By Tom Still
MADISON – Gov. Scott Walker and Democratic challenger Mary
Burke have staked out major differences in their approach to job creation and
economic growth, but the candidates appear to agree on one significant item:
Reinventing the state’s flagship economic development agency was the right
thing to do.
Walker took heat early in his term when the Wisconsin
Economic Development Corp. ran into accounting troubles tied to its transition
from a traditional state agency to a quasi-public authority, but stuck with the
decision. Businesswoman Burke is a former Commerce Department secretary who
could have called for turning back the clock to how things worked during her
tenure – but she has persistently declined to do so.
That campaign trail consensus isn’t surprising in light of
recent history. The move to remake the former Commerce Department has
bipartisan roots dating to the 2010 campaign for governor, when the “Be Bold
Wisconsin” report was issued, and even to 2006, when a legislative audit portrayed
a patchwork quilt of state economic development programs.
Full disclosure: As one of the authors of the “Be Bold
Wisconsin” report, I confess to long believing that a quasi-public structure
for state economic development efforts would be more effective than a
traditional government platform. The old Commerce structure blended economic
growth strategies with many oversight tasks, such as building safety codes,
petroleum tank regulation and inspections of elevators and carnival rides. That
made it hard to focus on the core task – helping Wisconsin attract, retain and
grow companies and jobs.
During the 2010 campaign for governor, Walker and his
Democratic opponent, Milwaukee Mayor Tom Barrett, both embraced an overhaul of
the Commerce Department. The goal was creation of a more nimble, responsive
agency that could make development decisions – quickly – without undue
political influence or red tape.
Problems emerged in late 2011 when the transition from
Commerce was fast-tracked by Walker and the Legislature. With only six months
to change tires on a moving car, accounting for some public dollars fell
through the cracks. The agency recovered over the next few years, however, by
strengthening internal controls and bringing in bankers to tighten its underwriting
Meanwhile, the agency has put more people in the field to
respond to business inquiries, increased its overseas trade representative
program from four to 36 nations, and developed a mix of programs – such as
Capital Catalyst, Seed Accelerator and IdeaAdvance – to work with emerging
companies. It has divisions that focus on entrepreneurship and innovation as
well as larger industry “clusters,” two of which – water technology and energy,
power and controls – have shown recent progress.
Whether it was the old Commerce Department or the new WEDC,
the agency always had talented people on its staff. However, it lacked the
ability to be quick on its feet and the money to actually dance on the same
floor with states that spend a lot more on economic development.
Money is still part of the problem, but so is the fact that
Wisconsin policymakers have disagreed over what clusters are most important.
Some legislators and interest groups will insist that
manufacturing, agriculture and tourism are Wisconsin’s hallmarks, but others
will point to federal and private studies that show those sectors aren’t
expected to add many high-wage jobs over time.
Some experts say Wisconsin should be focusing more on
higher-pay, higher-growth industries such as financial services, business
services, life sciences and technology. Those sectors are predicted to create
more jobs nationally over the next four to six years.
No matter who is elected governor Nov. 4, the real challenge
is not the structure of WEDC – which will work better the longer it’s in place
– but setting priorities for where Wisconsin should place its long-term
economic development bets. That process must engage and inform elected
policymakers as much as the agency itself.
The WEDC structure has been built with help from Democrats,
Republicans and, most important, the business community. The question for the
next four years is how best to put it to work for Wisconsin.