Shuman on alternative models of economic development

I have a guest editorial piece in today's Palladium-Item, End risky economic games.  I've also reproduced the edited version of the piece below.  I had originally hoped to title it "What can James Bond teach us about economic development?" but I decided that's not actually a question I want to know the answer to.  So instead the article focuses on two different labels for economic development models, coined by author Michael Shuman.

I first saw Shuman speak at a conference back in 2005.  He's an economist, attorney, speaker, author and entrepreneur, and he's written a number of books on the economic why and how for creating thriving, self-reliant communities.  In particular, he posed the labels of "TINA: There is no alternative" and "LOIS: Local Investment and Import Substituting" as shorthand names for the dominant economic development model of today (TINA) and an alternative model that he sees having great success and sustainability on paper and in practice (LOIS).

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A City is a Startup

biodiversity jengaOver the weekend Jon Bischke made the interesting comparison of a start-up company to city government in A City Is A Startup: The Rise Of The Mayor-Entrepreneur.  Bischke notes that the factors that go into a successful entrepreneurial effort are similar to the ones that make for a successful city:

  1. Build stuff people want, offer products and services people want to buy
  2. Attract and retain quality talent
  3. Raise capital to get fledgling ideas to the point of sustainability, create a density of "investors"
  4. Create a world class culture that encourages people to stick around even when times get tough

These may not be comprehensive factors, but they could be useful metrics to view your city with.

If I had to rate my own city of Richmond, Indiana, I'd say we have plenty of room to grow in each area:

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Starting the creative day

Another mugI work in a world with a lot of artificially constructed structures and images, and those structures and images have a lot of straight lines, right angles and cold, industrial, unfeeling surfaces.  Computer monitors, e-mail composition windows, 8 1/2 x 11 paper with black lines on it, rectangular desks, rectangular parking spaces in dark grey rectangular parking garages, and so on.

It's also the case that I try to do creative work: building interactive and engaging websites, collaborating with people to find innovative solutions to challenging problems, creative writing, creative thinking, and more.

Sometimes it can be a challenge to do creative work surrounded by pieces of infrastructure that don't elicit creativity, and that sometimes even discourage it.

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Life In a Day, a crowd-sourced documentary

You should watch the film Life In a Day.  It's a crowd-sourced documentary assembled by the folks at National Geographic and YouTube, where folks from around the world sent in 4,500 hours of video footage of their lives as recorded on July 24th, 2010.  (Don't worry, the film itself is only an hour and a half.)

Life In a Day weaves together moments of joy and sadness, frivolity and struggle, plainness and great beauty into a wonderful fabric of the human experience.  It at once shows the ways in which the routines of our days are shared across cultures and landscapes (we wake, we clean up, we eat, we interact, we travel, we love, we argue, we sleep), but also the stark contrasts of wealthy and poor, privileged and oppressed, healthy and unhealthy, troubled and care-free.

There are only a few "characters" we see multiple times throughout the day - a man bicycling around the world, a family struggling with cancer - but the amazing editing and soundtrack create a story arc grounded not in personality or plot twist, but in the experience of having 24 hours pass and all of the amazing (or mundane) things that can happen in that time.  It's a masterpiece that will perhaps seem quaint in a few decades, but that could not have been possible even 5 or 10 years ago.

Life In a Day is inspiring and moving.  Best of all, it's real.

Here, you can start watching it right now:

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The closing of Really Cool Foods

Groundbreaking for Really Cool FoodsIn 2007, organic prepared food producer Really Cool Foods announced that it would be building a multi-plant production complex in Cambridge City, Indiana and investing over $100 million in the area.  The announcement was met with great joy and significant incentives from state and local governments:

The Indiana Economic Development Corp. offered Really Cool Foods up to $3.05 million in performance-based tax credits, up to $165,000 in training grants and will provide Cambridge City officials with a $200,000 grant to assist in off-site infrastructure improvements needed for the project. Wayne County officials offered the company 50 acres of land, $165,000 in grants and a 10-year property tax abatement.

The facility opened in October of 2008 with 250 of the projected 1,000 jobs to start, and over the last few years the company has had numerous challenges reaching initially estimated milestones of investment and jobs created.

Today, the company told workers who showed up for their morning shift that the facility was closing, and in a press release sent after 9 AM, announced the company is shutting down.

A couple of initial thoughts and questions about this unfortunate announcement:

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Quantitative easing and structural unemployment

Globalization // Coming 2 a mystical cliffside near u - v.2That title really roped you in, huh?  Allow me to explain.

Earlier today I attended the Indiana University 2012 Business Outlook Panel in its visit to Richmond.  It's a group that "has presented national, state, and local economic forecasts for the coming year to business, political, and community leaders of Indiana" for the last 38 years.  I attended the same gathering back in 2005 and I have to say that today's commentary wasn't much different from what it was six years ago: "things are not great with the economy, but there are reasons to be cautiously optimistic."

As I noted in my reflections from the 2005 event, there were a couple of troubling ideas that permeated the remarks, especially from the panelists looking at global and national trends.

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Job creation at a human scale

ForgeIt's unfortunate that the act of finding or creating a job for someone has become a form of political currency.  Politicians around the country are clamoring about how many jobs they created with this program or that program, or boasting about how their job creation (or job loss) record compares to someone else's for a given time period, while many rightly ask if politicians can really even create jobs (answer: probably not).  When we set aside the political rhetoric, we remember that for most people, a job is not a statistic to be waved around in the media and that finding or creating a job is not the end of the story.

For most people, having a job is a means to other ends - making money to help provide for our families, a place where we go to be productive and feel a sense of accomplishment, a foundation on which to build a quality of life.  Most people don't want to live so they can work - they work so they can live.  And so it's disconcerting when politicians casually talk about job creation as the end in itself, without any concern for or follow-up on what that means for the people in a given community taking those jobs.

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