Part 6: Government relief is a key to growth
5:48 PM 9/04/03

Here's how government can help build Wisconsin's economy: Get out of the way.

Regulatory reform will be a key to state economic recovery and long-term growth. Wisconsin's regulatory system currently costs jobs and impedes economic development.

It's not necessarily the regulations themselves; it's the bureaucracy. A recent survey of executives showed that business leaders are more frustrated with how Wisconsin government runs its regulatory system than with the standards it imposes on their businesses.

Businesses aren't trying to duck regulations - but they want clear direction and fast action from the agencies involved in enforcing rules. Gov. Jim Doyle's recent directive that all state agencies make economic development their top priority is a nice political gesture, but the commitment needs to filter through to staff who write permits and develop rules regardless of the business implications of their actions.

Three common-sense steps would go a long way to promote business growth. Lawmakers and the Doyle administration should pursue measures that:

Impose deadlines for action on permit applications and exemptions. Streamlining would allow companies to get going on construction or expansion needed to adjust to a fast-changing marketplace.

Require agencies to assess the costs and benefits of proposals. This would force regulators to show how the risks they are trying to address are balanced against the costs to the business.

Clarify the circumstances under which the state may exceed federal regulatory standards and procedures. Wisconsin-only rules put the state at a disadvantage in a competitive global marketplace.

Government can do some good for business ledgers, too. Raising taxes obviously would discourage economic growth, but frankly, that's not much of a worry right now. Wisconsin will drop down the list of the top 10 taxing states because its two-year state budget contains no general tax increases. And although we're uncomfortable with loopholes in the new "single factor" tax law that calculates multi-state businesses' taxes using only sales of goods and services, the law itself should encourage more corporations to locate in Wisconsin.

As a good next step in tax policy, the state should act on the Wisconsin Technology Council's idea to let startup businesses in state technology zones program sell their tax credits to larger companies. The startups will get much-needed cash to ensure survival - and might reap sales opportunities in the bargain.

More broadly, the state must retool tax and aid policies that pit neighboring communities against each other in the race for economic development. Let's dust off the Alliance of Cities' plan for "metropolitan shells," which would bind a region's businesses and communities in clusters that help promote more rapid and efficient regional growth.

Nobody needs to awaken elected leaders to the urgency of these tasks. The governor has already launched an advisory council on economic growth and a new state Senate committee will very soon unveil legislation to streamline regulations, improve infrastructure and promote investment in jobs.

Elected leaders will of course seek credit for their economic efforts, but they must make sure economic development doesn't get bogged down in partisanship in the run-up to next year's elections. We can't afford more delay.

Political leaders should be able to agree that without regulatory changes and new tax incentives to promote innovation, Wisconsin will continue to lose higher-wage jobs to other states and countries.

Wisconsin's burdensome regulatory climate and tax policies surely aren't the only obstacles to economic growth. But both are issues that our lawmakers can easily address right now.