Tag Archives: economic development

Results from WDET’s “Detroit Move” Survey

WDET conducted a survey last month centered around the question, ‘What would it take you to move to the city of Detroit?’ The station’s analysis of the results of that survey have been out for several weeks now, so I figured it was well past time for me to post on them.

The response far exceeded the expectations of WDET’s staff:

We set a goal of 1,000 responses in seven days. We met that goal in 48 hours, over the course of a weekend. A total of 2,200 respondents were collected at the end of the week, making this the largest known data set of it’s kind.

It’s so rare to see quantitative data on people’s attitudes about moving to Detroit, which up til now have mostly been captured in a jumble of conflicting anecdote.  As the introduction to the summary notes,

The latest iteration of the persistent “Detroit authenticity/Detroit love”  battle shows little evidence of the participants actually engaging with the arguments/ ideas of  the other side. Instead, there is a lot of interaction with existing beliefs, misremembered history,  convenient reformulations of the past and a willful disregard for “live and let live” acceptance.

WDET wisely engaged the services of a social scientist, a PhD candidate at Brandeis named  Sara Elliott, to help design the survey.  The survey questions they developed were concrete and specific, and admirably, Elliott and her collaborators at the station steered clear of extrapolating too much from the results.

Still, when ’84% of city residents said they would be unlikely to move to the suburbs in the future,’ I suggest we’re a bit closer to guessing why, in spite of the conventional wisdom that Detroit is a dying city, over 700,000 residents remain.  Those who survived the exodus of the 2000s are a resilient bunch and have compelling reasons to stay.

Another interesting data point pertains to how Tree Towners and other Washtenaw residents view the city:

Paradoxically, a smaller percentage of survey takers were from Washtenaw County and this group comes to Detroit less frequently than those living in Wayne or Macomb counties, yet this group was the most likely to say they would be likely or very likely to move to the city in the future (50%). The next largest group of respondents who said they would be likely or very likely to move to the city in the future lived in a county other than Macomb, Oakland, Washtenaw and Wayne (outside Metro Detroit) (42%). Smaller percentages of survey takers from Wayne (35%) or Macomb (34%) counties and Oakland County (31%) said they would be likely or very likely to move to Detroit. The largest group of survey takers was from Oakland County, but they were least likely to say they would move to the city in the future.

Responses to the statement ‘I would support a friend or family member’s decision to move to the city of Detroit’ were more positive than I’d have expected:

There is data to back up an observation that I’ve seen made frequently (and have made myself), which is that younger people view the city in a more positive light than older generations:

Over half (55%) of those under 25 years of age said they would be “likely or very likely” to move to the city in the future, compared to one third (36%) of those 26-45 and one-quarter (24%) of those 45 and above. As age increases, likelihood of moving to the city decreases significantly.

And there are some clues for whoever ends up in charge of the city as to what priorities they should focus on:

A few factors stood out as mattering to more of the respondents who said they were likely or very likely to move to the city in the future…

  • Better city services (57% of likely movers compared to 51% of unlikely movers)
  • Better public transportation (60% of likely movers compared to 36% of unlikely movers; this factor rises past lower crime to the #1 issue among the very likely subset respondents) 
  • Increase walkability (53% of likely movers compared to 41% of unlikely movers)

Note the walkability figure;  in spite of pockets like Greektown, Midtown, Corktown and Mexicantown (basically any neighborhood ending in ‘-town’), Detroit lags many of its suburbs in that respect.  Also, the most likely recruits appear to be swayed more by service provision (including both schools and transit) than by “lower taxes” or “better jobs” which are way down the list.

Surprisingly, I haven’t seen reaction to the survey from Detroit’s other media outlets such as the Free Press or the Metro Times.  Perhaps they were embarassed they didn’t think of it first.

For more, check out the summary of the survey results (PDF).

