Small Town Publicity—Good or Bad?

Yesterday, a newspaper reporter from a small town asked me about recent publicity that several communities in the Plains states have generated with free land giveaways for people who have moved there. She indicated that several families had taken advantage of the offer in her town of 1,000, but that the columnist Bob Greene had written some very negative things about the offers, calling them desperate attempts on behalf of the towns.

I told her that I thought that the free land could make a lot of sense, depending upon the town. I thought that the risk/reward ratio was in favor of the towns and that the publicity, even if negative, was probably beneficial. I told her, “When you are one of 15,800 small towns in the USA, any publicity is probably good publicity.”

She indicated that her town had gotten some people to move to the community as a result of the offer. She cited an example of one retired couple that had moved to the town and later had several of their children and families move there also.
My wife gave me a slightly different perspective last night. She was reading the April, 2005 Smithsonian magazine, pointing out an article about the Scopes Monkey Trial which took place 80 years. The trial put tiny Dayton, TN (population 2,000 at the time) in the national news during the entire summer of 1925. The trial, which electrified the country at the time, started as a stunt to put tiny Dayton on the map.

When Tennessee passed a law that made teaching evolution illegal and the ACLU announced that it would defend anyone who would challenge the statute, Dayton’s business leaders decided to recruit a volunteer. They found their candidate in John Scopes, a new teacher who had recently graduated from the University of Kentucky. Although he had never taught evolution up to that point, he agreed to start doing so and as they say “the rest is history.” While the publicity probably didn’t help tiny Dayton in the long term, for a short period of time they were the center of the news universe.

Buffalo, WY—Bigger than it Appears

I had a change of travel plans due to weather problems in Denver which didn’t allow me to fly from Sheridan, WY. Oh for those new micro jets taxi systems that are on the drawing boards that would have allowed me to fly directly from Sheridan to Monroe, WI! Instead I had to drive 2 hours from Sheridan to Casper, WY; flew to Minneapolis; flew to Madison, WI; drove to Monroe. Total elapsed time was 12 hours compared to about 3 hours under the new system. I can’t wait!

One good thing that happened with the change of plans was that I got to drive thru Buffalo, WY one of the 397 agurbs® that I identified in the book. It is a quaint little town with a population of 3,600. However, it has the look and feel of a town two to three times that great. Buffalo has a great downtown with lots of local character. I hope to return someday.

Most Foundations & Dollars Per Capita

How is that one community of 15,000 can have 39 foundations with over $250 million in assets? The smallest has $400,000, several have tens of millions of dollars, and two have $80 and $90 million each. At a 4% spending rate that is $10 million in annual giving! I had to find out how Sheridan, WY ended with so many foundations. How did the first one get started?

Edward A. Whitney was born in Massachusetts and educated in Europe, but found his way to Sheridan in 1885 when the three year old town had less than 100 residents. He quickly started the town’s first bank and delved into ranching. Never marrying, he was a very frugal person, living his entire life in a small apartment above the bank. He never owned house, car or even a horse and buggy. However, he traveled extensively over the entire world.

When he passed away in 1917 he bequeathed his estate to the town he had grown to love in his 32 years of residency. His will read, “My estate does not belong to me. I’m only its steward: it belongs to the people and I dare not be careless with it.” He specified that the Whitney Benefits Foundation should have 3 areas of focus in Sheridan, offering interest free loans for students; development of a community center; and establishment of an agricultural school.

From an initial funding of less than $1 million the Whitney Benefits has grown to over $90 million today and has dramatically improved the quality of life in Sheridan. In the last 10 years it has given over $20 million to Sheridan College, a two year community college and ag school built on Whitney property. Over $15 million in loans have been made to almost 5,000 students in Sheridan. A beautiful YMCA, new ice rink (Sheridan won the state hockey tournament this year), park and other improvements to this thriving agurb® have also been completed. Plans are in the works to improve Sheridan’s already thriving downtown area.

