Curious Capitalist

How Columbus, Ohio Bounced Back from the Recession

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If you ever wonder what kind of economic development might be accomplished in this country with more bipartisan cooperation, consider Columbus, Ohio. It’s become a celebrity city of sorts lately, talked up in a New York Times Magazine piece about the success of Ohio, and visited over a dozen times by the presidential candidates on the campaign trail. No wonder – the Columbus metropolitan area has created more jobs than any other place in Ohio over the last two years and it’s become a model for what an economy can do when you admit that growth isn’t about tax cuts and austerity but about both streamlining government and investing in the right things.

The quick story of Columbus is that a Democratic mayor got a bunch of Republican businessmen in the city to agree to – gasp – a tax increase, in order to do the kinds of investments (in infrastructure, job retraining, education, and downtown renovation) that result in real growth. And that’s what they’ve gotten there. There’s plenty in Columbus that comes straight out of the Brookings/McKinsey playbook – German style industrial research centers, a strong community and state college system and smart ways of tapping Chinese investment. I could go on—but instead, you should go read my latest Curious Capitalist column in Time magazine, which tells the full story.

(MORE: How Bad is America’s Pension Funding Problem?)

Columbus is representative of a bigger shift in this country. I think that post election, the economics and job creation focus is going to move to cities and what’s happening at the local level in places like Columbus, Chicago, Portland, Raleigh, Minneapolis, Mesa, and San Jose. We’ll move from a simplistic conversation about tax cuts versus spending, and we’ll start admitting that we really have no idea why US GDP growth is as slow as it is, and there’s no one way to explain the 2 percent economy (which is really a 5 percent or 0.5 percent economy depending on where you live). And, we’ll have to start experimenting with lots of different paradigms. That will happen at the city level.

I think what we may see is a kind of industrial policy executed via cities; they become the petri dishes in which we do different growth experiments. Each one will tell a story – how to boost exports, create creative industry hubs, revamp housing, retrain Rust Belt workers, etc. There will be important political and cultural implications in all this, too (next week, I am planning to do some reporting in San Bernardino on that city’s attempt to use eminent domain to force banks to restructure underwater loans). As I said in my “Go Glocal” feature recently in Time magazine, all economics is local. Expect the economic and business news next year to be just that.

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Madamfrenchfry
Madamfrenchfry

Columbus is a great city and a great place to live!