Squelching

I trash Richard Florida a lot on this blog, but I like a passage from his column this week at the Atlantic:

Jane Jacobs identified almost exactly the same dynamic when I asked her some years ago why only a handful of places pioneer innovations and unleash the creativity of their residents, while most are content to sputter along, stagnate, and even die. “Each and every community,” she told me, “is filled with lots and lots of creative and innovative people.” The trouble is with a small core of people she dubbed “Squelchers,” who are instinctively opposed to doing anything new or different. Unfortunately, these people are often a town’s business and political leaders. You’ve probably seen them in action; maybe you’ve even bumped up against them yourself.

Only a handful of places are endowed not only with a great research university, but a culture that tolerates and actively encourages risk-taking.

Florida gives Tree Town a shout out, noting, “There are cities in the once-dying Frostbelt — such as Ann Arbor, Madison, and even Pittsburgh — that have built new knowledge and creative economies around their great universities.”

I think this is important because, from the view on the ground here, Ann Arbor is full of squelchers.   Most of our area’s success stems from the constant influx of brilliant people coming in from all over the world to work and study at the U.  But they are counterbalanced by a vocal segment of long-time residents who fear the city’s increasing density and congestion, and a micromanaging city bureaucracy that attempts to regulate everything within its grasp.  Recent examples abound, such as the planning advisory committee that failed to relax the city’s restrictions on multi-family dwellings, or the zoning that prevented a small business from expanding the range of merchandise it sells, to cite two.

There’s been a lot of discussion in the urbanist blogosphere recently on the role of community input on planning and development, catalyzed, I think, by Ryan Avent‘s The Gated City (which I will eventually get around to reading and posting about).  Alon Levy has had a couple of excellent posts on the topic.   Mary Newsom summarized the key question with particular succinctness:

(W)hat if the public really doesn’t want any development at all? A survey from The Saint Index found that 79 percent of Americans said their hometown is fine the way it is or already over-developed. Some 86 percent of suburban Americans don’t want new development in their community. The anti-development sentiment is the highest in six years of Saint Index surveys.

So if you try to involve the community and listen to what they want, do you end up with a plan that forbids growth? How smart is that? Should planners heed community wishes, even if they know what the community wants is impossible or imprudent?…

The challenge for planners, it seems, is first to educate people on the repercussions of their choices and then, to show them choices for other ways to develop: tree-lined urban streets, with shops and shop windows on the sidewalks, to choose one example. But the planners can’t stop there. Step Three has to be to make sure the supporting ordinances and standards require the good and disallow the bad.

Having seen the effects of Detroit’s sclerosis on that city, I am vigilant for the signs of similar sclerosis that are emerging in Ann Arbor.  Indeed, while it suffers from its own inertia in many ways, I see Detroit benefiting from an increasing sense of adventure, flexibility and openness among its residents in terms of land use and planning — attitudes lacking in Ann Arbor.  Channeling community activism and local governance in a positive and productive direction, away from the reflexive squelching that increasingly prevails, will be one of the great challenges facing Ann Arbor in the 21st century.

4 reasons to vote Bob Ficano out of office

Wayne County Executive Bob Ficano has got a lot of unwelcome publicity in the past week due to the enormous hole he dug for himself with the Turkia Mullin scandal.  (If you’re not local, or otherwise need to get caught up to speed on how Mrs. Mullin snagged herself a nice windfall courtesy of Wayne County taxpayers, let me steer you to the Detroit Free Press’ coverage & Jack Lessenberry’s op-ed on the scandal.)

Having read Oakland County Executive L. Brooks Patterson the riot act on this blog on more than one occasion, I figure it only fair to call out Mr. Ficano.  And this isn’t the only reason why Wayne County voters ought to replace him.  Let me recount some others:

1. First of all, it appears the Mullin case is only one of a number of other questionable cases involving separation payments to former Wayne County employees under Mr. Ficano.  For further detail, check out Sandra Svoboda’s story in this week’s Metro Times.

2.  These generous payments to Ficano appointees have taken place at the same time that Mr. Ficano has been laying off and instituting furlough days for rank and file county employees.  I’m not terribly sympathetic to public sector unions, but they have every right to be outraged that Ficano’s appointees are getting lavish payouts when they are being asked to sacrifice.

