Oregon's lackluster economy is not solely the result of the nation's recent recession.
Along the wide spectrum of state economies, Oregon's situation continues to be worse than most - even as the United States finally enters what seems to be a sustainable recovery. There are a variety of opinions about why Oregon's economic lows are lower and why its recoveries are slower than what most other states experience. But Oregon's unemployment rate, which even now is the 14th worst in the nation, remains as evidence that state leaders must cooperate toward a better economy.
A more focused approach
In preparation for the Feb. 1 legislative session, state Treasurer Ted Wheeler is offering one economic plan worthy of careful bipartisan consideration and adoption in some form. Wheeler and his staff have spent months studying and gathering input about how Oregon can do a better job of investing the limited funds it has for economic development.
What Wheeler has concluded is that state government takes a scattershot approach to assisting business growth in various economic sectors. Different state agencies pay attention to specific industry needs such as agriculture and energy. They may have the ability to make business loans and other investments for their particular constituencies, but oftentimes, in Wheeler's opinion, they aren't held accountable for showing whether these expenditures produce real results - such as good-paying jobs.
Wheeler's idea, embodied in the Oregon Investment Act (House Bill 4040), is to gather up as many of these funds as possible and put the decisions about how they are allocated in the hands of a newly formed Oregon Growth Board. By pooling resources, defining clear goals and creating a better system for measuring results, Wheeler says this new investment fund can become a powerhouse that helps drive the Oregon economy for decades to come.
Indeed, other states such as Ohio have created similar funds and have invested with success in industries that show the most promise for future growth. Wheeler's initial concept is much more modest than Ohio's $1.6 billion fund. But he is correct in arguing that Oregon must sharpen its economic focus and put measurements in place to keep the public informed of the outcomes of state-sponsored business activities.
Vow to act differently
Many aspects of the Oregon Investment Act have been left purposefully vague. House Bill 4040 would create a framework for more meaningful use of state funds, but it leaves most of the bigger questions for later.
The bill starts by placing the existing Oregon Growth Account under the authority of the new board. Later, other business-assistance efforts would be placed under the same umbrella, based on recommendations of the new board and with approval from the Legislature in 2013 or future sessions.
With funding from the Oregon State Lottery, the Oregon Growth Account has provided $99 million in seed capital to help Oregon start-up companies since 1999. The growth account's returns aren't overly impressive, but that fact also reinforces Wheeler's assertion that there's plenty of room for improvement if the state is more strategic in how it invests its resources. Plus, the growth account would just be a starting point for the Oregon Growth Board, which will look to pool as many resources as it can to create a state investment fund that is robust enough to make a real difference for Oregon's businesses, workers and families.
Oregonians are very adept at lamenting the fact that this state should have a more successful economy. But what goes beyond mere complaining is a commitment to have this state act differently than it has in the past. Wheeler's proposal would force one such departure from past behavior, and it deserves an open mind from any legislator who is serious about promoting a better Oregon economy.