Last month, by unanimous vote, San Antonio City Council accepted the much flawed Strategic Framework and Workplan presented by the City’s Economic Development Department. Instead of a real economic development plan, the council seems to be sticking to what they know: an updated commercial real estate site selection playbook.
But let’s not confuse running a large real estate program with a serious-minded economic policy analysis, formulation, and implementation agenda. Economic and business development are two distinct concepts, each having unique tenets.
Economic development, from my 35-year experience, is a concerted strategic visioning process led by community-based representatives and other stakeholders, leading to socioeconomic impacts and outcomes, resulting in increased standards of living and progressive economic health of a specific area. City leaders haven’t defined economic development in these terms, thus San Antonio has never truly worked toward real economic development.
The experts’ fatal flaw in the Strategic Framework and Workplan is focusing on subsidizing general economic activity around commercial real estate investment and negotiating for better wages. While city officials’ goals to seek higher wages and greater business investment are worthy objectives, these efforts do not constitute economic development. These gains are only markers toward greater goals and objectives; true economic developers are more ambitious. They need to see intergenerational, socioeconomic gains.
What we need is an ecosystem dedicated to socioeconomic development, where foundational, transformative, and structural prosperity becomes the principal policy innovation, institutionalized within a public-private paradigm.
We need to see definitive enabling factors, such as a technological absorptive capacity, a nurturing technological and business environment, and continuous, business internal, skill enrichment protocols. We need to establish benchmarks for achieving transformational goals, such as removing ourselves as a nationally-ranked poor city, an economically segregated city, a city heavily dependent upon tourism and federal subsidies, and as a retirement destination.
Instead of playing the competitive show-horse tax incentives game, where only a small percentage see success, a case can be made to invest in acquiring the assets of technologically interesting companies that failed in their original environment. There are examples of the successful use of this mode as a strategy to accelerate technological upgrading and industrial diversification like motorbike producer Zündapp and the coking plant Kaiserstuhl from Germany to China. In the process, tie in this approach with local start-ups and existing ventures.
How would we measure the success of new strategies in support of an entrepreneurial ecosystem? According to the Kauffman Foundation, these efforts should center on four indicators of vibrancy: density, fluidity, connectivity, and diversity. This approach alone is far superior to the “strategy” of commercial real estate site selection gamesmanship.
Thus, our metrics of economic development success would be grounded upon local entrepreneurship and talent, rather than recruited at high costs, tied wherever possible with technological investments, using local tax incentives for local investments, rather than for out-of-state hedge fund managers and investors.
Civic success will no longer be limited to GDP metrics and AAA bond ratings. Civic success will be defined more broadly by the news on the media’s front page rather than the news on the business page.
We also need to measure success for city residents, not metro or “area” residents as defined by Greater: SATX metrics. Measuring regional socioeconomic success is important as well, but it is a role tailor-made for the Alamo Area Council of Governments (AACOG), the metro counterpart to the City of San Antonio. Imagine the overhead cost savings.
Revising the commercial real estate site selection playbook would require a revision of the 2014 Vision Framework, a “policy direction” approach incompatible with an agenda for a transformational, socioeconomic paradigm.
A capstone toward a new strategic approach in operationalizing a meaningful agenda would also require updating the Good Government League-era job description of the City Manager’s position (see Art. V, Sec. 46). Current duties require the City Manager to advise on “the needs of the city,” a duty not clearly known to be done in the context of this discussion. To upgrade this job description would require a city charter amendment, a requirement that can be easily addressed by community leadership.
Instead of piecemeal, incremental dealmaking where transparency and accountability are spurious, we need an economic policy agenda benefitting local citizens more directly and in socioeconomic terms. We need a strategy to level up the city as a whole, positioning ourselves as a more advanced, innovative market economy.
Let’s think and act outside the City Hall bubble, let’s do things we’ve never done before or dared to do. Let’s make economic development a consequential concept, one which has meaningful impacts.