3.  The Aerotropolis.  Mr. Ficano ‘s been hawking the I-94-centered Aerotropolis for years.   From what I’ve read of the aerotropolis, a concept aggressively marketed by its originators John Kasarda & Greg Lindsay, it seems like a half-baked idea with little evidence that it generates the type of metropolitan economic growth its supporters claim it can.  (See the New York Times review of Kasarda & Lindsay’s book for a more detailed and nuanced discussion on this topic.)

Mr. Ficano’s embrace of the Aerotropolis is part of a bigger problem:

4.  A misguided sense of economic policy, which he shares with former Governor Granholm.  One thing I do appreciate about L. Brooks is his refreshing bluntness.  His initial reaction to state tax incentives for the Aerotropolis was to call them “another example of the never-ending torrent of legislative bullshit out of Wayne County.”  L. Brooks ended up coming around to Ficano’s side on the issue, but I think he was onto something with that characterization.   I think giving tax breaks to businesses to locate in the area around the airport, just because Mr. Ficano got sold on the Aerotropolis idea, is a lousy idea that only contributes to a race to the fiscal bottom between state and local governments.

It’s not just that Ficano has embraced special tax cuts on this particular pet project:  it’s that they seem to be his economic development tool of choice.  A 2009 quote says it all:

“If you’re going to consolidate anywhere in the world, you can now come here, because you are going to get tremendous tax breaks,” Ficano said at the time.

This is not a visionary long-term economic development policy.   Just because it is (sadly) popular among state and local officials across the country does not mean it is smart, appropriate, or good for metro Detroit.  Unlike Governor Snyder, who has waged war on tax incentives, Mr. Ficano has not yet recognized this.

Metro Detroit more than ever needs the best leadership it can get.  Sadly, between Mayor Bing and Mr. Ficano, it’s still not getting it.  Hopefully this will be the straw that breaks the voter’s back and leads to shakeups in the next elections.

Detroit’s pockets of promise: news from Corktown & Downtown

Having spent the past couple of weeks wallowing in cynicism and negativity on this blog, I thought it was long overdue to highlight the many recent developments worthy of celebration in the city of Detroit.

Here are just a few:

Those Corktowners are persistent.  Mercury Coffee Bar didn’t make it, but a couple of their former employees are trying again.  What’s impressive is how much mutual support seems to exist among businesses on this stretch of Michigan Avenue:

If all goes well, the coffee shop, just a few doors from the popular Slows Bar B Q, will be followed by seven other bars and restaurants slated to open between Sixth and 14th streets. They include a cocktail bar, burger joint and a coney island, and they’re all receiving support from the neighborhood and nearby businesses…

Astro, for example, salvaged wood for its interior from the corner pawn shop, and Phil Cooley, a Slows owner, helped with interior construction.

Landlord O’Connor Real Estate contributed by bringing the building up to standard codes, an often expensive proposition for new businesses.

Meanwhile, downtown seems to have become Dan Gilbert’s pet project.  Like the Ilitch family, he’s gone on a buying spree, but unlike the Ilitches he actually seems to be using most of his real estate acquisitions downtown for something besides parking.  A relocation incentive for Gilbert’s Quicken employees to move downtown, similar to the Live Midtown program, is in the works.

Downtown is also benefiting from Blue Cross Blue Shield’s decision to move its Southfield workforce there:

Blue Cross Blue Shield of Michigan has reached the halfway point of transferring 3,000 workers to downtown Detroit…(putting) the company on track to complete its goal of having 6,000 employees on its new downtown campus.

Since announcing the move nearly a year ago, BCBSM’s Detroit workforce has grown to more than 5,000.

Occupancy at the RenCen’s Tower 500 has gone from completely vacant to completely full.

And apparently the hotel market has recovered enough that investors are working to rehab the empty Whitney Building and convert it into a boutique hotel:

Metro Detroit’s hotels had their busiest May in more than a decade with an occupancy rate of 61.4 percent, according to STR. The last time May’s occupancy rate was higher was in the dot.com boom days of 2000, when it hit 68 percent, according to STR.

The region’s occupancy rate averaged 55.8 percent through the first five months of the year, the best showing in four years.

