Will Colorado economy turn purple state red or blue?

PUEBLO, Colo. — In this working-class city where steel was the economic muscle of the past and where harnessing the wind offers promise for the future, Cris Gillispie has seen jobs come and go. He’s watched the ranks of unemployed grow and the anxiety index rise in the last few years, but he has some advice: Wait.

“If I were going to say anything to the American people, it’s be patient,” says the 40-year-old firefighter and union activist. “People thought the president could wave a magic wand and the economy would be all better. But we have to deal with reality and ... it’s going to take time to get us out of this hole.”

About a mile away, Rob Leverington says the problem is not the timetable, but the president’s policies. The health care bill, the auto bailout, the stimulus? All mistakes, he says. “When the government gets involved, it extends or prolongs the suffering,” the civil engineer declares. “We shouldn’t look for the government to take care of us. That’s what the Communists were doing.”

Colorado, a state split by the Continental Divide, is also emblematic of the national divide. It’s a battleground state where President Barack Obama and Mitt Romney are saturating the airwaves, parachuting in and dispatching surrogates to snag nine all-important electoral votes. The debate here over the government’s role in the economy mirrors the polarized attitudes across the country.

Colorado’s recovery reflects the nation, too. A “Swiss cheese economy,” one official dubs it. Some industries and cities are rebounding; others still struggle. In Pueblo, where the jobless rate tends to be higher than normal even during prosperity, unemployment has lingered around 10 percent or higher for the past year. Hard times are not new in this heavily Hispanic community. The steel decline of the `80s left the city reeling, but it rebounded with new industries; a fairly recent entry was a Danish wind turbine manufacturer. “People here are resilient,” says councilman Chris Nicoll.

But which economy will Colorado voters judge this fall: the improving one or the one lagging behind? The answer to that question will help determine whether this purple state turns blue or red in November — and whether the president gets an extended lease on the White House.

Wide economic base

Colorado is sometimes reduced to a postcard image of mountains, ski resorts and cattle ranches. It has tourism and agriculture, for sure. But it’s also home to vast energy resources (gas, oil and coal), aerospace, manufacturing and health care. And it has a large military and government presence, including Fort Carson, the Air Force Academy, the U.S. Northern Command, the National Center for Atmospheric Research, the National Renewable Energy Laboratory and more.

The state endured a far-reaching recession and a slow, uneven recovery. Tourism, for instance, posted a record visitor year in 2011, but there are fears the recent wildfires may scare folks away. Agricultural land values have remained stable in some places, doubled in others. Crop prices have soared, though a prolonged drought could be bruising. Construction has stopped hemorrhaging jobs, but it’s a long climb back. An oil and gas boom has brought new dollars and jobs to the northeast part of Colorado, but natural gas producers grapple with low prices on the Western Slope.

Colorado, according to a state economist, has recovered 82,500 of 151,600 jobs lost in the recession, or 54.5 percent — nearly half in the last year alone. That’s better than the national average of nearly 43 percent. The May unemployment rate of 8.1 percent nearly mirrors the national average (8.2 percent).

Whether these numbers bring hope or despair depends on your point of view.

“There are some people who think the president had no chance to solve it (the recession) because of the deep hole created by somebody else,” says Richard Wobbekind, associate dean at the Leeds School of Business at the University of Colorado-Boulder. “Others say in the last 3½ years he hasn’t fulfilled his promise, he’s burying us. But the vast majority of people are sort of hanging out in the middle. They see this as an unusual event. If they cast blame, they do it more on the financial system than anything else.”

Obama’s popularity here is a matter of geography.

“Where you stand depends on where you sit in Colorado,” says Martin Shields, an economist at Colorado State University. “If you give a talk in Boulder, everyone thinks he’s great. If you give a talk in Colorado Springs, everyone thinks he’s awful.”

Polls show the president locked in a tight race with Romney in a state where Obama trounced Republican John McCain by about 9 points. In 2008, Obama set his sights early on Colorado — he accepted the Democratic nomination at the party’s convention in Denver — and cobbled together a coalition of big-city Democrats, Hispanics, young people and suburban independents, especially women.

