When Arun Raha ’91 started work as the state of Washington’s chief economist three years ago, his new staffers welcomed him with a gift: an official Magic 8 Ball.

“I said ‘OK, great! Now I have a forecasting tool,’” he recalls.

If only it were that easy.

At 51, Raha is the E.F. Hutton of state government: When he talks, people listen. He speaks at more than 100 events a year, from universities to small-town chambers of commerce. His quarterly revenue forecasts are broadcast live on TV.

That’s because the forecast, once approved by a bipartisan council that Raha reports to, frames the state budget. Legislators and the governor decide how much to spend on schools, higher education, social services, and so on. But the total they can spend is largely determined by Raha and his staff.

The numbers “are central to the Legislature’s spending decisions,” says state Sen. Joe Zarelli. “When we talk about budget shortfalls or surpluses, it’s based on Arun’s forecasts.”

Economic forecasting has been compared to trying to drive a car forward while looking only in the rearview mirror. To get it right, Raha looks at things like car sales, building permits, Boeing orders, exports, oil prices, and data on how hard it is for small businesses to get loans. The public appearances are a part of the job, but he also likes them because he gets a street-level view of the economy from farmers, engineers, and businesspeople.

“It allows me to be like the guy up in the ship’s crow’s nest with his eye over the horizon,” he says. “I get to hear what’s going on before it shows up in the statistics.”

A native of Kanpur, India, Raha got his first taste of America in 1985 when he arrived at WSU to study for his doctorate in economics. He’d passed the grueling civil service exams for an Indian government job, but wanted to live overseas. His boss promised to hold his job open for nine months.

WSU had offered him a teaching assistantship and a low-interest loan. Both proved critical. At the time, Indian currency controls meant he could bring just $750 to the United States.

“They made me feel that if I came there, they understood all the issues I’d be facing as a foreign student, and they would take care of me,” he says. “I’ve never regretted the decision.”

Arriving alone at a largely-deserted campus on a Friday evening, he was relieved to run into a woman wearing a sari. She helped connect him to WSU’s Indian student network.

After nine months, he was sure he wanted to stay.

“I knew that if I put in the effort,” he says, “I would make it.”

And he did. While finishing his doctorate, he took a teaching job at Boise State University. To earn extra money, he started forecasting revenue for the Idaho legislature and tax commission.

By the late 1990s, he was head of Asia forecasting for a firm in Pennsylvania. Then on to Ohio, working on strategic planning for Eaton Corp., a large industrial manufacturer. By 2007 he was a vice president at the insurer Swiss Re and had won national forecasting awards from the Wall Street Journal and the federal reserve bank of Chicago.

Still, Washington state beckoned, particularly to Raha’s wife, a San Juan Islands native. He was hired as the state’s chief economist in 2008. He quickly gained a reputation for peppering his economic forecasts with humor.

“This is not the first time I have been led astray by a model, but that had nothing to with economics,” he joked shortly after arriving. His presentations are in plain language, sometimes using sports analogies to describe what’s going on.

“There’s a lot of technical work that we do that goes into every forecast,” he says. “But you have to able to communicate that, in a non-technical way, to intelligent audiences. That’s part and parcel of being an economist.”

The news he had to convey, however, quickly grew bleak.

“Shortly after the September forecast… what had been until then a festering financial malaise exploded into a full-blown global crisis,” Raha told lawmakers in November 2008.

By February, it was worse.

“Washington’s economy, which had been outperforming the nation, hit the wall late in the year,” he says.

And the recession continued to drag on.

“We are witnessing an unprecedented economic crisis, the likes of which we have not seen since the Great Depression,” Raha told the state forecast council in March 2009. “That is not to say we are headed there, not by a long shot. But No. 2 isn’t exactly great, either.”

The recession finally ended in June 2009. But both jobs and state revenues have been very slow to recover. Lawmakers in Washington, as in most states, are struggling to make deep budget cuts.

Raha carefully avoids any discussion of the budget impacts of his forecasts. It’s the prerogative of elected officials to make spending decisions, he says. The best thing he can do for them, he says, is to get the forecast right.

Still, he leaves the jokes out of his forecasts these days. The news is too dour.

“This is not a normal recovery,” he says. “This is a recovery following a financial meltdown.” He thinks that a full recovery, with employment returning to early 2008 levels, is still at least two years away.

“Once I start cracking jokes again,” he says, “you’ll know the economy’s on the mend.”

On the web

Washington State Economic and Revenue Forecast Council