Other citizens of Sheridan have followed the lead of Mr. Whitney, giving back to their hometown. I was amazed when I was researching these foundations. In my travels and researching of hundreds of small towns the largest foundation I’ve found has been $20 million in a community of 20,000. Sheridan has over 10 times that amount! It is incredible how the vision of one person can shape a community and a region for generations.

Where the Antelope Roam, a Polo Cluster Develops

I was in Sheridan, WY this week giving a talk and touring this wonderful agurb®. Sheridan is nestled next to the Big Horn Mountains and the Big Horn National Forest, offering some spectacular views and great outdoor recreational activities. It has become a favorite second home location for many wealthy and famous people. As I drove from Casper to Sheridan, seeing hundreds of antelopes and other wildlife I could see why many have fallen in love with the area.

The town has a wonderful downtown area with a great deal of character. I saw only one vacancy, confirming its economic vibrancy. The historic Sheridan Inn, inaugurated in 1893 with Buffalo Bill, a part owner, leading the celebration adds a certain historical flair to the downtown.

As those of you have been reading me for awhile know, I’m fascinated with the impact of clusters upon an area. I found one of the most unique in Sheridan….polo ponies! Polo ponies! It started when the English road the railroad to Sheridan in the late 1800s looking for a spot to raise and train an abundant number of horses for the Boar Wars. They stayed, polo caught on and today several new polo fields are being constructed in Sheridan. Queen Elizabeth even visited the community in 1985 because of the town’s polo tradition.

I’ve got some other great stories from Sheridan that I’ll share in the next couple of days.

Community Survivors II

On Monday I was in Vancouver, WA, a magnificent community right across the river from Portland, Oregon for Maury Forman’s Community Survivors II program for communities and economic developers in the Northwest. It was a great program with talks on developing young entrepreneurs; utilizing your environmental advantage (a new subject for me); TechRanch in Bozeman, MT (one of my booming agurbs® that Rich Karlgaard has also written a great deal about); the importance of education and demographics and much more. Maury has one of the most innovative approaches to economic development education that I have seen.

I ran into friends from Colville, WA at the conference. Colville is one of my top 100 agurbs® that I visited last summer. I was pleased to learn that they had combined their chamber and downtown associations that previously had been fighting each other, into one organization. A small agurb® like Colville is WAY too small to have infighting going on like that and I counseled them when I was there to try to get everyone “onto the same page” and to reach out to other small towns. They are doing both.

The Dalles, OR, also one of the towns I visited last summer had big news to announce. They recently were selected by Google as the location for a new “server farm” that will initially hire 100 people. They are a town poised for great things.

The 3 W’s—How cool is that?

Yesterday I started on a three day journey that takes has me speaking in 3 of the 4 states that start with W. Yesterday I was in Vancouver, Washington. Today I’m in Sheridan, Wyoming and tomorrow I’m in Monroe, Wisconsin. How cool is that?

I’ll let you know what I find in each.

Regionalism in Fond du Lac

On Thursday I was to fly into Ripon, WI touring the county of Fond du Lac, addressing their 16 annual county wide economic development meeting. We iced up in Rockford, forcing me to drive to Fond du Lac, missing the tour of the county. And getting to tour agurbs® like Fond du Lac is one of my great pleasures in touring the country. I was sorely disappointed.

Ripon is the birthplace of the Republican Party, which was started by a group of “Freelanders” in the 1850s. The county is home of Mercury Marine, which headquarters a small engine cluster that accounts for 2/3 of all of the small engine manufacturing in the USA within 65 miles of Fond du Lac. With 31% of their jobs in manufacturing, Fond du Lac County has some of the highest wages in NE Wisconsin. And, Wisconsin has taken a lead in creating new manufacturing jobs when compared to other Great Lakes states.

The vision of increased regionalism evident in economic development in Fond du Lac impressed me greatly. A regional effort focused upon the Hwy 41 corridor from Fond du Lac to Green Bay and a 17 county NE Wisconsin economic development effort are steps in the right direction. No longer can agurbs® like Fond du Lac be an island unto themselves, but by working together with other communities the force of development is greatly enhanced.

