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2 Responses to “General Electric and a tale of two cities”

1. John Polk Says:
   November 29th, 2010 at 12:38 am

   Yet another example of what occurs when our erstwhile economic development establishment studiously ignores the assets we have in pursuit of some chimerical “magic bullets”…which will serve to develop the economies of the developers and transaction processors.

   It IS a wonder that the PD has awakened from its slumber to take note of the fact that Cleveland is “older, smaller, poorer,” despite the tens of millions of public and private dollars being funneled through our ever-metastasizing economic development organizational infrastructure.

   It remains to be seen whether the paper will be able/willing to “connect the dots” from a poorly-functioning economy to a corporate/political/organizational establishment which seems bent on re-creating mistakes made by other communities in betting on casinos and convention centers as analogs for economic development.

   Given the pass the paper issued to itself for missing the county corruption story for about 15 years (no mention of enabling the White Administration’s larceny, the Browns Stadium fiasco, and the role played by the business community in enabling the County’s banana republic model of governance), my guess is they’ll once again sidestep the big issues in favor of remaining on the best of terms with The Men Behind The Curtain…

2. Ed Morrison Says:
   December 1st, 2010 at 8:59 am

   While the Plain Dealer has started to right itself editorially (pun intended), my guess is that it’s too much to ask for the newspaper to become a leading voice in economic development. (If you want to see how a newspaper can play a very positive role in a city’s turnaround, look at the Milwaukee Journal Sentinel or the Dayton Daily News.)

   I expect that the PD is simply too weak financially to risk alienating the business community. Politicians are an easy target. They can only complain. (Do you recall Jimmy Dimora’s eloquent rant against Henry Gomez?) Business leaders can exert real financial pressure.

   The paper has clearly focused on sports as a way to try to build its readership and remain viable. The problem is, of course, that sports coverage delivers only a narrow demographic: aging white males. Sport coverage does not address an even deeper challenge with the loss of population in the region and the increasing pressure from electronic media.

   At the same time, of course, we have the business community willing to play that game of pressuring a newspaper for favorable coverage. This type of pressure is not unusual, but I have usually seen this dynamic in smaller cities with populations under 300,000. It’s a small town play.

   So, let us set our sights on some realistic goals. As long as the Plain Dealer exercises sufficient editorial independence to avoid becoming a bimbo cheerleader for some truly bad ideas, the paper is accomplishing something.

   Its coverage of the Med Mart barely passes this test. The paper’s reputation has been saved by some excellent commentary by Stephen Litt. But there has been no call for a full disclosure of the financial assumptions underlying the project. The lack of financial analysis behind this huge public commitment is, well, quite odd. Where is the PD on that one? Clearly in hiding.

   So be it. If this facility does get built, though, it will create a financial drag on the County’s budget for years to come. Perhaps the new County executive will step in. In the end, markets don’t lie.

   But the Med Mart was really never about capturing a market opportunity, clearly analyzed. It was about where to locate the convention center. Sam and Albert needed the facility to anchor Tower City and with a Med Mart, they thought they had a path to daylight. But Hagan had other ideas, and he rammed his version of the Med Mart through the County Commission. Now Hagan’s out. Tit for Tat.

   Albert and Sam finally got their Tower City anchor with a casino, but there’s a catch. They wrote a weird piece of property into the Ohio Constitution. (And we get our own vision of Pottersville, a casino on our Public Square.)

   It gets better. Today’s paper carries a story of how the casino project will be looking for an act of Congress to straighten the Cuyahoga River, all for the sake of better parking. If the business leadership gets behind this idea, there is yet another diversion of time, attention and resources from the real issues facing Cleveland. But history being what it’s been, we can expect the GCP to be lobbying hard Ohio’s new Senator to be a Champion for Cleveland and straighten out this river mess.

   All of this lurching from one project to the next underscores the lack of any coherent strategy for Cleveland. There is no strategic process or framework in place, and as a consequence economic development consists largely of the one project followed by another followed by another.

   Unfortunately, real estate development represents only a small spectrum of the full portfolio that a region needs to transform its economy. In the world of philanthropy, the foundations call for a “theory of change“, a logic model of how an investment will yield better outcomes. Sadly, there’s no logic model to Cleveland’s projects beyond a bald political dynamic of real estate developers leveraging public money.

   It’s the Big Thing theory of economic development, and it doesn’t work. If revitalizing a regional economy was as simple as building a shopping mall, a convention center, a casino, a Med Mart or even some downtown housing, don’t you think other cities would have figured this out by now?

   Regional economic transformation requires a complex portfolio of investments in people, businesses, places, branding and collaboration. It’s not simple; it’s complex. The successful cities — Oklahoma City, for example — figure out a unique, balanced formula for investment that links and leverages assets to define new opportunities. It’s a complex challenge of three dimensional chess, not a simple-minded game of checkers. The task is even more challenging because these complex investment initiatives must be designed and implemented in open, overlapping networks.

   That’s where the leading edge of metropolitan and regional development is right now. The good news is that in the past five years, a group of us at the Purdue Center for Regional Development have figured out how to manage this complexity with a light-weight, repeatable strategy process. This process is inspired by insights from open source software development. We have also been working on analytic tools to strengthen our focus on regional innovation.

   A growing number of universities — Purdue, Penn State, Arizona State, the University of Michigan, the University of Akron — are in the process of formalizing a national network to accelerate the adoption of these regional innovation models. Next week, we meet in Washington to take our collaboration to the next level.

   Until some segment of Cleveland’s business community figures out that Cleveland has lost a decade with all its self-absorbed real estate projects, we will continue to see more sideshows. I don’t expect the PD has either the editorial or financial muscle to change this dynamic. So, sit back, grab your popcorn, and enjoy the show.