Monday, July 12, 2010

PS427: Technology Council pushes for 'bold action'

All the candidates for Governor are talking about creating jobs. The Wisconsin Technology Council has just released a report on policy changes needed to address the problem of encouraging the growth of high-tech jobs in the state.

The Journal Sentinel has the story:

Technology Council pushes for 'bold action' - JSOnline

And here is the link to the Council's full report:

Based on the report, what do you think is possible for the next governor to accomplish on this front? What problems might arise in adopting those policies?


  1. The two most feasible accomplishments for any incoming Wisconsin governor are the high-speed rail initiative and the Clean Energy Bills. Both have such an undeniable job-creating potential that would be nothing short of an economic shot-in-the-arm for Wisconsin.
    Unfortunately, both Republican candidates for governor maintain that they will try to get out of high-speed rail as soon as possible. Not only is this ridiculous, it's illegal, since federal dollars are already committed. Why any governor would want to avoid contributing hundreds of millions of dollars to get billions back in the state economy simply baffles me.
    The Clean Energy bill that failed this session needs to get passed soon. Never has this country seen such a devastating energy disaster as the Gulf of Mexico Oil Spill. It's a golden opportunity to ram through legislation focused on clean energy to create more jobs.
    Madison has taken a great proactive approach lately when it comes to job-creation. Construction projects, high-speed rail, and transitioning from Coal to Biofuel at the plant are great ways to get started and should be adopted by the state as a whole.

  2. I agree that one of the best things the state can do is follow through on the high speed rail. Not only would it create jobs and stimulate the economy, but it would be political suicide for anyone to actually turn down that money. I don’t believe voters would appreciate watching that money be snapped up by another state, and if Wisconsin doesn’t want it I’m sure there are plenty of places that would gladly take that large of an investment in their transportation system.

    A big issue that will have to be addressed is Wisconsin’s strong heritage of being a manufacturing and agriculture economy. Many people, especially in the rural areas, are proud of that heritage and believe they can continue in that direction. They will resist becoming a technological state, especially if investments and changes are concentrated in urban areas. The investments being made mostly in the metropolitan schools will be another indication that rural workers are not really being considered. Because it is obvious with the plant closings, such as Polaris in the north, that Wisconsin must redirect its economy it is important that the whole state be considered.

  3. According to the budget we took a look at for our weekly memo, there is approximately $7 million in biotechnology tax credits scheduled for FY 2010. Although not a huge amount, any attempt to spur innovation within Wisconsin is always certainly welcome. Tax credits such as these combined with the Clean Jobs legislation are vital steps in sustaining the economic future of the state. Rewarding innovation will do wonders for investment in the state and investors would be encouraged to be involved in the long term growth. In regards to the Clean Jobs Act, this would ensure that not only would jobs be created for future generations, but that Wisconsin could get closer to long term eco-sustainability. I am not sure if anybody has seen the recent commercials demanding Clean American Energy Now but basically they urge Congress to undertake the tools to ensure both our economic as well as environmental well-being. In regards to what Maureen stated, Wisconsin definitely has defining heritages. No doubt these heritages include a strong environmental one. From the progressive tradition of Fightin' Bob to the ecological work of Gaylord Nelson, Wisconsin has always valued keeping the environment in a pristine condition. Enacting the Clean Jobs Act would channel these convictions.

    The main obstacle to the aforementioned propositions is the initial spending needed to pay for the start-up of such programs. Especially in a time when spending increases are a big no-no, this would something hard to sell to the electorate. However, the long term benefits from passing such a bill would far exceed the initial capital costs. In fact, the Center for Climate Strategies estimates the state would receive nearly $4.9 billion between 2011 and 2025 and the legislation would create nearly 16,500 jobs. Numbers like this point to a strong future for the bill and for the state as well. As of now, balancing the budget is the primary concern but when the economy begins to pick up, the Clean Energy Jobs Act and more tax credits will almost certainly garner an awful lot of support.

  4. I agree with Dan, the construction of high speed rail will become the cornerstone of increasing the number of jobs. In addition to providing numerous jobs in the creation of the rail itself, the connection between Chicago and Minneapolis will be an indispensable resource for business. Providing a faster alternative to driving, and a less expensive route to flying. Such a speedy mode of transportation to could attract tons of business to the area. Back in the 1800s the same route was occupied by the 400 line (400 minutes from Chicago to Minneapolis) which is now a bike trail, it was vital to the growth of the midwest industry. I have no doubt that the creation of this modern resource will be absolutely essential.

