was ever this bad.

STEVE LAMB, owner, Catch the Wind Kite Shop: We had strong summer weeks about six weeks, when we would like to have 12.

RAY SUAREZ: So, what does that mean to your bottom line, to have a high season that’s half as long?

STEVE LAMB: Well, it means that you didn’t get well from the previous year. And so everybody’s kind of hanging on at this point.

RAY SUAREZ: In the good years, Lamb employed some 70 workers, with benefits, in nine retail stores, a wholesale business and a factory. He’s down to one store and two employees.

Lincoln City has a lot going for it. But any place that needs to go from 7,500 year-round residents to 30,000 in the high season to keep everybody working leaves itself vulnerable to the whims of things beyond its control: weather and the wider economy.

The little town must maintain all the necessities of a much bigger one, says Lori Hollingsworth, a massage therapist and mayor of Lincoln City.

LORI HOLLINGSWORTH, mayor, Lincoln City, Ore.: The biggest complication really is being able to build out the infrastructure for 30,000 in the summer, the water, the sewer, the — all the needs that people have, the transportation.

RAY SUAREZ: The money to maintain public services comes from building permits and motel taxes. And both are down.

Lincoln City is one of Patchwork Nation’s service worker centers. During the early part of this decade, when people had money to burn on vacation homes and getaway weekends, the place was thriving. But, when the national economy took a nosedive last year, people here felt the effects almost immediately.

Kip Ward owns a bed and breakfast.

KIP WARD, owner, Historic Anchor Inn: The speculators invaded this town like the Romans, you know? We knew…

RAY SUAREZ: Well, but tell me what were the manifestations of that?

KIP WARD: There’s no inventory left. And as — as some of us lived here for decades, you know, these mortgages are $400,000, $500,00, $300,000. Who’s going to pay those mortgages around here? No one here can pay those mortgages.

ROGER ROBERTSON, KBCH radio: Seventy-fifty-two on the central Oregon coast.

RAY SUAREZ: Roger Robertson hosts a local talk radio program. He also sells advertising on the station, giving him a front row seat for the boom years. For him, those years felt like the new normal.

ROGER ROBERTSON: Things were robust; things were building; things were growing; things were prospering; there was no reason to believe that it was going to be anything else but what we were experiencing. And, suddenly, the real world crept in and came back and woke us all up.

RAY SUAREZ: Lincoln City and communities like it were among the first hit by the great recession. Dante Chinni, director of the Patchwork Nation project, says they may be among the last to feel the recovery.

DANTE CHINNI, project director, Patchwork Nation: These places kind of feel the pain first, because the discretionary spending stops here first. I think they also get the benefit of any recovery later, because the discretionary spending is going to come later.

And I think that this last recession was so deep, even when things turn around, people are saving money like they haven’t before, and they just feel just more insecure as a whole. And that means this place feels that insecurity, you know, in very harsh terms.

RAY SUAREZ: Small-business owners like Kip Ward say, in this new economy, they are forced to sink or swim.

KIP WARD: The customer is definitely in the driver’s seat. We had rooms that we used to rent for $69, $79. And it’s $39 now. So, you know, the market is what it is. And you either have to adjust to it and go with it, or go broke.

RAY SUAREZ: Ward owns the Historic Anchor Inn, once a vagrant’s flophouse, now an eclectic bed & breakfast. It’s a cozy gathering spot for visitors and locals alike.

We sat down with a group of businesspeople who have all been hit by the economic downturn. Again and again, they returned to the shock of finding their little town buffeted by forces far away.

Rick Brissette had to file for bankruptcy to keep his antique dealership open.

RICK BRISSETTE, owner, Little Antique Mall, Inc.: While I was busy during better times, and not paying attention to what was going on, on the national scene, that there were people making decisions and investments in New York City or on the east coast, that when it failed for them was going to rip my world apart.

RAY SUAREZ: You didn’t have a sense of that before?

RICK BRISSETTE: I had no sense of that whatsoever. I didn’t — I had never even heard the word derivative before and didn’t understand the implications of that. I have a much better understanding. As a small-business owner, I’m a little bitter and a little angry that those individuals have been bailed out and their interests have been protected. And, yet, mine have not or my peers here.

RAY SUAREZ: Well, isn’t just a matter of time? Or it sounds like you don’t even really believe that?

