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A Call for Action – and New Ideas – on Economic Development

There is a huge gap in many of our comprehensive community development initiatives. Our communities, cities and our nation need better economic development strategies and programs.

In the 1980s and early 1990s, a burgeoning community economic development industry emerged. Industrial councils and CDCs implemented business retention strategies. Favorable financing supported business expansion. Tax Increment Financing (TIF) districts subsidized infrastructure costs. Commercial corridor redevelopment became commonplace.

But by the turn of the century, many of the organizations, programs, and human infrastructure were disappearing. In 2000, the Chicago Association of Neighborhood Development Organizations (CANDO) dissolved after 20 productive years. The National Congress for Community Economic Development (NCCED), representing 800 CDCs, turned out the lights in 2006. Smaller organizations across the country suffered a similar fate. Many that remain must struggle to survive.

Why? The economic boom of the 1990s made CDC-driven economic development seem unnecessary. Mayors, planning commissioners and council members led business attraction campaigns, but they pulled back from community-driven development to concentrate on the big hit: landing the corporate headquarters or a large production facility. Small-scale “guerilla warfare” economic development was either “taking care of itself,” or just “oh, so passé.” Foundations that supported economic development during the hard times turned to different needs. And certainly, some economic development groups lost their way, stretching beyond their core mission or attempting to follow the money.

While that was happening, the world around us changed. Think about it -- since 1990: the ubiquitous Internet, email, cell phones; HD TV, YouTube, Facebook, Google, notebook computers, netbooks, GPS, iPhones, iPods, iPads, and iTunes; MRIs, artificial knees, hips, retinas, livers and intelligence -- and that’s the list from just one Google search.

And, what about terrorism, climate change and outsourcing to India; computer viruses, malware, and spyware; MRSA, avian flu and H1N1; brownfields, mercury poisoning, offshore oil wells and the Great Recession?

The old strategies just don’t seem relevant or adequate.

While a few aggressive and innovative organizations are breaking new ground in the economic development arena, on the whole, it seems to me that both our strategies and our human infrastructure are struggling to keep up with the times – and I fear that too often they are losing the battle.

If we are about the business of creating healthy communities, how can we grow local businesses, create and retain jobs, and prepare our workers and our youth to be productive members of the 21st century economy? How do we produce opportunities for our communities in the new world order?

So many of us are building affordable housing, supporting after-school programs, crafting community safety initiatives, designing public health facilities, and much, much more. These are important and essential elements of comprehensive community development.

But, unless we adapt to the new world order and design strategies that build the net income and wealth of our residents; unless we grow the capacity to help our local businesses export products and import capital to our neighborhoods; unless we develop our neighborhood economies in ways that reflect the new business and technical realities, we will continue to struggle to create healthy communities.

Are your strategies working? Do you know a community or an organization that is developing its neighborhood economy effectively -- and connecting it to the regional, national, global and virtual economy? Share your story -- we need to know.

Joel Bookman is Director of Programs for LISC/Chicago and Deputy Managing Director of the Institute.


Keywords: business, economic development, technology

Posted in Commercial and Economic Development, Thinking Out Loud

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