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February 27, 2013


Economic amnesia and upstate

E.J. McMahon

Carl Schramm, entrepreneurially minded economist and professor at Syracuse University, worries that “economic amnesia” may hinder the long-term recovery prospects of Syracuse — and, by implication, other once-dynamic upstate cities.

Writing in Forbes, Schramm notes that the Syracuse of the 19th and early 20th centuries relied on home-grown talent to become an economic dynamo — a place variously known as the Candle City, the Crafts City, the China City and the Gear City for its innovative methods of producing everything from tapers to motors. Today, Syracuse is afflicted with a heavy tax burden and high poverty rates, which in term threaten the long-term fiscal stability of its city government.

Schramm, a Syracuse native and former president and CEO of the Ewing Marion Kauffman Foundation, thinks kids growing up in Syracuse today need more entrepreneurial role models like Lyman C. Smith, the now-forgotten Syracuse industrialist who pioneered mass production of the first mass-market word processor — the typewriter.

Meanwhile, writes Schramm:

There is no silver bullet that an outside expert can describe that will change things – no recruiting so called “creatives” to come here, no building a prescribed “cluster” of new industries around a city’s alleged comparative advantages, and no amount of business planning can make this happen. Where a city’s permanent resident population continues to build its economy the process can best be described as “self-owned.” Government’s most effective role is to encourage with economic signals such as reducing local regulatory burdens (licensing, zoning and inspections), lowering property taxes, providing grace periods from labor law that might not be applicable to start-up businesses, and providing only the infrastructure that emerging businesses, not imaginary “ideal” businesses, need. Simply, “backing off” is likely a more effective strategy than trying to force economic growth according to some expert’s playbook.

Thoughtful advice, although somehow it’s difficult to see Governor Cuomo and other Albany politicians “backing off” from their favorite economic development nostrum — i.e., doling out borrowed state capital funds for various “investments” — anytime soon.

1 Comment »

  1. Does anyone out there have any ideas on how to force entrepreneural reform as suggested above in NY State? What achievable goals & methods can be used to circumvent Cuomo & legislature and make NY #1 instead of #50 in Economic Vitality?

    Comment by Ralph Mitchell — March 3, 2013 @ 12:31 am

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