RICK BRISSETTE: I don’t see a recovery in this economy as we knew it several years ago for years.

RAY SUAREZ: Barbara Jenkins-Gibson owns a Christmas specialty shop. She actually had a good year. She says people cling to tradition, even during hard times, and they can spend less than $10 and walk out of her store with a nice gift.

BARBARA JENKINS-GIBSON, owner, Christmas Cottage: It is an opportunity to take a real good look at ourselves, get better at what we do. When it’s really good on a constant basis, you don’t take the time, you don’t have the time, to really fine-tune a lot of your systems.

RAY SUAREZ: Holding on by a thread, Steve Lamb is optimistic a recovery will blow through Lincoln City, giving his products a lift, hopefully in time for next summer’s tourist season.

STEVE LAMB: I think that we’re going to weather this recession, our — myself and our community. People, after a winter of being boxed in, will just rush to the beach. It’s an explosion of people. And I think it’s the same way with a bad economy. When it suddenly starts getting back to normal, people are going to be so ready for that, that here they come.

RAY SUAREZ: What we found in Lincoln City is a strong sense of how vulnerable tourist towns really are. Whatever they do for themselves, when or whether things get better really depends on cars bringing tourists and their money.

JIM LEHRER: And Ray is here with us now.

Ray, did you come away from this reporting with an overriding point or story that fits from all of these five stories you did?

RAY SUAREZ: I came back more convinced than ever that America is a patchwork. And, while it’s significant, let’s say, that the unemployment rate is 10 percent nationwide, that doesn’t really tell you that much about what is going on, on the ground and how different communities have experienced this recession.

JIM LEHRER: Is there a relationship — is there — the relationship between the unemployment and the location the overriding thing, or is it the kind of place it is, or what? What is the distinguishing overriding factor?

RAY SUAREZ: How they make a living in good times and bad. The fact that Philadelphia is a highly diversified economy, even one that’s had some rough decades recently, it has allowed them to withstand the force of this recession in a better way than many other economies around the country.

The farmers of Sioux Center, Iowa, never would have bought three houses, one to live in and two to sell. Their conservatism, their attitudes towards money meant that there was no real estate bubble in places like Sioux Center, so, when the bubble burst, they weren’t going to be collateral damage, the way a place like Eagle, Colorado, could end up being, with many unsold houses standing and waiting for buyers, buyers who may move there someday and may have trouble borrowing the money to do so.

JIM LEHRER: One of your pieces, somebody said, “Well, we have got some problems,” but they didn’t appear to feel they had an option to pick up and go. Did you hear that from — in these various locations where people had hard times?

RAY SUAREZ: You know, it’s a cliche about Americans that they are ready to go all the time, that opportunity is waiting somewhere over the horizon.

But the people I spoke to during the week, whether it is the partners at Zingerman’s Deli in Ann Arbor, or the farmers in Iowa, or the storekeepers in Lincoln City, Oregon, they had a very strong connection to the place where they lived, where they had done business, where they had a sense of community.

So, there wasn’t this feeling oh, boy, if I could just kick off the dust of this town and go somewhere else. People are really rooted in the places where they live.

JIM LEHRER: Now, speaking of traveling, you are about to do some more. You are off to Copenhagen to the climate conference. You will be reporting from there next week.

What is going to be the focus of your reporting?

RAY SUAREZ: Well, they have a draft document now. And that’s created a tremendous upsurge in interest in the deliberations next week, when a lot of heads of state are going to be coming to Copenhagen to put the finishing touches on some sort of document that they want to end the conference with.

Originally, when we had planned to go, Barack Obama was going to be there this week, and not next week, when the other heads of nations were going to be there. Now he’s going the Friday of next week.

And the president’s presence there is creating some movement on the ground, some increased interest. It will be really interesting to see. Even though they have made a tremendous amount of progress where others thought it might not be possible, there is still sniping between the delegations, the poorest countries saying that the richer ones don’t care about them. The newly industrialized economies saying that the old industrial economies don’t understand their needs. A lot of work has to get done in the next week.

JIM LEHRER: OK. Well, we look forward to your reporting. Happy reporting. Happy traveling. Thank you, Ray.

RAY SUAREZ: Thanks, Jim.