Cap and Trade Makes Industrial Recruitment Even Less Logical

I've long been convinced that industrial recruitment, that is a strategy that tried to grow our economy by convincing a factory to locate in an industrial park, is a losing strategy, generally speaking. There just aren't too many Toyota's lining up to locate here, and the companies within the United States, well, they're already American based and why should we use our tax dollars to steal them from another community? It just makes more sense to try to grow the economy overall than to fight the tide pulling these ventures south and east, to China and Mexico.

Soon, there may be yet another reason why industrial recruitment is a losing strategy: Carbon Cap and Trade. This will be a federally imposed tax on the production of CO2 emissions. Factories utilize large amounts of electricity generated by coal and other fossil fuels. Frequently, they burn their own fuels to make energy. In a day not too far into the future, the costs of doing this will increase. When it does, the costs of manufacturing will go up. Here's how CNBC's Larry Kudlow describes it: "[The coming] cap-and-trade program will be a huge across-the-board tax increase on blue-collar workers, including unionized workers. Industrial production is plunging, but new carbon taxes will prevent production from ever recovering. While the country wants more fuel and power, cap-and-trade will deliver less."

At this point I think it will be impossible to stop the cap and trade steamroller. From my standpoint, as a practitioner of economic development, I have to take the laws as they are, not necessarily as I would want them- and I do have reservations about cap and trade. So too do communities.

This means local communities have one more reason to think beyond their industrial recruitment dogmas and realize that entrepreneurship and improving small business efficiency makes more sense than adding onto your inventory of assets for a future factory that just ain't coming.

Tweaking Friedman

This article dittos the underlying premise behind one of Tom Friedman's recent provocative ideas about technology, entrpreneurship and innovation. A snip:

Government funds for the VC industry is simply unnecessary. At $30 billion per year, there is no lack of VC capital being deployed in America. The bottleneck in the VC-entrepreneurship equation isn't in the inputs of capital, it's in the outputs. The lack of exits and the dearth of the IPO market is what needs to be fixed to open the floodgates of innovation.

But then I thought - let's not go overboard with our criticism by taking Friedman literally. The guy's a huge fan of global entrepreneurship (I loved it when he referred to the worthy work of the global non-profit, Endeavor, as the "best anti-poverty program of all"). His heart and priorities are in the right place.

So before folks get up in arms about "bailing out VCs," let's take Friedman's comments figuratively. He's dead on when he points out that entrepreneurship is what is going to get us out of this mess. The government shouldn't focus on silly notions of VC subsidies that nobody wants. Instead, the policy agenda to foster entrepreneurship and the flow of capital to entrepreneurs is very clear.

The article goes on to talk about specific policy needs for America's tech based economy. I'd tweak Friedman a little differently by saying he's right on the underlying anti-poverty idea of entrepreneurship. But we need a stronger pro-entrepreneurship in general in America, not just one focused on tech companies. And the problem is about more than the current recession, we need more entrepreneurs for entirety of the forseeable future.

It'll take entrepreneurs to replace the factories lost to globalization, to find ways to reduce our carbon footprint within the coming regulatory framework, to make coal cleaner, to find new ways to use the next wave of the web, etc. Entrepreneurship is just a new app to be used to solve a particular problem. It should be part of our DNA in America.

Even Commies Support Entrepreneurship

Whatever happened to that "workers of the world unite" stuff?

Tran Quoc Thang is the Deputy Minister of Science and Technology for the (still Communist) Socialist Republic of Vietnam. Here’s what he had to say in a recent interview about Vietnamese scientists’ efforts to commercialize new tech:

In developed countries, about 15 to 20 per cent of products invented are invested in and brought to market. But in Viet Nam, only about 5 to 10 per cent of inventions make it out to society. However, the products that have been applied have brought back lots of benefit. For example, a high-tech group at Hoa Lac Hi-tech Park has applied its product to clean a lake in Ha Noi; another group successfully discovered medicine to treat a disease of lobsters, which greatly benefited fish farmers.

[…]

We don’t lack money. We just lack feasible projects. We have lots of people who got high rankings in international competitions in math, physics and chemistry but have problems in applying their research… Scientists must find out what the society needs and have the will of a businessman. If not, their research projects will be worthless or of less value. Money will be wasted without making a breakthrough.

We have defined four key fields in science and technology to focus on which are information technology, construction materials, biology and automation. As an agriculture-based country with a high volume of agricultural products, we can invest more in preserving technology and post-harvest processing. In the high-tech field such as new energy, clean energy and nanotechnology, the Government is very willing to support all feasible projects. Breakthroughs in these areas are very important for scientists and businessmen. This is because scientific and technological products eventually become goods in the marketplace. Once they become goods, they will be accepted in the society and bought. Thus, the scientists will have orders for research.

Source: http://vietnamnews.vnagency.com.vn/showarticle.php?num=01COM050109

EKU Offers Grad Level Course on Entrepreneurship in the New Economy

Great course offering from EKU: "If you are an entrepreneur, business owner, aspiring to create your own business, or working in an industry that requires entrepreneurial or innovative thinking and you currently hold a bachelor degree, EKU may have the perfect course for you. EKU is offering a graduate level course which focuses on entrepreneurship and innovation. If you would like to understand the ins-and-outs of entrepreneurship on a more intense level to help you gain a better understanding of business development concepts, then read further and contact: Jean Arthur at EKUMBA (jean.arthur@eku.edu)."

Here are some of the topics the class will cover:

The emphasis in the course will be on the role of innovation and creativity in the creation of new business enterprises, and in the management and marketing of new ideas, concepts, ventures and knowledge. The course will also include case discussions of business start-ups and exercises inside and outside of class to generate innovative business ideas.

The major project in this course will be the creation of a “business concept”. The business concept is a framework for a more extensive business plan that can be used to generate the interest of potential investors in your proposed business. It is somewhat less extensive than a full-scale business plan, but contains the same elements. This concept will be developed by each student, individually, or in a small group (2-3 students, max).

The course will cover the following topics. Some will be covered more in depth than others. Related topics can also be included, depending on the direction the class takes based on specific interests of students.

·The entrepreneurial mind –principles for creating a personal entrepreneurial strategy
·The entrepreneurial process - types of entrepreneurial ventures
·Idea generation, improving ideas, market opportunity analysis, new product promotion
·Methods for screening new venture opportunities
·Social entrepreneurship
·The business planning process - developing a business concept/plan
·Financing entrepreneurial ventures - obtaining debt capital
·Start-up & beyond – managing rapid growth, family e'ship, valuing a business, harvesting
·Intellectual rights - the patent and copyright process

This should be a class the KECI brings in house.