A New Era For Economics
Changing culture demands change in the way we do business

A speaker lecturing on building economic prosperity in the 21st century put it all in perspective: It is not about “trickle down” or “trickle up” economics anymore. It is about “trickle all around” – the globe, that is.

The meaning was clear. Companies will go wherever they can to boost stock prices and make a profit. We can like that or not, but it is reality.

Paying heed to “trickle around” demands that we leave much of the linear thinking of the 20th century behind.

What works in this era is very difficult. It is about doing all things all the time. It is about making strategic choices, some of which may not appear to relate to one another in the short run. It is about taking risks that may or may not pay off and teaching the public that such risks could be in their best interest in the long run. (Hardly anyone would argue with the gift of Toyota’s presence in the area, which at the time was a huge gamble.)

In taking on economic questions today, there often is no right or wrong answer. We have never been good at paradigm shifting, and we are not doing well at it now. The communities that are the first to understand and embrace the new paradigm will be the successful ones of the future.

The strategy for economic prosperity must begin with the basic unit of productivity today – the human being. The world has changed dramatically over the last century, with “people power” coming to the fore.

We started the last century as farm workers and ended it more urban than rural. In 1900, Kentucky’s population was 78.2 percent rural and 21.8 percent urban. In 2000, it was 55.8 percent urban and 44.2 percent rural.

Life spans were short at the turn of the 20th century, and both illness and accidents made human existence difficult and arduous. Education was sparsely meted out and served only to prepare students in the basics in order to enhance their productivity on the farm.

Things have clearly changed, but our attitudes and institutions have not. Life spans have lengthened. We live in cities and city-like settlements that are in dire need of attention, including a review of their structure and connection to other governmental units. The threats to human existence are not physical so much as the bewilderment of viewing the world through the lens of 24-hour TV news. When the world seems unfriendly and cold, it is easy for fear and distrust to sabotage citizens’ involvement in such things as effective economic development strategy.

Many things that made Kentucky attractive to business and industry in the past don’t have such appeal today. Cheap land can be found anywhere on the globe, so companies don’t have to go to Kentucky to get it. Cheap labor can be found in abundance as well – and it can be reached without much effort thanks to better transportation and technology that allows phone operators in India take customer service calls for companies in Indiana, or wherever.

If we are to prosper, we must begin at the community level and educate local leaders about the importance of focusing on their greatest asset, their people. And we must anticipate what those people will be seeking in terms of work and quality of life. The strategy unfolds from that point, and it is important that it unfold soon. Already, many of our communities are emptying out while others are filling up too fast with no grip on how to accommodate such growth. Meanwhile, the scourge of drugs has reached the most rural of our cities and towns and is symptomatic of the malaise that grips the people.

Here is a simple (but challenging) prescription for prosperity: Shift the paradigm to developing a culture of education for everyone – and do it like there will be no tomorrow without it. Cultivate the entrepreneurial spirit that makes work a larger part of a fulfilling qualitative life. Recognize the growing urban reality in which most Kentuckians now exist. Help revive the can-do spirit that has made our country great.

Sylvia L. Lovely is executive director and CEO of the Kentucky League of Cities.
editorial@lanereport.com

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