Lastly, I recently discovered Detroit LISC’s blog.  I was impressed with their post about “The importance of neighborhood marketing,” so much so that I thought it worthwhile to share the following lengthy excerpt.  LISC Communications Program Officer Ulises Silva describes a panel discussion he attended in May, and some strategies for successfully showcasing what’s best about your neighborhood :

The panelists at the symposium discussed the importance of building “neighborhood confidence,” and of the things neighborhoods and supporting CDCs can start doing in order to generate some positive buzz about Detroit neighborhoods. This can be through social media, traditional print publications, or any other grassroots marketing campaign that aims to attract residents.

Here are some of their suggestions.

“Maximize what’s hot.” Even if a neighborhood is in transition, emphasize the things that arehappening. Whether it’s a new storefront, community art, or a rehabbed home, emphasize the positive elements.
Emphasize the “lifestyle opportunities.” Is there something about your neighborhood that might appeal to different segments of the population? Are your streets bike-friendly? Are there eclectic hangout spots that artists might dig? Are there parks nearby that families might enjoy? Then mention those.
Testimonials matter! One panelist gave this great example: if we see a dingy, scary-looking restaurant, we probably wouldn’t want to go in. But if we read stirring testimonials about its great food, then we would probably give it a try. It’s the same with neighborhood marketing. Make sure to get the positive stories out so that prospective residents knows there’s more to your neighborhood than the occasional foreclosed home. Think of it as Yelping for your community!
Ask prospective residents about what they like and don’t like about your neighborhood…Take the time to talk to people. Their insights might prove more helpful than any faceless market research study in attracting new residents.
…BUT make sure you understand what they mean! One panelist offered another great example: when prospective residents were asked why they wouldn’t move into a neighborhood, “safety” was a common response. Everyone assumed they meant crime; in fact, they were referring to the area’s speed limits, and how unsafe they would be for children playing in the streets…  Don’t make assumptions about why people won’t move into your neighborhoods.
…(W)hile each city and each neighborhood will require different approaches to the same problem, one thing we all need is some creativity. Because it’ll take some creative thought to not only create grassroots marketing campaigns, but to fund them—or make them happen with little or no money. Thankfully, social media is the great equalizer in modern-day marketing: it’s vital, expansive, and free! If you’re a CDC or a neighborhood organization, make sure you’re on Facebook…

One panelist said it best: “The only thing that won’t work is doing nothing.”

You can like Detroit LISC on Facebook.

In other news:  We had a nice turnout of about seven people at our first ever Ann Arbor Blogger Meet-Up last Friday at the Heidelberg.  Bloggers from Damn Arbor, Michigan Exposures, and Great Lakes Guru joined us for lots of tasty and affordable German beer, and equally scintillating conversation.  Those who missed it, take heart:  we hope to repeat the experience this fall.

I’ve been very remiss in blogging recently, and it’s going to get worse before it gets better.  Expect very light posting next week, when I’m on vacation, and the week after, when I’ll be playing catch-up at work.

“Huh? What plan?”: Detroit & HUD’s “Strong Cities, Strong Communities” initiative

When U.S. Secretary of Housing & Urban Development Shaun Donavan announced he was deploying mid-career agency staffers to work in Detroit’s city government, my first reaction was to ask:  How exactly is this going to help anything?   HUD can’t even manage its own programs properly, let alone entire troubled cities.

The Detroit News‘ Deb Price and Karen Bouffard quote “a congressional source“The idea seems to be that by having federal officials on the ground in Detroit and other cities that they can make federal services and initiatives at work in the cities more coordinated, effective and efficient…”  They acknowledge, with a wryly diplomatic understatement, “Spending federal money quickly and effectively has been a problem for Detroit.”

