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Ellen Belcher is the Dayton Daily News opinion pages editor. She writes about state government, education, the environment, higher education and all things Dayton.
Martin Gottlieb is an editorial writer and columnist for the Dayton Daily News opinion pages. He focuses on the political process itself and does such national issues as war, the economy, taxes and Social Security, as well as a hodge-podge of local and state issues.Home > Blogs > A Matter of Opinion > Archives > 2010 > February > 26
Friday, February 26, 2010
Guest column: Manufacturing could boost Ohio once again
This commentary is written by Bruce Katz, vice president and director of the metropolitan policy program at the Brookings Institution in Washington, D.C., and Lavea Brachman, co-director of the Greater Ohio Policy Center in Columbus.
It can be hard to find good news in Ohio. Foreclosure filings are at record levels — again. Income tax receipts plummeted 35.6 percent from April 2008 to April 2009, and the downward trend continues in 2010.
Unemployment remains high: Dayton’s metro jobless rate reached 11.8 percent in December 2009.
But the current devastation is only half the story.
Ohio is in a paradoxical moment: The present is painful, but the future could be promising. And, in another paradox, its manufacturing heritage is part of the reason why.
The pre-recession economy was driven by consumption, energy profligacy and financial bubbles.
The next American economy must be very different: export-oriented, low carbon and innovation-fueled.
According to the World Bank, exports make up only 11 percent of U.S. GDP, compared to 40 percent in Europe, 40 percent in China, and 36 percent in Canada. Only 4 percent of U.S. companies export.
Ohio can lead the U.S. back into the export game, because the state still manufactures what the rest of the world wants, including medical instruments, electrical machinery and aircraft parts.
Brazil and China, two rapidly growing economies, are Ohio’s third- and fourth-largest trading partners. Dayton and six other large Ohio metros exported about $3.6 billion worth of goods and services to Brazil, India and China in 2007 alone.
Dayton is in the country’s top 20 large metros in terms of export intensity (the percentage of metropolitan region output that is exported overseas). The region is in the top third of large metros, and first in Ohio, in terms of service export intensity (education, consulting, health care). Dayton’s service export growth outpaces the national average.
Low carbon is the second hallmark of the next U.S. economy, and it could spark a production revolution in Ohio and other manufacturing states.
The transition to a low-carbon economy is fundamentally about markets and products. We will need new energy supplies — like biomass — and new machines — like turbines and solar panels.
Also, we will need new kinds of batteries, new kinds of cars and energy-efficient appliances, and smart meters. All of these products could be designed, developed and built in Ohio.
The state ranks seventh in the nation for total green technology patents for 1998-2007, with strengths in batteries, hybrid systems and fuel cells.
According to a recent report by the Pew Center on the States, Ohio’s number of clean energy jobs grew by more than 7 percent between 1998 and 2007, even as the overall number of jobs in the state fell 2 percent.
Creating the products and services demanded across the globe, and those that fit with a low-carbon world, will take quantum leaps in innovation.
Ohio attracted $46 million in venture capital investments in clean technology in 2008, more than triple the 2007 amount.
The state is in the top 10 nationally in science and engineering doctorates awarded; in academic research and development spending; and in small business innovation research awards, according to recent National Science Foundation data.
It is true that Ohio’s job losses, and Dayton’s in particular, in manufacturing have been staggering, especially with the recent closing of the Delphi and GM plants.
But manufacturing doesn’t have to be a millstone — it can be a steppingstone toward the next economy. Important innovations emerge from the factory floor. Innovating more means producing more, and that production can take place in Ohio.
This mindset should drive Ohioans’ policy decisions over the next year. It is not easy to raise spending on innovation, or to vote for an additional $700 million for the Third Frontier program, while pressing school districts and local governments to find more savings. But those hard choices will position Ohio for a stronger future.
The “Restoring Prosperity” report that the Brookings Institution and the Greater Ohio Policy Center just released recommends 39 policies — from rebuilding physical assets to collaborating at the regional level, that can help Ohio be strong in an export-oriented, low-carbon and innovation-fueled world.
