Speaker looks to throw out state’s baby with the bath water
Written by Michael Lewis on February 7, 2017
A war on economic development led by the speaker of Florida’s House could leave the state’s economy in shambles by reducing new high-paying jobs to employ our fast-growing workforce.
Speaker Richard Corcoran is attacking not only the state’s two key development arms, Enterprise Florida and Visit Florida, but also 38 regional development and tourism agencies, as we detailed last week.
It’s part of Mr. Corcoran’s assault on what he calls corporate welfare for the top 1%. To end that, he would shut down Enterprise Florida and Visit Florida and seems intent on squashing local and regional agencies that also aim to create more good jobs.
That’s “the dumbest idea I’ve heard in my time in the Florida Senate,” Sen. Jack Latvala of Clearwater responded last week to the aim to kill both state agencies, to which Mr. Corcoran replied: “A tremendous intellectual argument on his part.”
We can’t mind-read what Sen. Latvala might have replied, but better arguments abound for the state continuing to bring jobs and tourists into Florida than for letting others woo them while we sit on our hands.
Those who oppose development agencies object that they spend state money to reward companies that create good-paying jobs in targeted industries in Florida.
That’s a fair argument – even though jobs are only rewarded after they exist – and if other states and regions didn’t pay job incentives we shouldn’t either. It’s like disarmament: if others didn’t build armies we wouldn’t have to. But it’s hard to be the only one to disarm, or to stop paying incentives for new jobs. Doing so unilaterally puts you at a huge disadvantage.
Even if Florida were to cancel job incentives, however, development agencies would remain vital, because incentives are only a sliver of their tool chest, just as armaments are only a part of how nations deal with one another. In nations there is also diplomacy, just as in economic development the really big part of the job is marketing.
In Miami-Dade, for example, the Beacon Council ushers in site selectors from around the US that larger companies hire to seek expansion sites. I’ve ridden with them as Beacon Council officials educated those key players on our advantages, some only obvious if you had data the Beacon Council supplied on everything from school quality to projected population growth. That’s marketing the area.
Another aspect of marketing is simply asking businesses around the globe to operate here. Not all of them get – or even seek – incentives for creating jobs. Incentives are often almost incidental.
Then there’s cutting red tape. Development agencies help businesses surmount regulatory hurdles to build and expand.
The best development agencies focus on the business climate. Speaker Corcoran is on target in saying we need better schools and infrastructure to lure business, but it’s not either-or: we need to both improve the business climate and market that improvement elsewhere.
New jobs, after all, don’t just flow through the door. Salesmanship helps. Not everyone is going to move for sand, sun and sea, and our other assets are less evident. Think of simple tools like brochures and area economic reports. Economic development groups create and distribute that material to likely targets.
Another element of marketing is to dispel misconceptions. In Europe, the old Miami Vice image of a crime-ridden community is just now being replaced by an Art Basel-inspired image of culture. Organizations like Visit Florida do that.
Proactive marketing in group trips and individual visits also boost our tourist and business environment around the globe and nation. Not all these efforts succeed, but cut them all off and you can be certain of large economic falloff.
Finally, development agencies join with business, civic and educational groups to upgrade an economic climate, just as tourism groups improve tourist climates. In Miami-Dade, efforts like One Community One Goal to target key jobs and Miami Nice to improve visitors’ experience stem from such agencies.
We agree with Speaker Corcoran that marketing efforts don’t always maximize benefits. But the best response is to improve, not stop trying.
A bill that would slam the door on economic development at the state level was to be heard this week in the House Careers & Competition Subcommittee. As the bill flows ahead, business should tell legislators why visitors and jobs don’t all migrate in naturally, and how our development and tourist arms don’t cost us money – they bring us far more than we spend.
At the same time, business should look seriously at paying a larger slice of the cost of those agencies instead of the present 10% to 15%. It can’t plausibly be called corporate welfare if business is paying more in than incentives pay out.
If we stop promoting tourism and the climate in which to establish jobs, Speaker Corcoran will be able to say that he led the fight to halt not just corporate welfare but the welfare of the state and its residents. Businesses statewide must band together to finish Sen. Latvala’s explanation about why shutting off a big spigot for jobs and visitors is the dumbest move Florida could make.