Friday, September 18, 2009

Pretty Please with a Tax Abatement on Top

So apparently, Downtown Dallas has jumped into the blogosphere and advertising what is apparently the first step in the Strategic Action Plan for Downtown Dallas. The strategy: to build off the miracle success of bringing AT&T's HQ to DTD in a plan called "Bold Moves" and it is addressed towards Northeastern or Western companies struggling with their local or regional economies.

This might make some sense in a 1980's world view based on the local news report that the Texas economy will be among the quickest to rebound. I'm always skeptical of economic forecasts from these types of groups, because as I've mentioned before they are the type that get rewarded for optimism (sometimes blindly) and they draw straight lines to infinity extrapolating any current trend indefinitely.

Here are my problems with this strategy, and to be frank, I've seen it unsuccessful nearly everywhere it is tried:
  • First, these are company's that would relocate strictly based on a financial incentive package. Many companies (and an increasing amount of people in the new economy AND Millennials) locate based on quality of life and sense of place. What is to keep them from jumping again to a better offer or playing desperate cities off each other like Jerry Jones did with his new shiny stadium?
  • Next, while we would like to think this is a long-term strategy, it really isn't when you think about it. The economy became overly centralized in the 20th century and we're seeing the start of a very slow unwinding or slo-mo big bang despite those very industries desperate attempts to delay the inevitable and continue the economic darwinism threatening deeper and further repercussions. Markets fail with overcentralization and those pyramidal structures start slicing away sides of the triangle . Recruiting large companies, means companies that aren't going to grow or expand. Which leads me to:
  • Economic Development is cultivated by the seeds of innovation. Something created by smaller, more innovative and nimble companies and stifled by (and subsequently purchased) institutionalized corporate pyramids.
Conclusion: Make the city more livable and you will attract talented entreprenuers AND businesses that would choose Austin instead b/c of its increased cache over downtown Dallas. This means focusing on all the things that limit Livability in Downtown Dallas.