Colorado, once largely red on the map, turned blue in the 2000s, after hundreds of thousands of newcomers settled in the state, many from traditional Democratic areas. Core GOP constituencies — evangelical Christians (Colorado Springs is home to Focus on the Family, the conservative advocacy group) and Western individualists — became less dominant.

In 2008, Obama became just the second Democratic presidential candidate in 40 years to capture the state. Bill Clinton’s 1992 win came is a three-way contest.

Four years ago, Democrats, Republicans and independents were registered in almost equal numbers on Election Day — independents actually held a tiny edge.

That’s changed and even though Democrats now hold the governor’s office and both U.S. Senate seats, the GOP has a numbers advantage. Among registered voters, Republicans exceed Democrats by more than 115,000.

More than 30 percent of those registered are independents and they’re expected to be pivotal in the election. They include libertarians who’ve heavily supported the GOP in the past.

That could bode trouble for Obama, but both the president and Romney face obstacles, says John Straayer, a Colorado State University political scientist.

“I don’t think there’s the excitement and support you saw for Obama in `08,” he says. “They’re not happy with the health care bill, but many are unhappy because it didn’t go far enough. ... But I do think those people are going to come home in November.”

Straayer also says he doesn’t “detect a groundswell of affection,” for Romney, who lost the caucuses to Rick Santorum. “But Republicans are going to rally around him, no question about it. They don’t have any place else to go.”

The finale outcome, he says, will likely be razor-thin.

“If I had to bet on it, I’d say Obama, but I’d look at my right pocket to see how much change I have,” Straayer says. “I wouldn’t look at my left pocket because I have dollar bills in there.”

The results will undoubtedly turn, in part, on Hispanics, who account for about 20 percent of the population and have, so far, overwhelmingly favored the president. Republicans, aware of their underdog status, have tried to hit the president on the economy, producing a Web video in English and Spanish that claims Hispanics have suffered disproportionately under his policies.

But a June survey by Public Policy Polling gave Obama a whopping 27-point lead among Hispanics here. Some of those polled were questioned after the president announced he was halting the deportation of many illegal immigrants brought to the United States as children.

Immigration actually ranks third in importance in polling of Hispanics, with the economy and education rating No. 1 and No. 2, says Floyd Ciruli, a Denver pollster. But, he says, “it’s almost a litmus test issue — do you have at least sympathy and understand the issues we’re dealing with?”

Economic concerns, though, will remain at the heart of the race and a Wells Fargo July report concluded that while Colorado’s economy appears to be losing a “bit of momentum” heading into the second half of the year, there is improvement, including in construction and housing.

The construction industry lost nearly 70,000 of its 170,000 jobs in the recession, according to Michael Gifford, director of the Associated General Contractors of Colorado. In the Denver metro area, the number of housing units built plummeted from 30,000 in 2006 to 3,000 three years later, he says.

“Think about that scale — that’s not just looking out and not seeing any more housing, that’s just not the associated loss of business for real estate agencies, banks and title companies, that’s the loss of income taxes, sales tax and property taxes. ... It affects the whole economy.”

More than 10 percent of the jobs have returned, Gifford says. “It feels good to be walking slightly uphill than riding downhill,” he adds.

While the recession hurt almost every industry in Colorado, some entrepreneurs defied the odds.

Consider Brian Seifried, just 20 when he opened a hole-in-the wall chicken wing shack eight years ago in Greeley. He expanded during the recession and in June, opened his fourth place in a 30-mile range.

When the economy was sinking, Seifried says he’d pass foreclosure signs and weed-filled lawns, amazed by his good fortune, but keeping mum about it. “There were times when I was self-conscious talking to neighbors and fellow business owners,” he says. “I kind of played down our success just not to come across as bragging.”

He had a few things going for him: A business that gave families a chance for a night out without spending much. “I think people want a sense of normalcy, even in the tough times, a feeling that things are going to be OK,” he says. And frugality: Seifried settled in a 650-square-foot house, bought his first two places with cash and secured a Small Business Administration loan for the third.

Politically, Seifried says he agrees with the president that the top 1 percent should contribute more taxes, but “I don’t feel the federal government is efficient with the money that they do bring in. ... I’m only 28. I consider myself socially liberal. but I don’t think Democrat or Republican is the answer.”

