Job killers are hurting Wisconsin

In general, politicians don’t know how to generate jobs. Most don’t understand how businesses operate. Some mean well, but they make decisions based on their beliefs of what business want. Often they put the public’s capital to work in weak industries or use these funds to reward supporters.

An exception was former Gov. Tommy Thompson who offered incentives and support to the printing and paper industries. These were growing businesses, and he helped them do what they were best at. Bravo!

More recently U.S. Tammy Baldwin put forth the Small Business Innovation Act of 2013 designed to get funding for growing job producing industries such as biotech and life science.

But Tommy and Tammy are exceptions.

Take a gander at what is happening now in Wisconsin.

One of the fastest growing industries we have is biotech. There is a shift from treatment (through drugs) to looking for causes, making faster and more rapid diagnostics of illnesses and treating them more creatively. One half of the $1 billion that the University of Wisconsin-Madison receives in research funding is for biotech.

Yet the recent $25 million allocated “venture capital” by the State excludes biotech. Instead the emphasis is on manufacturing, Ag information technology and medical devices. Note that employment in Ag and manufacturing has been declining for years. Productivity efficiencies have generated more output with fewer workers. They are yesterday’s job generators.

Now it is not unusual for politicians to look backward. Economists do it all the time. But if the purpose of government funding for venture capital is to generate jobs, then this ain’t the way…especially when the message you are giving the biotech industry is “we don’t want you here.”

Indeed if I was operating a biotech company, I would seriously consider moving to a state where science is not viewed through the lens of the flat earth society, where women’s reproductive rights are not stifled, and where government does not demean my employees. Is this my view as a private investor in the medical field? No, it is the opinion of at least three CEO’s of Wisconsin bio-tech companies who have complained to me about these antics. Want further proof: Check the number of stem cell scientists who have fled our state. Or review the recent Kaufman Foundation report that found that our state has the fourth lowest percent of residents involved in entrepreneurial activity. The Report also cited Wisconsin as having the second biggest decline in entrepreneurship in the last decade.

Job killers! Job killing policies.

Two other government problems stifle business. One is incompetent operated state government; the other is corrupt crony “capitalism.”

Gov. Scott Walker “spun out” the functions of the Department of Commerce to the Wisconsin Economic Development Corp. (WEDC). But an audit this year showed that WEDC failed to follow up on past due loans totaling millions of dollars and did not have a way to account for the jobs that these loans should have generated. This is fundamental in business. But is it when your appointees are political hacks?

Recently it was reported that a company that wanted to build in Wisconsin, gave up and went to Arkansas. Why? They couldn’t get their project through in more than a year; it took Arkansas three months.

Business folk need to believe (or have the “illusion”) that government will treat them on the merits of their requests and not because of political contributions or “connections.”

One further example of cronyism is the $500,000 single applicant grant given to a well-connected political group formed in January. Another might be the technical job given to a young man promoted over qualified Republican candidates. The young man’s qualifications centered on the fact that he was the son of a lobbyist!

Another example is the forced resignation Florida’s Education Chief. In Indiana he “raised” the grade for Christel House from a C to an A. The owner of Christel House was a major political contributor. Their grade determined funding for the school.

I could go on with examples, but you get the point.

If you are in business, you need to feel that integrity and honesty count and that the merits of a case are important. You do not get that sense in dealing working with Madison. Cynics will say that it has always been this way, but they would be wrong.

We need fairness and honesty and a practical approach to generating good-paying jobs for our citizens.

Bob Chernow is a Milwaukee businessman, vice chair of the 11,000 member World Future Society, former chair of the Milwaukee River Non-Pollution Commission and the Regional Telecommunications Commission as well as being a River Hills trustee.

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