Of particular interest to me in the NE Wisconsin study was an effort to create more clusters in the region and an emphasis upon entrepreneurial start-ups. Both are high on my radar screen from observing trends as I travel around the country. I particularly liked this quote from their report, “NE Wisconsin must abandon the economic strategy of a cost race to the bottom and embrace the concept of abundance theory—that by collaborating, the pie will increase with everyone getting a larger piece.” Fond du Lac is on the right track!

Henry Ford’s Amazon Misadventure

We visited Belterra, one of the two cities that Henry Ford set up in the Amazon during the 1930s when he tried to break Great Britain’s monopoly on rubber production. His other city, Fordlandia, was better known at the time. Despite pouring tens of millions of dollars into the development of millions of acres of land in Belterra and Fordlandia, Ford was never able to grow a commercially viable product due primarily to bad agronomy. He planted the trees too close together, which caused diseases to spread quickly in the humid tropics.

Ford’s operation was a typical top down model, with him trying to control all of the steps of production. The same fate would later occur in the 1970s and 1980s when another American billionaire, Daniel Ludwig, would try to do the same thing with cellulose production at his Jari Project in the Amazon. Again it was a top town, control-everything model. Neither Fordlandia nor Jari worked.

But, today the same land that Ford lost millions on is producing a much diversified agricultural economy. We saw soybeans, corn, rice, cassava, cattle, hogs, chickens, etc. being raised by hundreds, if not thousands of Brazilian farmers. But instead of a top down model, it is a bottom up one where the local farmers have experimented and learned a cropping system unique to the Amazon which allows them to productively and efficiently farm.

How does this relate to the agurbs®? I’m becoming more and more convinced that a “one size fits all” approach to economic development is not the way of the future. Our society is moving from a top down one to one that is fostering the creation of many new entrepreneurs. These new entrepreneurs are often from groups that have not been considered entrepreneurial in the past, but are going to blossom and thrive in the years ahead.

Back & Raring to Go

My wife Betinha and I had a great time on the Amazon and Orinoco Rivers in South America. We also stopped briefly at Devil’s Island, made famous by the movie Papillion.

I was very pleased with the variety of items that Megan Beeler blogged on in my absence. I’m glad that she didn’t tell you in the George McGovern blog that I voted for him for President. My family still gives me grief for that vote.

I’m off to Fond du Lac, WI later today for a talk and then have numerous talks lined up for the next several months. I hope to have some great things to report to you from the roads across America.

Jack is Back

Well if you pay attention you know that I'm not Jack. For the past few weeks Jack has been on vacation so I, Megan, his research analyst have been keeping up the blog. Today is my last day as a blogger. Jack is back in the country and eager to share his experiences abroad with you. But I have one final thought...

GO ILLINI!

Thanks for being faithful readers.

Megan Beeler

Observations on China

In this month’s issue of Inc. Magazine, a magazine geared toward entrepreneurs, start-ups, and growing companies, the focus was on China. In Ted C. Fishman’s article, “How China Will Change Your Business,” he highlighted some interesting points:

• “China will continue to offer American’s more bargains as time goes forward because the vast majority of U.S. imports still come from countries that pay relatively high wages.”
• “A 2003 survey of Illinois manufacturers found that 13 out of every 20 firms face competition from China. Of those affected, 84% state that Chinese competition hurt their sales by an average of at least 17% that year.”
• “If it were a nation, Wal-Mart would now rank as China’s fifth-largest export market, ahead of Germany and Great Britain.”

Math Skills- You will use them someday.

Two recent studies have confirmed what many Americans and especially American employers have known for quite awhile. U.S. students are failing math. An international study sponsored by Organisation for Economic Co-operation and Development found that 15-year-old American students performed below average among all 40 participating nations and ranked beneath most industrialized countries on math. The Trends in International Mathematics and Science Study placed U.S. fourth-grades 12th of 25 countries in math and eighth-graders 15th of 45 countries.

