Why Don’t We Have a Kauffman Foundation?

I was reading this article on Xconomy about their new partnership with the Kauffman Foundation, and the titular question immediately struck me: Why Don’t We Have a Kauffman Foundation?

Think about it: we are a center of innovation, but one of the most difficult places in the country to start and sustain a new business (see Indicator 13). And what do they focus on? Improving the success of entrepreneurship and commercialization!

Innovation

Wow, it must be Back to Basics Week at the ol’ Prosperity Blog. First “Regionalism,” then “Taxes” and now “Innovation.” I’m going to have to start my posts from now on with the old cheesy book report line, “Webster’s Dictionary defines innovation as…”

Here’s the thing about innovation. Innovation is like coolness. Everyone wants it, and the harder you try to get it, the more it slips through your fingers.

Celebrating Taxes and Economic Development

OK, I’m going to continue my modest proposal/rant from yesterday about getting everyone on board if we want to truly achieve our vision for a prosperous metropolitan region. I was at the Leadership Tomorrow Economy Day today, where the 80 young leaders spend a day learning about our region’s economy, and it was fascinating to listen in on the conversation.

Regionalism

I went to a really great discussion today at the University of Washington: remarks and a panel featuring Bruce Katz, the vice president and founding director of the Metropolitan Policy Program at the Brookings Institute in Washington, D.C.  Katz was in town to give a lecture on Tuesday night as part of the UW’s Danz Lecture Series, and he hung around Wednesday morning to do a more intimate session with a bunch of local bigwigs and leading regional thinkers (note: I am neither, but I got to go anyway).

Anyway, the discussion was really fascinating, centering on how the central Puget Sound can more successfully act as a region, and be an economic and policy leader for the country’s recovery and beyond. But, as Gene Duvernoy of the Cascade Land Conservancy – one of the panelists – pointed out, there was one big problem with the conversation.

Bring Back Griffey- and not for the reasons you think!

The brand, “Seattle” is a very strong global brand today, yet the brand, “Puget Sound” means little to anyone outside of the Vancouver to Portland corridor. When I talk to visiting delegations or travel (rarely) on business outside of the aforementioned corridor, I have to refer our region as the Metropolitan Seattle Region or risk blank stares and a constant drone of, “so, where are you from?” However, here at home I am very careful to refer to us as the Central Puget Sound Region for reasons primarily related to political correctness and job security.

It is worth remembering (and yes I’m ready for the hate mail from Everett and Redmond) that most people in the world think that Boeing and Microsoft are headquartered in Seattle.

The Sports Car of Innovation Speeds On

And the Puget Sound economy downshifts into high gear. Or something like that. I really need to learn car lingo.

Point being, I was just talking about the link between aerospace manufacturing, auto manufacturing and the knowledge economy of the region. And then Lamborghini makes a $1 million donation to support the school’s research into composite materials used to build both airplanes and high-performance cars.

Coincidence? Or the usual Prosperity Blog visionary economic policy analysis? You be the judge.

(BTW, because of the above linked article, I now come up in the top five when you google “Smartest Man Alive.” Awesome.)

What Will Alan Mulally Say at the Prosperity Partnership Luncheon?

So, like I mentioned, Ford Motor Company CEO Alan Mulally is going to be the keynote speaker at the Prosperity Partnership Fall Luncheon on November 13 (register now before it gets sold out!). And what’s even cooler is that he doesn’t do speeches, so it’s going to be town hall format; whatever people want him to talk about, he’ll just be riffing, like a mix between Phil Donahue and Drew Carey on Who’s Line Is It Anyway (ok, maybe not exactly like that). So, given that it’s open season, what is he going to talk about?

Rain Is Great! Come Here Because of the Rain!

It must be economic development awards season. Everyone is making their lists of top places for IT, biotech, innovation, business climate, etc. And along comes the Wall Street Journal with their Next Youth-Magnet Cities list. Guess what? We’re tops! Except for one thing: rain.

Who Writes The Headlines?

Talk about your buried ledes. Last week, the Governor and her staff met with the head of Boeing Commercial Airlines to present the “business case” (the comparable data on costs, quality of life, workforce, etc.) for why it makes the most financial and business sense that the second line of the 787 should be assembled here in Washington, and ideally in Everett. To be honest, the business case is probably second in importance for Boeing – behind the relationship with the Machinists’ Union and the stability of the labor situation – but it’s a good thing to make sure that management has all the facts.

