Economic Development, Same Old, Same Old

[Cardinal]

My state ED organization just sent out a survey to get a handle on our membership and what we do. I commend them on that. It is good to have this information and I hope it will be used to educate politicians and the public.

So here's the problem. After getting through the usual public or private?, what's your budget?, and how many people work there? questions, they got to the meat. What do you do? And the choices were the ones that, I am sure, were on the first survey of economic developers ever put together; the kind of thing you might find in a text book from the 1950's. Economic diversification. Business retention. Business attraction.

It is a sad reflection of the backwardness within the profession of economic development, that not even the practicioners see the big picture. Excuse the shout. ECONOMIC DEVELOPMENT IS NOT ABOUT CHASING INDUSTRY! IT IS ABOUT CREATING CAPACITY WITHIN A COMMUNITY TO ACHIEVE THE ECONOMIC OPPORTUNITY AND QUALITY OF LIFE DESIRED BY ITS CITIZENS!

A good economic development agency will spend only part of its time in selective business attraction and part of its time in bolstering desirable existing industrial groupings. Half or more of its time should be spent in working to create the right conditions for the desired industries and improving the local quality of life. That may mean high speed internet access and wireless community networks, bike paths, environmental quality, educational programs and the like.

Another case in point. Our state is coming up with a grand plan to boost the economy of the state. It is a complete joke! Grounded in empty statistics that fail to paint an accurate picture of the situation but are politically popular, it rehashes a handful of weak ideas borrowed from other states that can at best only superficially deal with the underlying problems. Its name, "Build Wisconsin" harkens back to the "Build Illinois" program of the 1980's. Its ideas are about as fresh.

It is frustrating to have vision; to see the big picture and continually run up against the myopic and narrow-minded ideas of those who allegedly lead our state and our profession. I take comfort in the fact that there are a handful of others in my state who share my desire to see a new paradigm, a new definition of economic development for a new century. Perhaps if we continue to push....

 

[mike gurnee]

Very well written, and thanks for the rant. Your "new" paradigm was part of my graduate program in the late 70s...now, when will the Chambers of Commerce learn? Our local ED agency is spinning its wheels trying to get around zoning and environmental considerations for one industry.

 

[Jen]

Your comments are practically word for word, Michael, from my ED prof's lecture this week!

I am back in school and enjoying the online library access and today I looked up Community Development at ABI INFORM. I was kind of surprised at all the grant money (CDBG) going to put in roads in industrial parks and extend infrastructure to industrial parks and money that pays for remuddling storefronts. And even federal dollars to major law firms in NYC, who had no intention of leaving the city after 9/11! One of the articles I read was about council members looking for a place to put the last $70,000 of their grant - they decided to prop up store fronts while admitting their own local Dial A Ride transportation system that serves the elderly and disabled is in danger of shutting down?

Is it really anything goes with Comunity Develpment Block Grants?

 

[mike gurnee]

A nation wide problem with CDBG is that towns do not spend the money fast enough to suit Washington. This leads to the trap of spending the cash on projects that can be done and over with quickly. In the case you cited, helping the dial-a-ride program would probably take too much time for the grant cycle.

 

[Cardinal]

There are good examples of the use of CDBG money. Dane County, Wisconsin (an entitlement area) uses a comnination of CDBG and county funds to fund its BUILD (Better Urban Infill Development) Program. This program provides funds to county communities for feasibility and planning studies that support downtown redevelopment/revitalization, infill development and similar projects.

Then again, the CDBG program is also rooted in the 1960's and is sorely in need of an update. For example, there is still the $20,000 per job created requirement. No matter whether it pays minimum wage or $20 per hour, no matter if it is full or part time, no matter if it includes full benefits or not. (Don't get me started on "job retention" - what a scam!) Some of us have argued that this is an example of the "old thinking" that has to go away. I would gladly provide a loan to a company getting rid of a number of low paying jobs if it meant investing in new technology increasing the company's competitiveness and requiring it to invest in employee skills, with commensurately better pay and benefits.