Cap Times' reporter Steve Elbow's piece a few days ago confirmed what many observers of Wisconsin's economy have been saying for some time: When it comes to job creation, the state hasn't had its eye on the ball.
Elbow reported on a new study by two UW-Extension economic researchers who found that job creation in Wisconsin these days is fueled by newer and smaller businesses — startups, as they're known in the business world.
Yet under the Scott Walker administration, the focus continues to be on larger and more established businesses, a concept that's promoted by the state's free-spending conservative business lobby, Wisconsin Manufacturers & Commerce, which has long had a big influence on Walker's policies and his controversial Wisconsin Economic Development Corporation.
"Given the importance of new startups to job creation, the relatively low ranking for Wisconsin helps us better understand why Wisconsin's recovery from the Great Recession has been one of the slowest in the U.S.," wrote the economists, Tessa Conroy and Steven Deller.
Wisconsin ranked 47th among the lower 48 states in jobs created from new startups in 2012, the economists reported.
Walker, as most everyone remembers, promised that his policies would hike job numbers in Wisconsin by 250,000 during his first four-year term in office. The actual job growth was about half that and still is far behind the goal another year later.
Yet, despite the evidence that the state needs to be exploring new ways to keep and attract entrepreneurs, both the staid WMC and the Republican-controlled Legislature continue on their not-so-merry ways.
Legislators, in particular, seem much more interested spending their limited days in sessions waging parochial battles — destroying Planned Parenthood, banning fetal tissue research, stopping local fire departments from encouraging artificial Christmas trees in churches — than in finding innovative ways to jump-start Wisconsin's moribund economy.
Conroy and Deller found that not only does Wisconsin devote more resources to helping older established businesses, it tends to make things tougher for startups. The WEDC's tax incentives, for instance, come with requirements to create a certain number of jobs. The requirements are often too high for startups to qualify. Most small businesses take three to five years to get their footing and in the interim, total job numbers are relatively small.
What's even more perplexing about the Walker-led state government is how it has treated the University of Wisconsin System, arguably the state's biggest economic engine, especially since both the Madison and Milwaukee campuses have spurred numerous startups in recent years.
Instead of helping the UW build on that momentum, the university system has been the first place Walker and the Legislature have gone for cuts. It's not reaching to assume that much of the money taken from the UW has gone into tax incentives and grants to older, bigger businesses.
Conroy and Deller have a theory about why Wisconsin worries more about the bigger business execs than the new younger firms. Not surprisingly, it has to do with campaign contributions.
Wisconsin Manufacturers & Commerce has become the Republicans' main money machine, even more so than the Koch brothers' front groups and other outside special interests. So when it comes time to create policy to help businesses, it's the guys with the money who wind up with the spoils. Small entrepreneurs trying to get a start in the business world don't have that kind of pull.
The only problem is that the state — and its people — get left behind.
And that, of course, is where we are today.
Dave Zweifel is editor emeritus of The Capital Times. firstname.lastname@example.org and on Twitter @DaveZweifel
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