M II A II R II K
Senior Member
Building a New Financial Base
November 10, 2011
By Penelope Lemov
Read More: http://www.governing.com/columns/public-finance/building-new-financial-base.html
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At the city-metro level, there has been too much focus on what we call Starbucks, stadia and stealing businesses. It's a consumption-driven growth model that in the end doesn't really expand and extend your economy. It's just recycled income. We've got to grow the pie. We believe, as do many others, that we need to use this past recession as a wake-up call and shift to an economy that first and foremost is driven by exports, greater global engagement, and the production of high-value goods and services -- building off what has been our manufacturing base and advanced-services base. That will be the way to enhance the fiscal base of cities. Exporting firms, manufacturing firms and innovative firms pay better wages for a broad spectrum of the workforce.
- The first thing that has to happen is the cities and metro areas need to understand their position in the global economy. There was a uniformity about the prior economy: a Wal-Mart is a Wal-Mart is a Wal-Mart whether it's in Phoenix or Pittsburgh. But what Phoenix and Pittsburgh trade within this country and with the rest of world is completely different. My view is that going forward cities and metros need to be very intentional and purposeful about building on special assets and strengthening their distinctive strengths. If you do that, housing and retail will follow. Those are derivative -- not driving -- sectors. We lost sight of that fundamental economic fact.
- As a starting point, successful metro areas understand who their trading partners are domestically and globally. You see this in Seattle and Northern California. They interact on a constant basis with the cities and countries they trade with and strengthen the linkages between their communities and their trading partners abroad. A lot of trade growth is relationship-driven. At the city level, what matters are relationships between and among elected officials, investors, manufacturers and service firms. San Francisco has become pretty adept at helping local firms identify markets abroad and helping Chinese investors find good investments here. That's next generation economic policy. In Los Angeles, Antonio Villaraigosa recently announced an export plan that will help businesses find the specific services they need. We're working with cities and metros on these export strategies.
- We are still a manufacturing powerhouse. The rise of China, India and Brazil opens up enormous opportunities for American goods and services if we can seize it. The bulk of positive job growth builds from current clusters and sectors. Stealing business from a neighboring state is a low road kind of growth. Building on special, distinctive strength is the high road. When you build a robust platform for advanced manufacturing or high-value services, that's the gift that keeps on giving. Development of a successful economy starts with an understanding of who you are. What is the distinctive nature of your economy. It's not how to be like everyone else, which describes the old economy -- building lots of housing, attracting big-box retailers. The next economy will reward places that build on distinctive strengths.
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November 10, 2011
By Penelope Lemov
Read More: http://www.governing.com/columns/public-finance/building-new-financial-base.html
.....
At the city-metro level, there has been too much focus on what we call Starbucks, stadia and stealing businesses. It's a consumption-driven growth model that in the end doesn't really expand and extend your economy. It's just recycled income. We've got to grow the pie. We believe, as do many others, that we need to use this past recession as a wake-up call and shift to an economy that first and foremost is driven by exports, greater global engagement, and the production of high-value goods and services -- building off what has been our manufacturing base and advanced-services base. That will be the way to enhance the fiscal base of cities. Exporting firms, manufacturing firms and innovative firms pay better wages for a broad spectrum of the workforce.
- The first thing that has to happen is the cities and metro areas need to understand their position in the global economy. There was a uniformity about the prior economy: a Wal-Mart is a Wal-Mart is a Wal-Mart whether it's in Phoenix or Pittsburgh. But what Phoenix and Pittsburgh trade within this country and with the rest of world is completely different. My view is that going forward cities and metros need to be very intentional and purposeful about building on special assets and strengthening their distinctive strengths. If you do that, housing and retail will follow. Those are derivative -- not driving -- sectors. We lost sight of that fundamental economic fact.
- As a starting point, successful metro areas understand who their trading partners are domestically and globally. You see this in Seattle and Northern California. They interact on a constant basis with the cities and countries they trade with and strengthen the linkages between their communities and their trading partners abroad. A lot of trade growth is relationship-driven. At the city level, what matters are relationships between and among elected officials, investors, manufacturers and service firms. San Francisco has become pretty adept at helping local firms identify markets abroad and helping Chinese investors find good investments here. That's next generation economic policy. In Los Angeles, Antonio Villaraigosa recently announced an export plan that will help businesses find the specific services they need. We're working with cities and metros on these export strategies.
- We are still a manufacturing powerhouse. The rise of China, India and Brazil opens up enormous opportunities for American goods and services if we can seize it. The bulk of positive job growth builds from current clusters and sectors. Stealing business from a neighboring state is a low road kind of growth. Building on special, distinctive strength is the high road. When you build a robust platform for advanced manufacturing or high-value services, that's the gift that keeps on giving. Development of a successful economy starts with an understanding of who you are. What is the distinctive nature of your economy. It's not how to be like everyone else, which describes the old economy -- building lots of housing, attracting big-box retailers. The next economy will reward places that build on distinctive strengths.
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