In response to the announcement, a column by Daniel Howes showcases one of of the catchier headlines I’ve seen from the News –”Feds come to Detroit, forget to bring jobs.”  Catchy, but unfortunate, I thought:  Was Howes falling prey to the same mentality that has kept metro Detroit in the economic gutter, that somebody else is responsible for “bringing jobs to us” rather than our taking responsibility for creating our own?  Fortunately, the title turned out to be misleading.  But like mine, Howes’ initial reaction is highly sceptical:

(T)he feds intend to answer government failure in Detroit with more government…

If you want to help Detroit, Mr. Secretary, I’d suggest focusing on policies that stabilize taxes, regulation and the creep of government control; policies that encourage the engine of Michigan’s economy to keep turning and keep responding to the market, not mandates; policies that make it easier, not harder, for business to reinvest in Detroit, to capitalize on its comparatively cheap commercial real estate and labor costs… But the description of how the feds plan to help these “pilot” cities, detailed at www.whitehouse.gov/blog/2011/07/11/announcing-strong-cities-strong-communities, sounds eerily reminiscent of former Gov. Jennifer Granholm’s feel-good-but-do-nothing “Cool Cities” program.

Unfortunately, Howes’ prescription is as short on specifics as the press release he criticizes.

Meanwhile over at the Free Press, Tom Walsh is feeling cynical, too:

(W)hen Donovan said Detroit was picked as one of six cities to pilot HUD’s new Strong Cities, Strong Communities initiative “because they have a plan in place,” here’s what I thought: Huh? What plan?..

(R)esidents of Detroit have been teased for years with grand concepts for both neighborhood revitalization and transit, with nothing to show for it…

The best way to think about this initiative is that it provides a very diplomatic backdoor way for the Obama administration to make sure federal funds are all accounted for, and that they get spent properly and on time;  put another way, to do what the Bing administration is supposed to do but is incapable of, which is to get these departments to quit wasting precious federal money.

That is the best case scenario, and we shouldn’t expect anything from these federal implants beyond this.  They are not going to magically ensure service delivery improves, or return the city to solvency, or foster a more productive and positive work ethic among city employees, or get city officials to start thinking outside the box, or in any way make the city friendlier to business owners.

My main worry is that we’ll see them go native and get captured by the bureaucrats in the departments they’re assigned to, like Sheryl Robinson Wood.  I would not be shocked if we see that scenario repeated a couple of times over before this project ends.  The city government of Detroit is a black hole for good intentions.

Lest I be accused of naysaying and negativity, like when I pissed people off for seeming to write off urban farming, let me note I would love to be proven wrong.  And, of course, it’s very kind of the Obama administration to try to do what it can for Detroit.  It’s the thought that counts, right?

“Where are you going to find 100,000 square feet?”

AnnArbor.com’s Paula Gardner describes a problem most Michigan cities would love to have:

It’s easy to celebrate upon hearing the assertion from Barracuda Networks that it wants to hire up to 500 new employees and acquire or build a 100,000-square-foot office in downtown Ann Arbor…

But it also begs the question posed by developer Ed Shaffran: “Where are you going to find 100,000 square feet?”

AnnArbor.com reader Bernie P. had an idea:

Brownfield @ Broadway / Maiden Lane – COULD BE purpose built for a Barracuda campus to hold 500 people with parking, shopping, etc, etc.

Bonus is that it is within walking distance of AATA stops from the park & ride at Plymouth / US23.

As I already wrote in response to his comment:  I could not agree more.

Before I moved out near Arborland, I lived off Maiden Lane on the north side right next to the huge abandoned brownfield at the corner of Broadway and Maiden Lane.  Surrounded by chain link fence, the property has reverted to prairie and looks like something you’d see in Detroit, not Ann Arbor.

Lower Town is probably the most blighted part of Ann Arbor.  The student ghetto is blighted too, but at least has a high population density;  Lower Town, largely divided between unkempt university parking lots and the property I’m writing about, just feels empty.  It’s a puzzling failure of land use, since it includes ample parkland along the Huron River and sits in the heart of the city, smack in between the prime real estate of Kerrytown and the University’s sprawling North Campus.

