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Time for the Innovators

By James Call


Tallahassee, FL – The Legislature has cut about $7-billion from the state's annual budget over the last three years. Lawmakers are expected to wield their axes again in 2010 when they convene in regular session March 2nd. However, Governor Charlie Crist is proposing a different approach. Crist and a few other policy makers say the worst of the recession is over, and Florida is poised to begin fostering sustainable economic growth.

"Don't ever get down. That's easy. It's easy, you know, to be brought down by the negative stuff that you may hear out there."

Governor Crist's relentless optimism provides editorial cartoonists with a lot of material. In mid-February, he spoke to the board of directors of Workforce Florida, a worker development initiative. More than a million Floridians are out of work, and the state has the nation's fourth highest home foreclosure rate.

"We have an emerging economy in Florida. But we have an economy that for decades really had been based on agriculture, tourism, you know, the kind of things we as Floridians, the housing market, think about it. But we have to be much more innovative going forward."

Crist was elected when the financial crisis began. Floridians have ridden a boom and bust cycle of a land-rush economy ever since developers began draining swamps more than a hundred years ago. The state's economy depends almost entirely on growth and the wealth generated by the construction and real estate industries.

Florida's population stopped growing about two years ago, and some areas recorded record-low housing starts last year. Still, Crist maintains the future is bright. Instead of spending cuts, he's proposing tax cuts and more spending. The governor and others argue Florida is now poised to succeed in areas like bio-tech, renewable energy and knowledge-based industries.

"Florida has a relatively large industry in the professional, technical and scientific services, and a lot of innovation and technical innovation comes out of those kinds of businesses."

Denny Dennis is a senior research fellow with the National Federation of Independent Business. He spoke at a seminar about Florida's economy. He thinks Florida's long-term future is bright. He says it's a place that has attracted a lot of creative, educated risk takers, which are the ingredients needed to produce something big.

"You have a bunch of people in a very dynamic area, and things are changing all the time, and by the way, I think it would be better to do it this way, and George did it over there that way, but that's not quite as good as doing it this way and so on. That's why you get these pockets of innovation. So you go out to California, you go to the Silicon Valley, for example. That was the classic one. It's certainly not the only one, and it's not the only thing."

Fort Lauderdale Senator Jeremy Ring was one of the people on the ground floor of Silicon Valley. A former executive of Yahoo, he is the vice chair of the two-year-old Select Committee on Florida's Economy.

"We have out of the University of Florida as much research development and patents as any school in the country, Stanford and MIT included. So we are in a position to take advantage of that, and that is much more sustaining and a much more powerful foundation than a construction economy is."

Since 2008, the select committee has studied capital attraction strategies, tax policies, and targeted investments. Its sweeping jobs bill was pulled from a Ways and Means agenda for some final tweaking. It may reappear the third or fourth week of the session. Ring, committee chairman Don Gaetz, and Governor Crist say they want to support small businesses and entrepreneurs in the pursuit of the next big thing.

When asked about what could be the next big thing for Florida, the NFIB's senior researcher Denny Dennis responded with this question.

Dennis: "Do you remember a guy by the name of Desi Arnaz?
Reporter: "Yes, Lucy's husband."
Dennis: "Do you realize that he was a great entrepreneur? Do you have any idea what he was an entrepreneur in?"
Reporter: "Oh, situation comedies, the production of the TV show."
Dennis: "Of reruns, not of the shows. They had been doing that all along. He decided that we are going to film them and sell them as reruns. He invented a business. That was kind of like a huhhh."

Dennis's says that a lot of economic growth comes from "huhhh" moments, problem solving or creating something quicker and better. This economic perspective fits the governor's narrative. House and Senate leaders greeted Crist's budget proposal with skepticism. They say it is doubtful that they can avoid spending cuts, eliminating programs and laying off employees. Crist maintains that he sees a light at the end of a tunnel and wants to increase spending by four-percent to $69.2-billion. He suggested to the Workforce Florida board that when legislative leaders talk about the worst economic conditions in a lifetime, Crist may not be listening.

"I know that it exists, and I know that it's reality. But I also realize that we're Americans, and we don't give up, and we do not slow down, and it is your duty on this panel and it is my duty as your governor to try to keep lifting the spirit of our people, because there is light at the end of the tunnel, and there is good news going on throughout the state of Florida. There are indicators that show that there are some roots starting to sprout."