Saturday, December 31, 2005


Hoosiers love to discuss the problems with the Indiana economy. Our Governor often points out that, “Hoosiers earn less than 90 cents for every dollar the average American earns. These losses result in diminished hope and opportunity for Hoosiers around the state and sagging revenue for state government.”

<>So what do we do about it? Can state and local government really play a role in improving the economic well-being of our citizens? Is trying to recruit companies to move here from another state to “bring jobs to Indiana” the only trick in the economic development grab bag? In order to have better jobs and higher income in Indiana, do we essentially have to take those from someone else? Or, can we find a way to produce more jobs and wealth through public policies that make better use of the resources we already have? <>

The answer is, “Yes!” There is a formula for growing jobs at home. 85 percent of the new jobs created in Indiana come from companies that are already here or are being started here. We can do it with the people and tools available to us, and here is how. <>

The solution to increasing wealth and a better standard of living is called “productivity”. Improved productivity increases wealth for individuals and for the economy as a whole. It means getting more done in less time. It doesn’t mean necessarily working harder or working longer hours. It does mean working smarter. <>

Now, working smarter comes in two broad categories. First, we must all be smarter workers. Whether we are working in a factory, providing a service, growing food, or engaged in any other economic activity, modern competition dictates that the workers who make the best decisions, get the most done with the resources they have, and maintain the best quality, will be the economic winners. <>

The second category of improved productivity comes from the use of the best possible tools. Even when we have to invest a little more to get good tools, the increase in productivity more than offsets the cost. <>

If those two principles are true, then government can help to enhance the private sector by encouraging both a better educated workforce and investments in the “tools” that make Indiana the place where the job (any job) can best get done. <>

Now these aren’t new concepts. As long as Indiana has been a state, education has been a recognized priority. Our ancestors also recognized that public utilities like water and highways were the keys to helping all Hoosiers live easier and more productive lives. <>

We are facing many modern challenges and changes, though. Ending your formal education after 12 or even 16 years is no longer sufficient to keep you productive enough to stay ahead of the competition. Hoosiers and their government need to accept, as a part of the cost of the lifestyle they seek, that they will have to continue to educate themselves throughout their working lives. Sweating over the horse drawn plow or the wood fired oven was the cost of a daily living for our ancestors. Today, the muscles of labor that provide our living are less in our arms and our backs, and more between our ears. <>

The challenges for policy makers in regard to an educated workforce are how to structure effective educational institutions, how to pay for them, and how to make them available to all Hoosiers. We must also provide leadership in encouraging people to take advantage of those opportunities. How do we increase the graduation rate? How do we get more students into programs beyond high school? How do we encourage adults to continue and expand their educations? How do we keep more of the people we pay to educate in Indiana? <>

Providing better “tools”, from a public policy perspective, means strategies aimed at both the private and public sector. We must all look for ways to encourage (or at least not discourage) private investment in buildings and equipment for increased productivity. <>

We have also come to accept that certain investments in assets valuable to all citizens are proper expenditures for tax dollars. Roads, streets and bridges, utilities, and public safety services are not just conveniences, they are necessary for economic activity. State and local government in Indiana have failed to prioritize our infrastructure needs for too long. We have to address issues like highways that are inadequate to our economic needs and sewers that don’t measure up to our environmental expectations. <>

The 21st Century has brought some new demands to our infrastructure needs. Threats of terrorism place new stresses and burdens on our productivity. We need to deal with those costs rationally and effectively. <>

Most of the world’s economic growth potential is in information technologies and intellectual property. That includes health care, business practices, communications, entertainment, and a variety of other economic activities. Unfortunately, Indiana is well behind the nation and the world in development of information infrastructures. Our lack of access to fiber optics and wireless broadband is a serious detriment to our ability to grow a modern economy. The technological tools exist. In Indiana, we don’t yet have the political will to make it happen.<>

<>The bottom line is that there is neither reason nor time for Hoosiers to feel sorry for themselves. A better future is available to us. All we really need to do is take a dose of the advice that we give our own children, “Study hard and invest your money wisely.” If we can adopt that advice as public policy, Indiana will prosper once again.


Blue Cross of California said...

Great blog I hope we can work to build a better health care system as we are in a major crisis and health insurance is a major aspect to many.

Jeff said...

There is no doubt that creating more productive Hoosiers will help the economic development of Indiana. As you said, education is one of the keys.

However, it seems to me that luring businesses to Indiana is also a key factor to preventing "brain drain." If Hoosiers are better educated - and thereby more productive - they are going to be in greater demand and Indiana needs a way to keep them in state. If the opportunites aren't available in Indiana, the educated Hoosiers will leave the state for greener pastures.

Anonymous said...

no toll roads at all ok good