These days U.S. companies are taking the problem, and solution, into their own hands. Many companies find themselves spending more time and money on training programs to get workers up to speed on basic math skills. Carhartt, the outdoor clothing manufacturer, realized that employees at its Kentucky customer service facility had a hard time using some of the equipment because they had weak math and computer skills. So the company parked a mobile classroom at the plant and held classes after shifts ended.

So many companies are stepping up to this challenge that used to be exclusively addressed by the public-school systems that government firms, non-profits, and local start-ups specializing in funding and supporting these basic training endeavors are popping up all over the U.S.

If you’re ever speeding through Murray City, UT

In January Jack spoke in Murray City, Utah. He came away with a good impression of the town. One reason why is their creative mayor. When Daniel Snarr was elected he asked, “What is the City poem?” He was told that no one knew of such a poem, so he said “Wait a minute and I’ll make one up.” Here it is:

MURRAY POEM
When driving through Murray,
Don’t be in such a hurry.
S-l-o-w down, and spend a buck or two.
That would be a nice thing for you to do.
It would help our tax coffers swell,
So our City won’t go to hell!
-Mayor Daniel C. Snarr

The mayor has since added motions to illustrate the lyric – including leaping if the space allows. The poem has become the rallying call for many of the town’s officials. In fact, the Assistant Chamber of Commerce Director was late and hurrying to a meeting, when she was pulled over by one of Murray’s finest law enforcers. As he came to her car window she was ready with her driver’s license, but said timidly, “When driving through Murray- don’t be in such a hurry-“ Before she got to the third line of the poem, the officer was almost rolling on the ground in laughter and gave her a warning ticket. Thanks to Keith Snarr, Murray City Economic Development Director, for sharing how to get out of a Murray City speeding ticket!

Working Together Works

At a recent IEDC conference a panel of site selectors answered attendee questions. One attendee asked for advice on creative ways to make one’s community stand out. The consultants’ answer seemed so easy. But unfortunately it is often times the last thing a community thinks of when they are trying to land a company – cooperation. Apparently, it is the one thing that consultants don’t see often enough. Dean Foote, CEcD, senior project manager for economic development real estate services with Carter & Burgess said, “Put the swords away and work with your neighbors. It helps us sort through a project.” The consultants indicated that communities that get all of the fundamentals right are a pleasant surprise. This means having all the key players – the utility, the president of the college that would provide training, the mayor, and other leaders – in the room and having them show that “they’ve talked to each other more than once before.” Working together works.

Manufacturing Death Matrix

A recent issue of Blane Canada’s Economic Development Marketing Letter had this analysis from Eric Davis, Owensboro, KY. How to evaluate the longevity of a local manufacturer? Look at the following criteria.

1. Low skill requirements
2. Higher than average wages
3. International competition
4. Union activity
5. Lack of investment and/or technological change in the industry

Davis argues that “if you identify 3 of the 5, that’s an indicator that they are packing their bags. Four out of five means they are as good as gone.”

The next time you hear a politician casually use the word “billion” remember this.

Every day we read about this government committee needed so-many billion dollars for such and such, or this organization spending so-many billion dollars to build XYZ. We hear “billon dollars” so much that it has lost some of its meaning. A billion is a difficult number to comprehend, but one advertising agency did a good job of putting that figure into perspective.

A billion seconds ago it was 1959.
A billion minutes ago Jesus was alive.
A billion hours ago our ancestors were living in the Stone Age.
A billion days ago no-one walked on two feet on earth.
A billion dollars ago was only 8 hours and 20 minutes, at the rate the government spends it.

Did Watford City Get What They Bargained For?

They put in the infrastructure and expected hordes of entrepreneurs and companies to pull into town. Watford City has attracted several information-dependent service companies and boasts some great amenities (surprising for a town this size), video-conferencing centers, high speed internet providers, e-banking, and an e-pharmacist, but hordes of companies isn’t exactly what happened.