The Downtown Dayton Partnership, CityWide Development Corporation, the Dayton Development Coalition and others have already started implementing some of these ideas, working to reuse vacant properties and build on neighborhoods and assets like the University of Dayton — all to become a stronger, greener city and region.
Yet, just as important as the policies is the underlying message: even as this economy falters, Ohio could benefit from the next one that’s emerging. Your strengths are just as real and relevant as the current crisis.
Bruce Katz is vice president and director of the metropolitan policy program at the Brookings Institution in Washington, D.C. Lavea Brachman is co-director of the Greater Ohio Policy Center in Columbus. They co-authored “Restoring Prosperity: Transforming Ohio’s Communities for the Next Economy,” which was released Feb. 22.
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Kevin Riley: We should keep an eye on Cuyahoga County changes
Cuyahoga County has an ambitious plan to change its government. We in the Dayton region ought to be watching and learning from it.
The most populous county in the state was rocked by scandal in its county government in the summer of 2008 when about 200 FBI agents raided the county offices in Cleveland and the homes of some county officials. That scandal is still unfolding with news of arrests, indictments and plea bargains. It has exposed a pattern of patronage and blatant corruption.
The scandal gave citizens the incentive to overwhelmingly pass a measure to radically change Cuyahoga County’s government structure — the same county structure virtually all Ohio counties have had since before the Civil War.
County government in Ohio has been structured in this way:
• A three-member county commission, elected by all voters in the county.
• More than a half-dozen elected county officeholders, including sheriff, coroner, auditor, recorder, clerk of courts, engineer, prosecutor and treasurer. These offices are also elected countywide.
Even a well-informed citizen would look at all of those offices and struggle to explain what the officials do. But, more important, county government in Ohio creates a confusing system of accountability. No one person or entity is responsible for the county’s overall spending, budgeting and planning. In Montgomery County, the total budget is about $900 million.
Things went wildly wrong in Cuyahoga County, where patronage jobs and other financial shenanigans showed just how dysfunctional the arrangement can become.
Montgomery and other local counties (except maybe Butler) don’t have the same traditions of misbehavior that Cuyahoga County has (though the county is embarrassed by the pending Southern Christian Leadership Conference scandal and its poor monitoring of public money it awarded that group).
In fact, folks from around Ohio generally view Montgomery County as well run and progressive — one of the best in what really is an antiquated system.
(In Montgomery County, we did in the recent past have a county recorder who just refused to come to work, but that’s a story for another time.)
In November, Cuyahoga County overwhelmingly passed Issue 6, which created this structure of government for the county:
• An 11-member council, with each officeholder elected by a district.
• A county executive elected by all voters in the county.
The plan abolishes the other county offices — except prosecutor — and puts financial and other functions into the hands of the county executive.
The goal of those who promoted the measure is to make county government work better and more efficiently. The ambition is also to help the county do a better job with economic development.
According to Ned Hill, Dean of the Levin College of Urban Affairs at Cleveland State University, the success of this change depends on how well county services are preserved, while lowering costs and creating “transparency.”
So why should we care about all of this?
• Our state clearly has a problem with its governments at the local level. Last week the Brookings Institution issued a report that argues that the state’s local government structure is bloated and costly.
• Area counties are under financial strain. In Montgomery County, a recent task force urged leaders to look at changing how the county is structured, given that the county isn’t growing and the current arrangement is becoming unaffordable.
• Also, there has been occasional talk of the possibility of merging the City of Dayton with Montgomery County — a consolidation modeled after such a change in Louisville, Ky.
Before we consider something like that, we ought to ask: “What problem are we trying to solve?”
Cuyahoga County’s plan is no panacea. We’ll have to decide what kind of change we want and are willing to make happen.
While changing county government might be a start, in Cuyahoga County, there will still be major issues between the City of Cleveland and the dozens of other cities in the county. Counties also have constrained roles under Ohio’s constitution.
And in our region, we have a struggle and rivalries between counties, as Greene County demonstrated by its recent decision to sharply cut its support of the region’s Dayton Development Coalition.
Reforming a county government won’t change that kind of problem.
But we should keep an eye on Cuyahoga County. At some point, our region is likely to have to make changes. And we shouldn’t wait for a crisis.