As I noted in my comment responding to Bernie P., the site has a number of advantages for a corporate campus of some size.   It would presumably be much cheaper than downtown real estate, while offering access to the river and, as he noted, AATA’s #2 bus.  The biggest problem would probably be opposition from homeowners on Broadway, but steps could be taken to minimize adverse impacts on their neighborhood.  And the most immediate neighbors on the other three sides of the site are either commercial, rental housing, or university parking.   It’s not quite as glamorous as downtown, but certainly better than developing on the city’s outskirts.   And providing space for employee parking would be infinitely easier than downtown.

Am I missing something?  Anybody know why this site has been idle for so long, besides the lousy real estate market?

Food carts in Ann Arbor!

When I went to South by Southwest in March I gushed about Austin’s plethora of tasty food carts.  Well, people in  Ann Arbor must have heard about how awesome Austin’s food carts are — because tomorrow, a collection of food carts debuts here:

The brainchild of Downtown Home & Garden owner Mark Hodesh, Mark’s Carts will include seven individually owned and operated food carts and will be located in a fenced area off of West Washington Street between South First Street and South Ashley Street, behind Hodesh’s store. Hodesh plans to eventually have 10 carts…

Hodesh said he doesn’t expect all seven to be up and running until later next week.

While cart operators will set their own hours, Mark’s Cart will be open from 8 a.m. to 10 p.m. daily.

Hodesh said he continues to look for more cart operators. He’s currently considering two Indian food applications and is hoping for wood fired pizza and perhaps Jamaican food. “But I’m open to anyone with an interesting food idea,” he said. Applications for a cart and more information on Mark’s Carts can be found on-line at http://www.markscartsa2.com.

The seven carts include:

Darcy’s Cart, featuring locally sourced food such as a breakfast burrito and short rib kimchi tacos.

Debajo del Sol, Spanish food with paellas and tapas, including house-made chorizo corn dogs.

eat, with a menu that features locally sourced sliders.

Humble Hogs, a food cart operation from the Houston area, moving to Ann Arbor to feature headcheese hoagies, pork-n-beans and more.

The Lunch Room, a vegan menu that will include curry roasted potatoes and summer rolls with peanut sauce.

People’s Pierogi, with homemade pierogi with traditional fillings such as potato and cheese and with experimental fillings.

San Street, with Asian street food.

I plan to check it out, if not tomorrow night, sometime this week.   The carts would seem to provide a low-cost way for Ann Arbor’s culinary entrepreneurs to bring their product to market, without the stiff overhead of downtown rents, so I’m hoping this will prompt an explosion of similar carts across downtown and Central Campus.  I could really use a few near where I work at the Medical Campus, which is a bit starved for variety when it comes to food options within short walking distance.

The recovery in Southeast Michigan

http://www.urbanophile.com/2011/09/14/2010-gdp-data-shows-nascent-recovery-in-many-american-metros/  Metro Detroit & Ann Arbor both in 4th (2nd-best performing) quintile, Lansing metro in top quintile for 2020 GDP growth —  ahead of Chicago, any of the big metros in Ohio, Milwaukee, Madison, & on par with the Twin Cities & Indianapolis.

Things are picking up, according to the Bureau of the Labour Statistics.  Of all U.S. metro areas,

Detroit-Warren-Livonia, Mich., experienced the largest unemployment rate decrease from March 2010 (-3.3 percentage points)…
In March 2011, Detroit-Livonia-Dearborn, Mich., registered the highest jobless rate among the divisions, 12.7 percent… (But t)he two divisions that make up the Detroit-Warren-Livonia, Mich., metropolitan area posted the largest rate declines from a year earlier: Warren-Troy-Farmington Hills and Detroit-Livonia-Dearborn (-3.4 and -3.3 percentage points, respectively).

West Michigan does even better, with the Grand Rapids, Holland, and Benton Harbor-St Joseph metros all rapidly improving their jobs rankings. (HT BurghDiaspora)

Michigan’s film subsidies: Why I’m glad to see them gone

‘In less than a decade, the absurd notion of welfare for movie producers has evolved… to an unshakable American tradition…’ –Michael Kinsley, ‘Lights, camera, cut on Hollywood subsidies

As I’ve written before, there’s plenty to dispute in Governor Snyder’s FY 2012 budget.  But I’m tired of all the whining about at least one of his cuts:  the elimination of Michigan’s film subsidies.