Which is why it’s really surprising to me that the headline in the Seattle Times is “Boeing won’t get new incentives to add 787 line here.” Yes, it’s true that incentives aren’t discussed in the business case, but even the article acknowledges that “Boeing has repeatedly made clear this year that a key issue in the competition is its concern about the company’s poor relationship with the Machinists union and the number of strikes in recent years…”

Here are a few reasons why the “No Incentives” headline is surprising:

Consumption

And I’m not talking about the old timey name for tuberculosis. I’m using it in the “spending money to buy stuff” sense, although – at this point in our country’s economic history – we’re certainly coughing up jobs like a consumptive. A big part of all that job loss and economic contraction is that the average consumer isn’t spending anymore. Unless you are an average consumer with a low-gas mileage car, in which case, “Let’s spend like it’s 1999!” (Seriously, that was a big year for spending.)

The Next Five Years of Our Economy

So, when the Prosperity Partnership first formed and developed the Regional Economic Strategy, it was always meant as a five year plan. Or rather, not a five year plan in the control/command economy sense, but a five year strategy. We wanted to see what short-term, tangible things we could do to move the needle on increasing economic prosperity and job creation.

Great Recession aside, there have been some good successes, and we’re coming up on 2010 faster than I’d like to admit. I’ve been thinking for a while now about what’s next, and I’d love to get all those great economic development minds out there thinking about it. I’ve got three thoughts:

Time for a Fat Tax?

As I’ve said before, I really don’t know very much about the healthcare system. But you’ll note that I did say that:

As a side note, I do think that it’s our lifestyle, not just our healthcare system. We eat too much crap, don’t exercise enough and are a bunch of big fat fatties. I’m not sure cheaper health insurance is going to help that…it requires a culture change.

As usual, my brilliant observations are backed up by research. Apparently, “Americans who are 30 or more pounds over a healthy weight cost the country an estimated $147 billion in weight-related medical bills in 2008,” and half of that is straight from taxpayers through Medicare and Medicaid.

Let’s do some fun math. The healthcare reform bill is coming in around $1 trillion over 10 years, which averages out to $100 billion a year. According to the CDC, our country is collectively 4.6 billion pounds overweight. If everyone paid $25 for every pound they were overweight, that would pay for healthcare on its own! And since we know that a lot of the money is coming through other sources, like administrative savings, it’d be less than that. The brilliant part about it is that it creates an economic incentive to lose weight, which ipso facto lowers the cost of healthcare which therefore still evens out.

Now, obviously, this is a terrible idea for a number of reasons, including the disproportionate effect on lower income people who tend to be heavier because of lack of access to healthy food. But it makes you think. Consider this my finest Jonathan Swift post yet.

What’s the Difference Between a Propeller and a Wind Turbine?

They’re both fan-shaped things that push wind to create energy, just one uses it to generate propulsion, the other makes electricity. Only one can be used to get the bad guy during a fight with Indiana Jones, though.

So, of course it makes sense that former aerospace manufacturers are turning to wind turbines as a way to put their capacity to work. There’s actually two stories in between the lines here, though:

Have You Driven a Ford Lately?

I still can’t get over how cool it is that Ford Motor Company CEO Alan Mullaly is going to be the keynote speaker at the Prosperity Partnership Fall Luncheon on November 13.  But it’s not just the fact that he used to work in the region and now he’s in the Time 100. It’s that he can talk about a major national economic shift that has the potential to be huge in the central Puget Sound in two ways:

I Don’t Understand Health Care Reform

…as my recent Master of Public Health graduate wife knows well. It’s not that I don’t think that health is an important part of our economy, and I certainly believe that rising health care costs are a challenge for both government and employers (and everyone else). It’s just that I know that I don’t understand the health care system or healthcare economics enough to truly understand how to ensure that reforms actually improve health outcomes and lower costs. So when the government starts talking about whether Group Health is better than a publicly run insurance competitor, I find it hard to come down on one side or another. Kudos to Group Health, though, for being a national model.

As a side note, I do think that it’s our lifestyle, not just our healthcare system. We eat too much crap, don’t exercise enough and are a bunch of big fat fatties. I’m not sure cheaper health insurance is going to help that…it requires a culture change.