An Economic Vision For California

With California’s economy showing signs of growth in 2013, it doesn’t mean we can all break out our party gear for 2014. As some of our most distinguished elected officials have found out the hard way, hope is not a plan for future success. We need a strategy; a sustainable economic future that goes beyond 2014 and focuses on what we can achieve in the next decade.

The one thing as Californians we all generally share in common, is that we are a hard working innovative group of individuals that given the right opportunities, our focused energies serve to change the world! California, however, has an Achilles heel.

California’s greatness lies in its economic innovation, yet its geographic diversity has resulted in significant economic challenges. Correcting this inequity needs to be part of our future economic plan. This year Milken Institute’s Summit California was an assemblage of raw talent both in the audience, as well as those participating as panelists. Milken Institute’s opening comments set the tone for its one day conference stating,

“We will together envision a state that is more vigorous and influential than ever as we define the ideas that will get us there. We’ll do so in a setting designed to turn those ideas into action.”

I am reminded flying over the Central Valley just how rich our farmlands are that help feed the world, yet there is little means to help feed its residents economically. This disparity was aptly described in a paper by the Milken Institute available at the Summit entitled “Mind the Gaps: Closing Income and Educational Disparities in California.”

The report discusses “comparing per capita income levels, which can be tied to concentrations of wealth and economic activity.” California is a very big state geographically and as such, California’s size lends itself to city/industry clusters and vast amounts of open space.

What struck me about the report is that California’s highest per capita income by county is in Marin County at $85,761, which is the highest per capita income of any state in the nation. Yet our lowest per capita income in Del Norte County (Northern California) is $27,220, while the lowest per capita income in the nation by state is Mississippi at $32,000.

What is more shocking is there are seven counties in California (which make up a large land mass) with lower per capita incomes than Mississippi. When one thinks about these statistics, it is difficult to fathom! It’s even more upsetting to know that this gap is growing, not shrinking. We need to start developing a comprehensive economic vision for California.

A few months ago I had the occasion to share an emergency row with Governor Jerry Brown on a Southwest flight from Sacramento to Los Angeles. He immediately called me out as a lobbyist (perhaps it was the suit and the fact that I had met him on numerous occasions over the years.) Before exchanging any pleasantries, he told me that he was concerned about the growing disparity between the wealthy and the working poor. He summed up his comments by saying there are too many people that make a lot of money, yet the working poor do not have enough to sustain themselves, and the gap is growing.

I told him I had a solution for the problem. He looked at me incredulously and said “You have a solution for closing the gap?” I said “Yes I do, it is called the Innovation Economy.” I further explained myself by saying that a more highly trained and educated workforce in growing industry clusters will result in substantial increases in wages and benefits, thus narrowing the gap.

This year I was invited to be a panelist at the Milken Institute Summit on the topic of “Invented Here: Sharpening California’s Edge in Research and Innovation.” I was invited in part because I founded a non-profit organization called Innovation State premised on the notion that California needs to develop an economic strategy based on our Innovation Economy.

One of the publications at the Summit noted that the tech sector is leading the charge to bring California out of our economic recession. Historically, construction has driven California’s economy out of recessionary periods, however, this is no longer the case as we work our way through bank owned properties.

Other topics at the Summit included “Creating a Business Friendlier State” and “Effective Government, Responsive Leadership.” The central objective of this year’s Summit was to create an action plan to solve problems, rather than merely discussing issues.

What makes Milken Institute unique from other organizations is their ability to attract the interest and participation of individuals who have helped build California economically and are willing to commit their time and resources for the state’s greater good.

When we think about the leaders that developed our Constitution, establishing a framework for our great Nation into what it is today, they did it through the process of collaboration. It was not always easy and there were a lot of bumps along the road, yet they were leaders who worked for the common good.

California is at a Crossroads.

We can be a second rate state that is mired in bureaucracy, or we can set a course for our future. It cannot happen without a common vision and individuals of all walks of life — from the corporate executives, elected officials and the hourly worker — to help in a common effort to improve our current circumstances. Unlike the Constitutional Framers, we are no longer establishing a government; we are trying to determine how government can work more effectively for everyone. Government should not be an impediment to our future success, they should be a partner!

The Milken Summit Conference is one example of bringing the best and the brightest together to develop ideas that help benefit the state as a whole. As with most of the innovation and growth that takes place today, it is not one person that can solve the problem, it’s a collaboration of people looking beyond what is good for them individually, and instead looking at what is important for the greater good.

We have an opportunity to bring California back to the world leader of economic opportunity it has been since the Gold Rush. Our Innovation Economy is going to lead the way.

Working together, we can make it happen. However, it starts with individuals like you, who are willing to take the time to read about California’s future.

Let’s help California and build a vision around our Innovation Economy.

Spread the word, share our message and let us know how you can contribute to our common vision.