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20 June 2009

Comments

George Rebane

[The following italicized comment to this post in the The Union is from Steve Frisch. My response on the newspaper’s website overruns its 950 character limit, and is posted here in its entirety.]

George, is attracting NEW business really the major driver of rural economic development?

It seems to me that most new employment is created by existing businesses expanding or creating new products and services through the application of innovation, especially in rural areas. As you have previously pointed out another tried and trued means of generating new wealth is leveraging the multiplier effect by recirculating dollars in the local economy more efficienctly. Another new trend, local niche manufacturing, is beginning to take root.

I agree that if we can attract new business it is good, but wouldn't a more balanced approach where we simultaneously attract new business, and build human skills to expand on existing assets, might be more appropriate to our area?

How can Sierra College make our existing businesses stronger, more resilient to change, and prepare our residents to help them by driving expansion through innovation?

Steve, good thoughts. By “rural economic development” I understand you to mean ‘economic development of rural areas’. (Discounting marijuana, agriculture in NC contributes less than 5% to our economy, however we all agree that the open lands and forests are a big tourist draw and enhance our quality of life.) Attracting new business has not been the recent “major driver” of our economy, but that is one of the assigned tasks of the ERC which receives the major part of its funding from the county. As I have argued before on Ruminations, I don’t think that NC is a competitive site for locating private sector, for-profit manufacturing companies, especially in this economical climate. But new federally mandated businesses supported by newly printed dollars making products, that consumers are forced to use, may be another story altogether. Planning for sustainable economic growth by attracting such businesses seems more than risky to me, as witnessed worldwide in other planned economies of a socialist hue.

But ultimately, any regional economy like ours needs to import cash from the outside – we cannot sustain ourselves by selling services and homegrown vegetables to each other. Without cash from the outside, we become a poor community reduced to barter. Right now one of the major cash importers in NC (over $1 billion annually) are the retired residents. Of course, tourists also import cash (especially on this Sunday). It is this imported cash that then circulates in the county creating the ‘multiplier effect’ before it finally all leaks back out again. I may be overlooking something important, but the development of information generating businesses, that sell their information products to the outside world, should be the main focus for using public monies to attract new and/or grow existing businesses. Our local Sierra College campus should be dedicated to serving that end.

Mike Walker

Your article on Sierra College was one of the better commentaries I've seen in The Union.

Mike Walker
Sunset Travel

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