Today’s guest columnist is Daniel Coleman.
“We must cultivate our own garden.”– Voltaire
If we want to address Birmingham’s growth issues, we need to take charge of our future.
Growth is in our control if we are willing to tend to it. We should not expect economic growth to come from somewhere else. Such growth is ephemeral.
The benefits of growth created by someone else, somewhere else, will not accrue here. The benefits will flow elsewhere because jobs can leave as soon as owners find cheaper labor.
To fix our economic growth problems, we must cultivate our own garden by building our workforce, addressing the structural issues that inhibit competition, and discarding our zero-sum game mentality when it comes to economic growth.
Create workforce to meet demands of entrepreneurs
We need workforce development that meets the needs of entrepreneurs.
We need to create an economically diverse ecosystem to attract experienced employees to the region. We need our educational institutions to train people with the skills that entrepreneurs need, such as programming, cyber security, and data science.
Our educational institutions need to develop the critical thinking in our graduates, so they know how and where to apply these skills. Certification is not education; technology skills alone will not meet our needs.
We are competing with metropolitan areas with far greater commitment to higher education. We cannot measure ourselves against ourselves. Our success will be measured against the graduates who move to Atlanta, Nashville, Charlotte, and Austin.
Need to compete
Alabamans love to compete. What if the state government of Alabama passed a law that forced the University of Alabama to play only in state colleges in football?
Sure, coach Saban would have an easier time playing one, maybe two competitive games a year. What would happen if Alabama no longer played LSU, Georgia, Texas A&M, and Tennessee? Alabama would probably have even fewer losses.
On the other hand, Alabama would not be competing every weekend. It would not be as strong of a team outside the SEC. Over time, the best players who want to compete will play for colleges that do compete. Alabama’s team would no longer be in the top tier of college football.
The state government would never pass such a law. If they did, we would have an entirely new legislature after the following election. And yet, we declare victory when our companies and entrepreneurs succeed in state. We need to create companies that can compete with the best companies around the country.
Level playing field
Workforce development and the cultivation of local capital will take years to address. In the meantime, we cannot afford self-inflicted errors that further impede our growth. And yet we have them. We often make it harder on ourselves to compete.
One impediment is our tax law
According to the Hoover Institution report, Innovative Alabama, “The Tax Foundation …. ranks Alabama 41st in the country in its overall state business climate as represented by its headline tax rates and the transactions they apply to, but it separately rates Alabama 4th in the country in business incentives.” Innovative Alabama, p. 83.
The benefits of tax policy go to the few, and often out-of-state owners, de facto increasing taxes on everyone else. Our growing companies that have less of a voice in tax policy face a tax burden that is not competitive with our neighboring states.
Change how we think
Economic growth is not a zero-sum game.
Moreover, it can provide the resources needed to solve many problems we have as a state. We should not confuse complacency for stability, monopolistic consolidation for efficiency, certification for education. We should allocate our capital and resources on the merits of investments.
We should not expect crony capitalism to provide the benefits of free market capitalism. We should not blame free market capitalism for the unfairness and inefficiencies we experience in our state today.
We should be skeptical of grand plans; we should note where they come from and the motivations of the organizations behind them. We should embrace disruption. If we can change how we think about competition, if we can tap that natural home-grown desire to compete, economic growth will come.
Am I glad I came back?
Should I have come home?
I don’t think Brooke and I could have done anything else.
Sure, I have my bad days. I question my decision every time someone cuts me off on Red Mountain and then turns on their blinker. Those moments pass. I don’t seriously think about leaving. Rather, I obsess about making Birmingham better; I am consumed by the problems underpinning Birmingham’s stagnant economic growth.
And yet, I am hopeful.
I am hopeful because we share so much as a community.
Our civil rights past is no longer shameful, but a point of pride. We are religious people. We love football. (Sometimes we confuse one for the other.) We love food — Saw’s as well as Highlands. We are polite: we equate ugliness with rudeness. We love our families, even the members who root for the wrong team.
We can’t drive in the snow. But we can tell the difference between a copperhead and a garter snake. We think dirt is red; “the Pig” is a place for groceries; and a polygon is threatening. We know that the moon over Homewood is not a celestial object. And we always come to the defense of our hometown when an “outsider” slags us off.
I took the role as president of Birmingham-Southern College because it provides incredible leverage to improve the economic prospects, and therefore all prospects, of my hometown.
If ‘Southern can become a leading liberal arts college that integrates the technical resources of the 21st Century, BSC will be able to transform the workforce of this city by creating technically trained critical thinkers and thought leaders who will fill the vacancies at growing companies and accelerate their growth.
As with other institutions in this state, BSC will need your support. Its success can be your rifle shot, giving you leverage to push this city forward igniting economic growth.
This is the 5th of a 5 part series by guest columnist Daniel Coleman on fundamental issues that make Birmingham different and why Birmingham is not competitive.
- Man wakes from 35 year cryogenic freeze to find a new Birmingham
- Birmingham’s Colonial economy
- Why Birmingham is not competitive
- Birmingham secret weapon on west side hilltop
Daniel Coleman, a Birmingham native with more than three decades of experience in finance, is Birmingham-Southern’s 16th president. Coleman, who was CEO of the global financial services firm KCG Holdings until its 2017 sale, earned his B.A. in English at Yale University and his M.B.A. from the University of Chicago.
David Sher is the founder and publisher of ComebackTown. He’s past Chairman of the Birmingham Regional Chamber of Commerce (BBA), Operation New Birmingham (REV Birmingham), and the City Action Partnership (CAP).
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Invite David to speak for free to your group about how we can have a more prosperous metro Birmingham. email@example.com.