Forget Washington -- Cities Will Win or Lose America
Jim CliftonNovember 14, 2012
Throughout this year’s long election season, I was often asked: “Who will be better for jobs and the economy, President Obama or Governor Romney?” My reply most surely disappointed partisans from both sides: The president of the United States doesn’t make as much difference in terms of creating economic energy as you’d think, according to Gallup data.
In fact, if the president mattered that much, why is it that cities and states have such extreme variation in their local GDP and job growth? Shouldn’t they all go up or down together with each president?
Instead, Austin, Texas, and Nashville, Tenn., are booming, while Albany, N.Y., and Stockton, Calif., are failing. Texas is prospering while California is almost surely going broke. Austin’s jobless rate is around 5%, while the unemployment rate in Stockton is above 13%.
The reality is, when it comes to creating economic growth and good jobs, local leadership trumps national leadership. For instance, Austin and Albany are both capital cities in big American states. Neither city is located by a port or a natural tourist attraction with beaches or mountains. They’re pretty much alike, except that Austin wins big and Albany loses big.
The difference, in my view, is that Austin has deeply caring, highly engaged business, political, and philanthropic leaders with principles, policies, beliefs, and values about human nature that work. They understand how to build a thriving, growing economy -- one that welcomes business and entrepreneurship. Albany has the opposite, as I see it: Leaders with principles, policies, values, and beliefs that discourage business and entrepreneurship, if not outright scaring them away.
Cities across the country with great leadership are filled with booming startup companies, and those cities have thriving economies that create authentic, organically grown good jobs. These cities are saving America, while the others are letting the country down.
Great city leadership has never been so needed. Nationally, business startups are currently growing at under 400,000 annually. If this rate doesn’t double soon, in my view, absolutely nothing will fix our current nightmare of joblessness.
And this just isn’t a problem that Washington can fix, regardless of who is president. Of course good policy for small businesses is better than bad policy, but in my opinion, the estimated 10,000 business, political, and philanthropic leaders of all shapes and sizes who drive the performance of America’s top 100 cities are the most important people in our country right now. Nothing can be more important to these essential American leaders than turning their towns into roaring economic engines that encourage entrepreneurs to thrive. When it comes to building and sustaining economic energy, frankly, they matter more than the president.
The United States is at a critical juncture in its economic history. Whether the country makes a historic comeback or slowly goes broke, it will do so one city at a time.
Jim Clifton is Chairman and CEO of Gallup. He is author of The Coming Jobs War (Gallup Press, 2011).
That is true to some extent but what happens at the federal level does make a difference. When government takes from producers and gives to non producers it does affect the economy since such giving produces nothing and is a drain on the economy.