Columbia must get accustomed to providing manufacturing incentives

Some uneasiness is beginning to develop about several economically unsettling events we should all be paying attention to. Real estate agents have been grumbling for months about their weak market, including the number of unsold homes and properties and the increased average time it takes to make a sale—situations influenced by the area’s overall economic conditions.

There are concerns and rumors about factory employment. One area plant apparently has been spared for now, while another may be closing because its parent has gone bankrupt. There’s talk of umpteen square feet of un-rented warehouse space begging for tenants. Some, if not all, of the area’s motor vehicle dealers say there’s been a slowdown in their sector, which is one of the reasons the granddaddy of all economic indicators—sales tax figures, for the state, city and county—dipped in the fourth quarter of 2006.

Years ago, Columbia was a one-horse economic market hitched to the wagon of the mothership campus of the University of Missouri. You looked no further than to the summer months to note the huge nosedive sales tax revenues took when Columbia reverted to its annual inter-semester siesta mode. There was little in the way of economic diversity aside from the typical retail activity of a small crossroads county-seat community and the Hamilton-Brown shoe factory, which later housed other manufacturing enterprises, including one that manufactured airplane propellers and cabinets for Farnsworth television receivers.

A major strike against us was the absence of a main-line railroad connection, but that may have been just a convenient excuse to not court the factories other communities craved. Rather deliberately and consciously, the town fathers eschewed any kind of heavy industry, which probably would have meant factories with smokestacks. The omnipresent threat of seasonal employment—with layoffs and perhaps a unionized labor force—was rejected because it would have violated the carefully chosen mission of our little “Athens of the Midwest,” as Columbia was often referred to years ago.

Thus it was an equally deliberate and diversifying departure from practice to court industry in an activity that began in earnest some 40 years ago. What Columbia has on its industrial books today is a cadre of factories and factory workers gained entirely through our own spunk and initiative, with few, if any, economic incentives.

Times and the economic market are changing not just here but worldwide. The great post-World War II expectation that the U.S.A. would remain the “world’s factory” passed by long ago. Today’s entrepreneur now chases down the absolute lowest cost of production and distribution. Today the spotlight shines on China and several other countries, but that won’t be forever. It is economically inevitable that the beam of favored manufacturing status will shift to other locales where the cost of doing business is even lower than it is in China.

In the face of this reality, Columbia’s relentless challenge—and this applies to Missouri as a whole as well—is to make it as comfortable as possible for investors and entrepreneurs to do business here as long as they adhere to our laws. We aren’t accustomed to providing incentives, but its obvious mechanisms, such as the Chapter 100 program, will have to be provided for the area to be competitive.

Statewide, there’s been some discussion about introducing “right-to-work” legislation, as provided for under the Taft-Hartley Act of 1947. Under this legislation, a state, by a simple majority vote of its citizens, can elect to exempt its workers from compulsory union membership under the closed shop provision of the Wagner Act of 1935. The last try, back in August 1980, resulted in failure. A topic for more thorough treatment in another visit is legalizing the open shop, whereby union membership is not obligatory. That would have to be the secret, unspoken wish of every one of the state’s economic development directors.

We probably can expect some good economic news in the weeks to come because the agonizing icy winter has largely faded from view. Real estate agents should have something to cheer about as longer, warmer days, coupled with the earlier advent of Daylight Saving Time, reintroduce us to being outdoors. This may spur vehicle sales; some of the winter-bashed wrecks on the road are marked for the scrap heap because they’re simply worn out.

Now, if we could only kick sales tax revenues back up, especially when they’re sure to dip for a week later this month during the annual spring break exodus.