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Third Frontier Project: Cultivating High Technology in OH

Monday, February 18, 2002 at 3:57 PM

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The governor wants to use over a billion dollars of taxpayer money to cultivate high technology in Ohio. Supporters say the spending plan is just what Northeast Ohio and the rest of the state needs for it's economic future. But opponents complain it's nothing but corporate welfare. 90.3 WCPN's Mike West has more.

Mike West: Governor Bob Taft rolled out the “Third Frontier Project” during his recent State of the State Address. The announcement was followed by a promotional tour that included a stop in Cleveland at the Bio-Enterprise offices. Administrators of the business incubator are excited by the project. It calls for the state to spend $1.6 billion on bio-technology and high-tech companies over the next decade. Paul Nickels is the director of public affairs at Bio-Enterprse, which is located near Cleveland’s University Circle. He says the money is essential for creating the next generation of high paying jobs, which will in-turn help keep the state’s finances healthy.

Paul Nickels: Over the last two decades, Ohio’s per-capita income has slipped substantially from what it once was in the 60s and right through the early 70s the state of Ohio was actually above average in per-capital income. A lot of good factory jobs, a lot of union jobs as manufacturing ran into difficulties and those jobs started to slip away, we slipped beneath average on per-capita income and we have not been able to recover from that and that has huge tax implications. A one percent increase in per-capita income is a billion dollars a year in income in the state of Ohio.

MW: Mark Coticchia works across the street at Case Western Reserve University. He’s the Vice President for Research and Technology Management. Coticchia spent 20 years doing similar work in Pennsylvania before coming to Cleveland. In PA he says he witnessed firsthand the accelerated growth of high tech industries following massive spending by the state.

Mark Coticchia: I’m very excited about the proposals that the governor has put forth and if they come to fruition, Ohio will have the opportunity in the next few years to become a national leader by fusing technology and people through bold entrepreneurial initiatives.

MW: $1.6 billion may sound like a lot of money. Especially now when the latest state budget was so tight many programs where cut to the funding bone. The financial crisis was blamed on additional spending on schools because the state is being sued for not doing enough for poor districts. But Coticchia feels if you don’t spend enough to make a difference, you’re just wasting money.

MC: The state government shouldn’t just put up a couple million dollars here a couple million there. We need to think big and in a big way and put enough money forward to make things happen these are the kind of bold initiatives that Northeast Ohio, in general needs to put into place in order to make a difference and we can really and truly become a national leader in the area’s of our core competencies with this kind of commitment.

MW: But not everyone is as happy to part with their tax dollars money. Robert Lawson, director for The Center On Growth And Prosperity at the Buckeye Institute and an economics professor at Capitol University. He says the state should mind its own business. Lawson also questions who gets to decide which companies receive a fat government check. He calls the program corporate welfare.

Robert Lawson: I think it’s a bit arrogant. Central planning doesn’t work . It doesn’t work because politicians aren’t good at picking winners and there gonna spend a lot of money dumping into different technologies, yea they’ll create some things here they’ll create some things there. But in the end I’m not at all confident that letting us spend our own $1.6 billion the way that you and I would spend it ourselves isn’t a better way top go.

MW: Lawson contends government leaders can’t take credit for creating the high-tech wealth. He says state spending had nothing to do with creating the technology money machines that exist in cities like San Jose, Boston and Austin.

RL: There’s no way top plan for these things. The governor wants to have a plan. To create a Silicon Valley. A Silicon Valley doesn’t come from a plan, it just spontaneously happens, and I don’t think the governor can plan for it to happen here. We can spend a lot of money trying but I don’t think it’s probably going to work.

MW: But Governor Taft says the public spending program is an investment that is vital to the future of the state.

Bob Taft: We’ve heard nothing but strong support for the initiative. There’s a recognition that we have to build the high-paying new economy jobs the knowledge and innovation jobs in Ohio if we’re going to succeed as a state in the 21st century. We have programs to help our manufacturing base across the board in Ohio but that is not producing the number of high paying jobs that we need.

MW: Citizens and lawmakers will eventually have a chance to weigh in on the topic. Part of the package includes $500 million the governor wants to raise by selling state bonds. But the voters will have to approve a bond measure before that can happen. The other hundreds of millions that are proposed in various funding packages will have to get by state lawmakers during the budget process. In Cleveland, Mike West, 90.3 WCPN News.

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