Watford City learned an important lesson- technology alone can’t save the heartland. The community quickly learned that most telecommuting professionals prefer mountains or the ocean in their backyard. But the current residents are feeling more encouraged to stick around and local entrepreneurs were eager to experiment with the new technology.

Yesterday I mentioned the e-pharmacist. Larry Larsen, local drugstore owner became North Dakota’s 5th e-pharmacist. He sells prescriptions online, but that’s not what makes his operation unique. He uses internet video to monitor (remotely) each step of the prescription filling process at his second pharmacy 50 miles from Watford City. Then he and his customers can converse e-face to e-face in private rooms. This technology has lowed Larsen’s costs by allowing him to employ a less expensive pharmacy technician rather than a full-time, hard to find pharmacist. Larsen believes that the forward-thinking people that came back to Watford City saved Watford City.

Did Watford City Get What They Bargained For?

They put in the infrastructure and expected hordes of entrepreneurs and companies to pull into town. Watford City has attracted several information-dependent service companies and boasts some great amenities (surprising for a town this size), video-conferencing centers, high speed internet providers, e-banking, and an e-pharmacist, but hordes of companies isn’t exactly what happened.

Watford City learned an important lesson- technology alone can’t save the heartland. The community quickly learned that most telecommuting professionals prefer mountains or the ocean in their backyard. But the current residents are feeling more encouraged to stick around and local entrepreneurs were eager to experiment with the new technology.

Yesterday I mentioned the e-pharmacist. Larry Larsen, local drugstore owner became North Dakota’s 5th e-pharmacist. He sells prescriptions online, but that’s not what makes his operation unique. He uses internet video to monitor (remotely) each step of the prescription filling process at his second pharmacy 50 miles from Watford City. Then he and his customers can converse e-face to e-face in private rooms. This technology has lowed Larsen’s costs by allowing him to employ a less expensive pharmacy technician rather than a full-time, hard to find pharmacist. Larsen believes that the forward-thinking people that came back to Watford City saved Watford City.

Re-inventing Watford City

Watford City, N.D, invested a lot of time and money to reinvent itself in the mid-1990s. The old oil and ranching community tried a path that many rural communities are turning to these days- technology.

Gene Veeder had returned to Watford City in the mid-1990s and became the job-development authority for McKenzie County, where the local economy had fallen on pretty hard times. He didn’t know a “T1 line from a T-bone steak” but decided to get informed after hearing a telemarketing company that was considering relocating to the area talk about this new-fangled technology. The community and school district worked together to set up T1 internet service to local government offices at a fraction of the typical costs. This expanded into service for residents as well. By the time the state economic-development officials came to Watford City to promote their own rural internet strategy they found that this little town of 1,400 people, 3 hours from the nearest city of 50,000 or more, was already gigabytes ahead! Watford City resisted the rural stereotypes and become one of the most wired small towns in America.

Short-term memory

Yesterday I told you about George McGovern’s enlightenment (initiation by fire) of the small business owner’s quandary. We saw how McGovern came to realize that the government intervention he so prominently promoted in his political career was swallowing small business owners in regulations and paperwork. But did he do anything with this knowledge or did he revert to his old way?

Well, other than a few articles in the early 1990s sharing his knowledge and showing a less-liberal side of McGovern than anyone had seen before the effect was minimal, and it seems short-lived. In a 2002 article in Harper’s McGovern seemed to have forgotten that business even exists, reverting to his more laws, higher taxes, stiffer regulations type of government. He wrote, “Virtually every step forward in our history has been a liberal initiative taken over conservative opposition: civil rights, Social Security, Medicare, rural electrification, the establishment of a minimum wage, etc.”

It seems that the accomplishments of private citizens are completely disregarded in light of the brilliant accomplishments of government. Robert Fulford, writing for the National Post, appears to have it right when he said McGovern, “suffered under the system he had helped create, apologized for it – and then forgot precisely what he had learned.”