'Next economy' requires public-private sector alignment, intentional investments
Image courtesy of the Brookings Institution
This map shows the 50 U.S. metros analyzed for the Brookings Institution's Global MetroMonitor.
In December, I often get so bogged down in holiday to-do lists and year-end deadlines that the New Year – and its fresh ideas and resolve to do better – can seem far off in the distance. But at last week’s “Global Metro Summit: Delivering the Next Economy,” hosted at the University of Illinois Chicago, I received a fresh injection of inspiration, thanks to stellar keynote addresses, panel discussions, and conversations, presented by the Brookings Institution, London School of Economics, Alfred Herrhausen Society, and Time magazine.
The conference focused on how to get to the “next economy,” defined by Bruce Katz, founding director of Brookings’ Metropolitan Policy Program, as metropolitan-based, innovation-fueled, export-driven, and low-carbon. (Watch Katz’s presentation here.) Hundreds of government officials, policy advocates, business leaders, and academics from Chicago and around the world attended, including strong representation from MPC’s staff, Board and committees. (For an informed perspective on the summit, read MPC Board of Governor member Jacques Gordon’s blog post.
I have pages of notes – enough inspiration for this blog post, a column for Citiwire.net, and initiatives to come.
What I want to focus on here is a theme I heard over and over at the summit: To grow our economy, the public and private sectors must align plans and resources, then invest with intention.
From my vantage point, we can’t allow our many assets or some impressive rankings lull us into complacency. We have much work to do in metropolitan Chicago to unlock our growth potential in the next economy.
First, we need a relentlessly focused “cut and invest” strategy at all levels of government; yes, that means simultaneously tightening their belts and sharpening their investment decisions. In Northeastern Illinois and Northwest Indiana, elected officials and candidates for office – including mayor of Chicago – will confront historic budget deficits in 2011. MPC supports the Civic Committee’s Illinois is Broke campaign, which details the changes needed to return Illinois and its communities to sound financial footing. And MPC’s 2011 Plan for Prosperity, which will be available in January, outlines a number of recommendations for regional, state and federal policy reforms that will make more efficient and purposeful use of our limited resources – so that we can live well, while living within our means.
Yet, as Katz pointed out in his address, “Americans understand we can’t cut our way to growth.” Neither will willy-nilly investments get us where we want to go. Instead, we must invest with intention, and to do that, we need government and business in alignment. In addition to authorizing tools to prioritize our resources, government must partner with the business community to identify and, together, make targeted, transformative investments in high-growth economic sectors. In our region, those sectors could be green manufacturing, transportation logistics, food processing, and technology.
Though coordinated investment is not nearly as widespread as it needs to be, our region offers glimmers of success that can point us in the right direction. For instance, the Cluster Acceleration Program (CAP), a project of the Chicagoland Entrepreneurial Center, is helping entrepreneurs tap venture capital and marketing to strengthen key economic sectors, namely alternative energy, consumer products and services, and information technology for the new media, financial services and healthcare markets. Seeded through ARRA by a two-year grant from the U.S. Dept. of Commerce, Economic Development Administration (EDA), the program is a strong example of how the public and private sectors can work in tandem to build the next economy.
With both sectors at the same table, we can make public funding go further. That’s why when I was asked to serve on Gov. Quinn’s Elgin-O’Hare/Western Bypass task force, I recommended adding more business voices to the finance committee. These industry leaders can inform the public sector’s approach and, in turn, learn about opportunities to invest in some of our region’s huge infrastructure projects and receive a fair return on investment.
And oh, one more thing: We must be brave. That means everyone must be willing to share in risks, responsibilities – and rewards. It also means less boosterism and more reality: Northeastern Illinois and Northwest Indiana are doing some things right. For instance, we’re fostering municipal collaboration to be more efficient and targeted with limited resources, and exploring ways to invest smarter and get more from existing infrastructure, such as congestion pricing. Yet, while progress is being made, more work is needed to achieve total alignment.
And we cannot wait years for these reforms. The following statistic hit me like a punch in the stomach: According to Katz, “The locus of economic power in the world is shifting. The top 30 metro performers today are almost exclusively located in Asia and Latin America. The 30 worst metro performers are nearly all located in Europe and the United States.”
I share this sobering statistic not to exacerbate the winter doldrums, but to set the stage for encouragement from Katz, whose words are fresh motivation jump on the agenda for 2011:
“The people in this room embody the energy and potential of metro America. I urge you to leave here today and act with purpose.
“Set a vision for growth that is intentional. Align federal, state, private and philanthropic actions to that vision. Organize and use your political muscle to drive systemic reforms and transformative investments.
“I challenge you in short to act like a pragmatic caucus … across sectors and disciplines and jurisdictions and political parties.
“If you do these things, jobs will follow, investment will flow, and innovation will spread like wildfire across the nation.
“You are the distinctive, grounded voice in the coming debate over jobs and taxes and economy and investment.
“Let that voice be heard, through innovation, action and advocacy.”