Seifried’s base is Weld County, in northeast Colorado, the hub of new prosperity, where an oil boom is transforming the region. The result: about 8,000 new wells, 15 new gas and oil companies and thousands of new jobs (some paying $75,000-$80,000) in recent years, according to Sean Conway, chairman of the county board of commissioners. Investment could be about $15 billion by 2015, he says.

Even sweeter: record prices for corn, wheat and other commodities in the area, Conway says. (The drought, though, could have a devastating impact on the ag economy.)

Despite the bright long-term future, Conway — he came up with the “Swiss cheese economy” label — says folks here remain uneasy.

Politically, this is predominantly red country — McCain carried it by almost 9 points — and Conway ticks off a long list of local grievances against the president: His energy and tax policies. His push for tighter financial regulation. The health care bill. The general state of the economy.

“There’s a lot of fear out here,” he says. “There hasn’t been a turning point. ... So many folks have been working so hard to keep the roof over their heads, they’re just reaching an exhaustion stage. They say, `Look, he (Obama) had three or four years ... I don’t think he really has a plan going forward to get people back to work.”’

Conway, a Santorum supporter in the caucuses, now backs Romney, saying he likes his positive “Reaganesque message.”

Less government

The Reagan philosophy of the-less-government-the-better is an appealing message in the West, including to some in Pueblo.

“Government is too big and too much involved,” says Bob Fredregill, who with his brother, Jim, owns the La Renaissance restaurant. “These are taxpayer dollars and we don’t have enough of them. ... We have created such massive entitlements in this country.”

But while some accuse the Obama administration of excess spending, others credit the president for steering the country away from an even bigger financial disaster.

“I think he has saved us in a way we’re not even cognizant of,” says Dawn DiPrince, who teaches English at Colorado-State University-Pueblo. “I think it could have been worse than we even envisioned. He kept us from falling over the cliff.”

DiPrince says even though she believes Obama could have been more progressive, she’s been “re-energized” by some of his recent moves, including the immigration rule change. She also says she finds Romney’s message “scary. He clearly is on the side of the big money people.”

She’s one of many fans the president still has in Pueblo. Obama, who visited here twice in 2008, carried the county with nearly 57 percent of the vote.

This is an industrial city whose history reflects both the economic might of a bygone era, when U.S. manufacturing was king, and an ambitious blueprint for the 21st century — renewable energy. Symbols of both industries line 1-25.

The dinosaurlike rusted remnants of a giant steel mill still stand, a reminder of the glory days when it employed more than 22,000 workers (some were in the mines). When steel collapsed, Pueblo’s jobless rate skyrocketed to 20 percent. Today, the city has a diversified business base, and steel remains in much smaller numbers: Almost 1,200 people are employed at a Russian-owned mill.

A few minutes away is a modern, sprawling plant with a giant tower (almost 300 feet), home to Vestas, the Danish wind energy giant. The plant here has about 400 workers building massive towers for wind turbines.

The fate of the industry, though, hinges on decisions made on Capitol Hill. Wind energy tax credits are due to expire at the end of the year and any delay or cutoff could lead to business losses and plant layoffs. Obama supports the extension but the issue is tied up in Congress.

It’s the kind of logjam that frustrates some who blame Republicans for thwarting Obama’s progress on other matters.

“I think the president has had a lot of good ideas but many of the Republicans in Congress have purposely stopped some of them just because they don’t want him in office,” says Carole Partin, a former teachers union president in Pueblo. “I think that the economy could be doing better if people were truly working for the United States, rather than working for their party.”

Mary Oreskovich, who owns Hopscotch bakery in Pueblo and volunteered for Obama in 2008, says it’s hard to cut through the spin on both sides. She still supports the president, though the thrill of that first campaign is gone.

“It’s been a really rough couple of years (running her business). I’ve hung on and I don’t attribute that to any politician,” she says. But “I still believe in him. . It may sound completely Pollyannaish but I think he’s a good man. Deep down, I think he’s a good man.”

In retrospect, she wonders, too, if she had unrealistic expectations.

“I think I was a little naive,” she says, “when I thought things in Washington would really change.”