Sunday, November 25, 2007

Measuring the size of economic development

Does anyone really expect the arrival of a massive industrial company to save Anderson's (or Muncie's or Marion's or even all of Indiana's) economic hide? Who is pining for the days of a Delco-Remy employing twenty thousand people?

Folks, it is not going to happen. Automation came and with it the need for a large workforce in one factory left at the same time.

This bit from Scotland's Sunday Herald got me thinking on these lines, Fishing fan who landed himself:
Glasgow Angling Centre boss Paul Devlin has similarly crept up on the angling trade to land himself a multi-million pound business.

The 40-year-old from Cumbernauld now controls the largest fishing tackle retail outlet in Europe and an internet and telephone ordering business with customers in every continent.
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His 80 staff, most based in Glasgow, generate a turnover of £8 million a year, a figure that has been growing at between 10-20% per annum.
Eighty people turning out that gross profit (which with the dollar being as weak as it is, I have no idea what that means in dollars but it is a lot more) make this business a success.

Talking last week with a father of a client, he said that Anderson would not recover for two generations. By then the "union mentality" would have died out. I grit my teeth whenever I hear the phrase "union mentality". I do not see it in my clients and I do not see it in most of the people I know in Anderson. I find it a one-sided shorthand for a self-satisfied complacency that deals poorly with competition. Reading Delorean too many years ago lead me to the opinion that General Motors epitomized this sort of complacency.

We need to import businesses such as Nestle. I have no problem with importing businesses except where it leads us to ignore the possibility of developing our own businesses or encouraging the idea that one company will save the town (or the state). I believe that there are many people out there with good business ideas who have no idea how to develop those ideas. I will go even further and say that some of those same people have UAW union cards.

Getting that one big company does have the benefit of being easy. Well, easier than helping a bunch of small businesses come into being - and with no guarantee of long term success. Getting that one big company is a mirage. We should tar and feather anyone who advocates getting that one big company for saving our economic hides.

Creativity that remains untapped turns sour. I would think that a city which shows that it can foster economic growth becomes more attractive to outside businesses. Nor do I think this sort of economic development belongs to the Republicans. During the Reagan years, the Republicans made much of being the party of entrepreneurs. I still think they were full of BS. Why? The Reagan Republicans were not so much interested in those on their way up as in those already there. Take a look at the career of Michael Milliken and you will see what I mean. Small businesses ought to have more in common with the Democratic Party in the same relation to what they have in common with GM.

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