Monday, September 22, 2014

Madison economy thriving in spite of the WMC/Walker Way

This week's Isthmus featured an intriguing and in-depth article from Mark Eisen explaining how Wisconsin Manufacturers and Commerce ignores the growing tech industry in the state. Take a look at this set of quotes from actual job creators- people who have started and successfully run new tech businesses in Wisconsin.
"I only know about WMC because their building is near my house," says Niko Skievaski, the cofounder of tech-focused 100State and 100Health. "I walk by it and wonder: 'What the hell do they do?' I haven't heard of any of their representatives reaching out to entrepreneurs."

Skievaski's colleague in Milwaukee, Matt Cordio of Startup Milwaukee, says the same: "Nobody from there has ever reached out to us. I have no idea of what they really do."

Ditto Matt Younkle, a principal in the music storage service and a cofounder of Capitol Entrepreneurs, the influential tech-leaders group in Madison: "I've never been approached by WMC -- I don't know much about it."

And, yup, Forrest Woolworth, a cofounder of both PerBlue mobile gaming and Capitol Entrepreneurs, tells the same story. "WMC is pretty much in a whole different world from us," he says. "We've had no interaction with them good or bad."
And while the WMC types whine about Madison’s “anti-business attitude” (because it believes in horrifying things such as paying taxes for services, strong city planning and worker’s rights), it’s worth noting that this “anti-business” area keeps growing jobs. Eisen points out data from researcher Joel Kotkin that notes the Madison area had jobs go up 3.6% between 2008 and 2014 (which account for the Great Recession and its current recovery), while cities such as Milwaukee and Chicago still aren’t back to where they were six years ago. The recently-released Quarterly Census on Employment and Wages also showed that Dane County is the place to be when it comes to job growth in Wisconsin, with nearly twice as many jobs added as the second-place county.

Most private sector jobs added, Wisconsin Mar 2013-Mar 2014
Dane County 4,218 (+1.8%)
Marathon Co. 2,290 (+4.0%)
Waukesha Co. 1,850 (+0.9%)
Sheboygan Co. 1,710 (+3.4%)
Kenosha County 1,363 (+3.1%)
Milwaukee Co. 1,130 (+0.3%)

The same trend holds when you expand it back to the last 3 years. While much of the rest of the state has floundered to the worst job growth in the Midwest, Dane County has stayed strong.

Top Wisconsin private sector job growth, Mar 2011- Mar 2014
Dane County 14,120 (+6.4%)
Milwaukee Co. 8,869 (+2.2%)
Waukesha Co. 8,790 (+4.4%)
Marathon Co. 3,856 (+6.9%)
Brown County 3,729 (+3.0%)
Rock County 3,551 (+7.3%)
REST OF THE STATE 51,614 (+4.5%)

As Eisen’s article in Isthmus notes, WMC (aka, where GOP staffers and hacks cash in) is overloaded with old Wisconsin businesses and oligarchs, and don’t really talk too much about how to attract new business and entrepreneurship to the state. Hilariously, WMC President Kurt Bauer is quoted in the story as saying Judy Faulkner, CEO of the fast-growing Epic Systems in Madison, won’t even meet with him when it comes to talking about to attract young up-and-comers into Wisconsin. Maybe it’s because Judy knows how the Old Boys Club does business in Wisconsin, and decided she wasn’t all that interested in dealing with the “Mad Men” mentality that these guys have.

There's another telling statement in Eisen's companion article that talks more about the younger leaders in Madison's tech scene and the politics involved. And it's an older guy on the scene that illustrates how Walker's policies don't really do much to help up-and-coming businesses.
Mark Bakken, 49, is a leader in the new Wisconsin economy. His Nordic Consulting, which counsels medical facilities on optimizing Epic's electronic medical records, has proved a huge success. Nordic's revenues this year are expected to hit $120 million just four years after the company launched. The company's workforce totals 430, including 190 in the Madison area.

"Tax credits are worthless," Bakken says. "They're just handouts. They will not sway one person on whether or not they're going to invest in a startup."

Bakken, who is a serial entrepreneur, explains that investors put their money on the strength of a company's business plan and the savviness of its management team. "If there happens to be a freebie from the state, great. But it's a freebie," he says. "I've personally invested in 15 different startups. I'm not doing this because of some crazy law."
In other words, it's about good ideas, cultivating TALENT, and having the market for it to work. Tax credits change next to nothing in that equation, and often make it worse by decreasing investment in the very factors that make a start-up more viable.

And let’s be honest, WMC isn’t really about “raising the game” or “improving competitiveness” when it comes to Wisconsin business. It openly advocates for candidates that have voted to disinvest in public schools, destroy local services (in the hopes that they’ll be privatized for profit), back regressive social policies on issues such as abortion and marriage equality, refused to take advantage of federal assistance to develop new initiatives such as solar energy, rural broadband, and high-speed rail, and WMC has no problem with taking money out of the pockets of hundreds of thousands of workers. Instead, all the WMC types care about is maximizing profits for themselves, and they don’t care whose expense that comes at, or if it eliminates the quality of life metrics that would make the state better for business.

WMC is filled with disgusting greedheads and nepotism cases that care more about hiring politicians than employees, and they not people that should be listened to when it comes to figuring out a strategy to move the state’s business climate ahead. It is telling that Scott Walker trusts these types to organize much of his economic strategy, and that Wisconsin is dead last in job growth over the 3 ½ years that strategy has been carried out.

Hmmm, maybe Scott Walker shouldn’t rip on “Madison liberals” and have his puppetmasters file lawsuits to screw over Dane County public workers. Maybe instead he should thank us from keeping the state from being either further in the hole on jobs than we already are, and learn something from Dane County’s success. Maybe we need someone from that overeducated socialist city of Madison to lead this state out of the doldrums. After all, we seem to be one of the few places in the state that are doing well when it comes to 2010s-style capitalism.

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