    Clean energy jobs are a win-win. Production of resources of prevent the destruction of our planet, combined with creating lots would be fantastic. As Bryan mentioned while some money is being made available in the form of tax credits, the real problem is how to get this off the ground. The Obama administration has focused on creating green jobs as well. In a recent weekly address Obama talked only about creating green jobs. Maybe one possibility would be to try and secure some federal grants (just as with the high speed rail) to help make more money available.

  5. What is the record of high speed rail in this coutry? Is it not the case that even in the densely populated Boston to DC line that rail STILL runs a deficit? If rail requires subsidies even there, how can it possibly break even in our much less densely populated region?

    How far from the rail line would you have to live before it would still be quicker to drive or take the bus? Downtown Madison, sure. But Janesville? Would driving 40 minutes to Madison for the train be better thN just driving south or riding the bus?

    I can go round trip on the bus for under $30. What is the estimated price for the train?

    I believe the empirical answers to all these questions is in fact unfavorable to the train, but are seldom addressed by supportters or in these comments.

    So if you are a supporter, how would you defend the train even given these concerns? What benefits could the train provide that out weight see costs, including the possible need for long term subsidies.

  6. Good point Charles but I think it is important to consider not just the direct tangible benefits but other indirect costs that are alleviated from installing a high speed rail. Most notably, the environmental benefits from decreasing traffic would be a huge plus. The time benefit for consumers would also be an attractive option. With jobs being such a huge focus of both national and state politicians, the jobs created by the construction of such a line would be much needed. Although these would obviously temporary, training these workers to ensure they will be able to maintenance the line would help sustain long term job growth.
    Concerning several resources I have consulted, it seems that the Acela Express (high speed rail between Boston and DC) is operating with a profit, not a deficit. It also carries over 3 million passengers a year. I think the success of this track proves to be a great example for the rail between the Twin Cities and Chicago. Thoughts?

  7. The goals of the tech council are highly optimistic, yet lack in many areas. For instance, an area cannot simply create a silicon valley out of nothing, as there needs to be people involved in a commitment. The creation of a tech center at UWM is a good start; however, California is blessed with having CalTech, Stanford, and UC-Berkley for many of the great startups originate from. If possible the state should make it more open to foreign companies as well by offering tax incentives and easier access to entry into the United States by lobbying Congress for visa reform. The Wisconsin’s Act 255 investor tax credit program called “Acclerate Wisconsin” is a good start to increase investment into startups. I wish the article, though, would have gone into greater detail about retirement funds investing in risky venture capital. Further, the plan is smart to call for a redesign and modernization to the tax policies of Wisconsin. I also like the I-Q branding, though this plan will only work with a cohesive marketing effort from all those involved. Farm-shoring is a good start to adding jobs to rural areas that disparately need them. This will, nevertheless, not supplement the thousands of jobs lost in manufacturing.

    Further, Wisconsin would be smart to follow the farmshoring ideas of North Carolina, who won Apple over to build a billion dollar data center in rural North Carolina.
    In regards to energy, the state should be willing to explore nuclear energy given that a nuclear plant has not been built in the U.S. for nearly 30 years. High-speed rail is a great means to connect the areas in the I-Q corridor, however in the North East where Accela, a high-speed train, is vastly cheaper to take bus service and at times an airplane. Accela also fails since it must use the same tracks as the much slower cargo and the Accela only averages 79 MPH even though it is suppose to top out at around 115 MPH. Also, high-speed rail has only seen profit in two lines in the world: Paris to Nice and Tokyo to Osaka.

    All and all, I hope the government does consider some of the policies of the tech council; specifically about investing.

  8. The next Wisconsin governor has a lofty task of pursuing options to increase jobs and employment growth within the state. I agree with everyone who said that the Clean Energy Jobs Act is a win-win situation for the most part. However, as I have noted from the office I work in, it is (and will be) a difficult bill to pass. We received about a 50/50 response, for and against CEJA and it is something that is undeniably controversial within the legislature as well, but I suppose we will have to see what happens in the next congressional session.

    As far as high speed rail, it is a good idea in theory, but in reality it may just not be feasible. As Charles mentioned, the history of most high speed rail in the U.S. does point to a running deficit, which is what will most likely happen with this new high speed rail system. There are many benefits, but I'm doubting that those benefits will outweigh the costs, even in the long run.

    As the Tech Council noted, the Wisconsin economy and industry has changed and is continuing to change, so we need to be creative and innovative. I think that the efforts that UW-Milwaukee and Marquette are making towards water technology is great. The universities are sitting on a magnificent reservoir and they are using a natural resource to their advantage and for the betterment of the state. By bringing more businesses and new technological advancements through research, UWM's Great Lakes WATER Institute is making good headway for the state.