What do I have against these particular “incentives,” as their supporters often euphemistically term them?  Let me start with the Craig Fahle Show on February 25, when Amy Miller interviewed James Hohman of the Mackinac Center.  Hohman explained that state subsidies are “not expanding the market for film, we’re just transferring wealth from one place to another instead of generating it,” that we’re taking taxpayer money and bribing an industry to move their work from one state to another.  As Amy noted, the industry has, as a consequence, become highly transient.  Jim Russell posted last month on BurghDiaspora about how they think they’re going to be the next Hollywood over in Pennsylvania, too.

But Michigan is special, right? If we just plant the seed and give it a couple of years, the industry will put down roots permanently, won’t it?  Michael Kinsley, in an early March 2011 article for Politico, explains that subsidizing films

essentially is a “beggar thy neighbor” strategy. Some of the movies that have been bribed to locate in New Mexico would have been made in New Mexico anyway… (M)obility giveth and mobility taketh away. Pit the states against one another, and the subsidies will inevitably become more generous and less effective at the same time…

As yet another observer, former Merrill Lynch entertainment industry analyst Harold Vogel, quoted by the Free Press at around the same time, puts it:

“It’s a false promise,” Vogel said. “The industry is notably mercenary. Any time it gets a better deal, they’ll be out of Michigan in the blink of an eye.”

And the studies that supporters have cited turn out to be garbage.  Kinsley again:

In the definitive document on this issue, a paper published in December by the Center for Budget and Policy Priorities, senior fellow Robert Tannenwald notes what he tactfully calls “flaws” in various studies the states have commissioned to justify the subsidy. Even after our recent experience with gullible or mendacious accountants in financial scandals such as Enron… it’s actually shocking that reputable firms like Ernst & Young would pull some of these stunts — such as counting the allowances film crews are paid for expenses as a benefit to the state and then counting the same money again when it is spent…

The really sad part is that our states aren’t just in a bidding war over film subsidies.  Midwestern policy guru Richard Longworth has written frequently about how the states themselves are an economic relic that now undercut the competitiveness of the Midwest’s metro regions.   Last week, he argued again for why tax credits for individual businesses are stupid policy, focusing in particular on the example of the Kansas City area, so eloquently and in such detail that I hope you will forgive my quoting it so extensively:

It’s precisely these states’ inability to compete globally that causes them to declare war on the folks next door.

In a global economy, Kansas and Missouri aren’t competing with each other, any more than Illinois, Indiana and Wisconsin are competing with each other. The real competition is 10,000 miles away and all Midwesterners know that we’re losing it. The region — not just the individual cities and states but the entire region — is losing companies, manufacturing, jobs, people, congressional seats and college grads, which means they’re losing the resources needed to compete in a global economy.

Clearly, what the Midwestern states are doing isn’t working. You’d think they’d do what the Europeans, Indians, Chinese and other competitors are doing, which is to form regional alliances to leverage all their strengths, to maximize their economies of scale, to merge their assets in to a single world-beating economy. On a global scale, Midwestern states are tiny: there are more than 30 Chinese cities with more people than there are in all of Kansas. But as a region, the Midwest has more than 60 million people which, even on a global scale, counts for something…

By mandate, they are geography-bound, forced to limit all thinking and action within their state lines. Any business they can steal from next door looks good to their voters, whether it makes sense or not…

One reason this doesn’t work is that poaching businesses involves giving tax breaks to the poachee. Right now, states aren’t spending on the future because they’re broke, and one reason they’re broke is that they’re giving away badly-needed tax money. The letter from the Kansas City businessmen made this point clearly:

“… The states are being pitted against each other and the only real winner is the business who is ‘incentive shopping’ to reduce costs. The losers are the taxpayers who must provide services to those who are not paying for them.”

