Arkansas Economic Development Commission

Good Government Makes For Good Economic Development

November 29, 2017

Prior to joining the Arkansas Economic Development Commission, I worked in the utility and energy sectors, both of which experience considerable regulatory and government oversight. As is the case for most industry sectors, persons elected or appointed to office who are actively engaged with fiscal, regulatory, legislative, or merely local governance can mean facilitating growth and success for business, unnecessary impediments, or even failure. Below are my five quick thoughts on what companies value when it comes to good government.

Arkansas Governor Asa Hutchinson supports economic development

Fiscal Certainty & Predictability – States and communities that have declining revenues, cannot balance their budgets, and have looming big ticket pension or infrastructure obligations have to raise revenue, and taxing business is often more politically palatable than taxing citizens. A Midwestern state to our north is facing severe fiscal challenges, and businesses are being faced with costs and uncertainty that will ultimately have diminishing returns for the next 20 years. Unfortunately, improper planning on some states’ part IS constituting an emergency on businesses’ part.

Constituent Trust and Buy-in – Companies don’t like to be the “pilot project” for determining the level of community acceptance and support. If a location is recommended by a state or community, if permits are couched as likely, and if the incentives commitment is deemed reasonable by all parties, no company wants to learn after an announcement that their company and their project are not welcomed, thus exposing them to unnecessary risks. Good government has everyone on board and knows the pulse of the community before commitments are made and before a project becomes public.

Protect Thy Brand – Companies, states, and even athletes are all concerned about protecting their brand. Governors, state legislators, and local officials who understand the increasing importance of having a legal environment and business climate that is socially benign and lets business do business helps mitigate a growing concern for company leaders who increasingly have to devise contingency plans for boycotts, public protests, and social media campaigns. 

Civil Discourse – When state and local leaders engage in family feuds and a public war of words within the media, economic development, business, and political circles, it is counterproductive to the state’s or community’s image and economic progress. Existing business — not just prospective — will have a lot more confidence in leadership that really works well together.

The Language of Business – The language of business doesn’t always sync with the language of government, so when governors, mayors, and appointees can exercise a good business vernacular, they more readily connect with business leaders. I’ve regularly witnessed a Governor who fluently speaks CEO-talk and have perceived that company leaders find it genuine and refreshing.

So, whatever your leadership role is in your state or community, remember that good government sends a strong message and makes for good economic development.

 


picture of Danny GamesABOUT DANNY GAMES

Danny Games, CEcD, is Executive Vice President, Global Business for the Arkansas Economic Development Commission.
He directs the Business Development, Business Finance, Community Development, Existing Business and Minority & Women-Owned Business Enterprise divisions at AEDC.