Assessing, anticipating pro-business legislation

It’s dangerous for a reporter to admit he or she is not all-knowing and not a world champion at perception. But let’s summon up the courage to step out onto the high wire of ignorance and explore a subject likely to be a little tender to some folks but is likely to be a noisy part of the 2011 legislative session. .

It seems to us the Missouri legislature has been distinctly pro-business in recent years, particularly when Republicans controlled both houses and the governorship.

It’s too easy to question why Missouri’s unemployment rate has been above nine percent for two years despite all that legislation. In fact it’s unfair to try to link the two circumstances although simplistic critics might be quick to do so. All of the states have been hit hard by the recession regardless of the variety of pro-growth legislation they’ve passed.

But now comes a study by the Kauffman Foundation and the Information Technology & Innovation Foundation and it does cause an eyebrow to rise a little bit. David Nicklaus’ column in the Post-Dispatch Sunday focuses on the study from the St. Louis perspective. Diane Stafford has taken the Missouri/Kansas perspective in the Kansas City Star on Tuesday.

The New Economy Index (PDF) resulting from the Kauffman/Information Technology study tries to measure the competitiveness of Missouri and other states in what is called the “new economy.” It uses something called “innovation-based vitality.”

Missouri is 33rd among the 50 states overall. We’ve been in the lower half of the index for more than a decade. Nicklaus is more alarmed by another ranking–economic indicators that are based in part on the fast-growing companies and the rate of business startups. In that category, Missouri is last. 50th.

Stafford says Missouri has benefitted from the immigration of knowledge workers and the presence of health information technology industry. But she says Missouri tumbles because of “lack of entrepreneurial activity and a high level of job churning.” We are last, therefore, in “economic dynamism.”

It’s been a long time since we took Econ 51 in college and we have long ago lost the understand how economic theory can be translated into economic reality. That’s why we’re a little baffled by the idea that Missouri is 50th in indicators that point to this state as a good place for businesses to start and grow. Isn’t that what the legislature is supposed to have been creating in recent years?

Maybe these things just take time to kick in and we’ll see Missouri rise in “economic dynamism” when they do.

The hot issue to be discussed in the 2011 legislature that supporters almost guarantee will make Missouri’s economy grow (although they’re not signing any pledges and they’re not saying it is the magic bullet) is Right to Work.

The Kauffman study looks at the ability of states to create economies that are “knowledge-based, globalized, entrepreneurial, IT-driven and innovation-based.’

Right to Work will be a big partisan fight next year between pro-business Republicans and traditionally union-backed Democrats. But will it be a fight between ideologies or a thoughtful debate about creating a “new economy” that encourages “entrepreneurial activity?”

We’ll wait to hear in 2011 if the debate focuses on lifting Missouri above 50th, or even 33rd.

Or have we been down so long that it will only LOOK LIKE up?

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