Neither does this poaching usually create new jobs. Most of these cross-border raids, in Kansas-Missouri and in other states, involve companies just moving a few miles away across the state line — usually so close that their workforce changes not at all. People just commute in different directions. The overall impact on job totals, incomes and economic gain in the region itself is absolutely nil…

The state governments and governors, like Brownback, claim that these tax lures are necessary to draw in companies not from next door but from far-away states. If so, they aren’t working. A University of Illinois study showed that there are some 300 significant corporate relocations in the United States every year, and about 15,000 different economic development organizations — state, county and local — competing for them. In other words, the odds against success are fifty-to-one…

… State economic development officials tell me that the company, such as Honda or BMW, simply announces that it intends to set up a new assembly plant somewhere in the Midwest. Then the company just sits back and watches the states throw money at them, trying to outbid each other with tax holidays, free land, training subsidies and other lavish gifts.

All the states know this goes on. All know they could stop it in an instant by banding together and refusing to play the game…

Mark Drabenstott, in… Past Silos and Smokestacks, wrote that these recruiting incentives and other bribes account for no less than 80 percent of economic development budgets in the twelve Midwestern states. That leaves virtually no money left over for approaches that might really work.

Every economic development professional knows that this adds nothing to the Midwest’s long-term growth or its ability to compete globally with China and other rising nations. The only true solution is to create truly  new companies and industries by building them from the ground up  — by investing in local education, encouraging local entrepreneurs, setting up incubators, growing business services, increasing venture capital.

This is called economic gardening, and it works. It means working regionally. It means spending money, not giving it away in tax breaks. It means planting seeds now, knowing they won’t sprout until some other governor is in office.

Right now, Midwestern governors are competing not with China but with each other to see how much they can slash spending in the next few months while stealing jobs from the next state… And it’s useless.

Again, Longworth’s entire post is worth reading in full when you get the chance (and I encourage you to subscribe to his blog as well).

The good news is, like Michigan, the madness may be subsiding in other states as well.  According to the Detroit News:

In the last couple of years, New Jersey, Kentucky, Connecticut, Iowa, New Mexico and Kansas have all cut back film programs. Georgia, where producers of “Detroit 1-8-7″ originally planned to film, is considering ending its 20 percent rebate altogether. New Mexico lawmakers also are considering spreading out payments to more costly film productions over multiple years.

The bar for sanity has been set so low  in American public policy, I’ll take a little comfort wherever I can.  I like movies and want to see Michigan’s creative scene grow as much as anybody, but this year’s budget is a viciously zero-sum game.  I would much rather have my tax dollars plugging the massive holes in the education budget or local revenue-sharing, to cite two examples, than to some Hollywood producers who are shopping around for a handout.  Wouldn’t you?

Toni Griffin’s “Room for Debate” and the Detroit Works Project

The New York Times offered up one of its Room for Debate conversations to the hot topic of how Detroit and other shrinking cities should deal with their population loss.  Harvard professor and Detroit Works Project consultant Toni Griffin’s held the most interest to me, since she is the one actually having to deal with it on the ground.

Unfortunately, to me her prescriptions and analysis were vague general to the point of uselessness.  Detroit’s specific circumstances demand specific prescriptions.  Griffin’s were anything but specific, and were particularly disconnected from the actual political and socioeconomic circumstances of the Detroit region.  If you want clear, detailed insight on how Detroit should deal with its shrinkage, you’re not going to find it here.

My guess is that this was deliberate; she is intimately involved in the Bing administration’s plans, and while she may have her own ideas about what the city can and should be doing, she has to keep her mouth shut until the mayor decides it is time to announce the specifics of the plan.  In fact, I would bet she sat down and drafted this with the mayor’s office as a set of talking points with Detroit voters in mind.

If anything, it’s in keeping with the spirit of the whole Works Project to date, which has been citizen-engagement-as-kabuki.  I am OK with that — if a Detroit resident doesn’t like what the Project prescribes for her neighborhood, she has a number of options ranging from taking the city to court, organizing a recall effort, or just the well-trodden path of moving somewhere else.  I suspect the final details of the Project will inspire at least a little bit of each of these reactions.   The mayor’s job is to come up with a specific action plan that is both realistic and substantive; it is most emphatically not to make everyone happy.