    It is additionally difficult to find ways of creating jobs in the short-term as well as make sure that we are able to sustain them for future generations. Not only do we need economic stability now, but it is important to make sure that our future citizens are taken care of as well.

    In the next session, I hope that Congress takes significant (and realistic) steps to improve high-tech job creation in the state of Wisconsin.

  9. At UW-Madison graduations that I have attended in both 2008 and 2009 it has been a part of the Chancellors speech to make note that this university is one of the leading research facilities in the U.S. if not the world receiving some excessive dollar amount. It is almost a tradition in this state as the Wisconsin Technology Council said to be ahead of the curve of innovation. The next governor of Wisconsin will have the task of not only creating new jobs, but doing so with technology development in mind as well as possible solutions to help boost our economy.

    The high speed rail, while Charles pointed out may be making costs out East who is to say exactly what the effects will be here in the Midwest. The rail will have many benefits not only by helping to create jobs here in the state, but also by helping the environment by reducing gasoline use and emissions. As mentioned earlier this rail will also help with business in general throughout the Midwest; time is money. Sure individuals can drive from Chicago to Madison to the Twin Cities, but the rail would cut down the time and increase efficiency. Not to mention is there is already federal money invested this is a change that is expected and should be embraced by the government.

  10. While the concerns about the light rail are valid, it should be pointed out that not all of those systems fail. The Hiawatha light rail in the Twin Cities is generally considered a big success. The ridership for the 5-year mark exceeded the projections for the 11-year goal. The maintenance from this amount of use has caused Metro Transit to hire more technicians and operators and the whole system is now undergoing major expansions to keep up with demand, which will also create jobs. The important part is to actually get the rail in place; there is always room to expand later, such as running lines from the suburbs and surrounding areas, to a central hub in the city. Not only that, but the light rail has gained major popularity and general support from the Twin Cities population. Many metropolitan areas even voted to increase property taxes to help extend the lines.

  11. I think that when a “technology council” meets like this, one thing to be cautious about is that ideas often sound much better than they really are. Our economy is, quite literally, limping through this year. The statistics are startling for our dairy state, 160,000 jobs lost, 3.4ths of which will never return! Gulp. These innovative ideas and increased incentives for entrepreneurs to bring jobs to Wisconsin is a great start and I do like the sound of this response. Instead of cowering in fear, it’s refreshing to hear that people are actually doing something to kick start the economy. However, while making the case that they do for, “bold action” it’s true that risk and bold decisions often are needed and pay off with extreme rewards. One of the challenges for our next governor is going to be to take these ideas and work with them. In the context of our financial times, bold and risk are two words that many investors want to stay far far away from. How do you convince investors to try something new when money is tight and hard to come by? I wish I had the answer.

    I think one of the best parts of this article is that Wisconsin is trying to bring in new, unprecedented jobs. Rather than rely on the same old sectors of our state’s economy (mostly agricultural) it’s important that we adapt and provide incentives for venture capitalists. One great idea that came to mind that I think can be modeled after is Wisconsin Film Incentives. With those not familiar with Wisconsin Film Incentive, it is basically a series of incentives for filmmakers to shoot films in Wisconsin. Some of the incentives include a 25% tax refund for investing in Wisconsin products and 0% sales tax for using Wisconsin machinery. You can check out the rest here. I think this would be a great layout for Wisconsin to use to foster more investment and jobs in Wisconsin.

  12. Also, Megan makes a great point that when it comes to time, time is money and that goes a long way in the business world. The environmental incentives are also very attractive when it comes to taking the train. However, business men and women who choose to take these high speed trains to work DAILY, also need flexibility. Will the trains offer enough trips so that when you must unexpectedly stay late, your not trapped without a ride back home? Also, will the train leave in a timely fashion and offer adequate parking so you do not waste time finding a spot and losing time? I think all of this has to be taken into account.

  13. I would also have to say that the high speed rail seems most feasible and would also be a valuable thing have in the state. I feel that it would bring in significant profit and it would help the state greatly. Obviously there will be many questions that will have to be answered but I believe it can be done. I also agree that the clean energy jobs act will do great things for the state. As for the creation of jobs we will need to find a way to create jobs that will last, not something that we can just use now to decrease unemployment and then it will be unknown in the future. If we bring more business to Wisconsin and do more, it will create more jobs, but there is always uncertainty as to what will be successful and what will not. I also agree that the UW-Milwaukee's Water Insitute is a great thing for the state.

  14. All of the proposals have good merits to them but in the end the unemployment that still remains unbearably high can really be helped by a switch from recession to growth in the business cycle. By seeing long term growth (made possible by state policies and private interests alike) the labor market will improve.


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