State Just A Drive-thru For New Economy
Tuesday, October 15, 2002

By Mike Ivey

In Milwaukee this week, leaders from the state business, government and university sectors are gathering at the Midwest Express Center for Wisconsin Summit III.

Sponsored by the University of Wisconsin, the state Department of Development and a variety of corporate interests including WE Energies, Alliant Energy and the Milwaukee Journal Sentinel, the event is aimed at "moving the state forward," according to organizers.

One topic not on the agenda, however, is the state's "forklift economy."

The forklift economy basically refers to the kind of economic development that occurred during the Tommy Thompson years. Rather than fostering the kind of high-tech, high-paying jobs all business boosters dream of, Wisconsin has continued to see an erosion in its manufacturing base and a growth of low-end, service sector jobs.

Can you say Wisconsabama?

Instead of producing things of value here anymore, the argument goes, Wisconsin has become a convenient storehouse and truck route between the thriving urban centers of Chicago and Minneapolis.

With relatively cheap land, free roads and officials desperate for any kind of economic development, Wisconsin would seem perfectly suited to a forklift economy. Witness the giant Walgreen's warehouse near DeForest, the huge Target warehouse in Oconomowoc and the massive Wal-Mart warehouse near Sparta.

It's not by accident. Wisconsin made a tremendous public investment in new road construction during the Thompson years. This "build it and they will come" strategy resulted in bridge and highway spending that ran 33 percent above the national per capita average over the past two decades, according to Cathy Lawton, an independent state Assembly candidate from West Bend who analyzed the state budget crisis in a series of newsletters.

Over this same period the state has lagged the nation in population growth, gross state product and average wage rates. Income growth is now predicted to lag the nation by 22 percent through 2024.

"Wisconsin's transportation strategy of the past two decades has failed to live up to its claims and deliver on its economic promises," she writes.

So, is the "forklift economy" characterization accurate?

Don Nichols, a UW-Madison economist, agrees that Wisconsin has a long way to go to become a leader of the new economy. In fact, he quipped that the state remains so dependent on traditional manufacturing that any forklifts in use here are also probably made in Wisconsin.

"I envy Chicago and Minneapolis not for their manufacturing, but for what goes on inside their tall office buildings," he said. "High income professionals with degrees from the business school, law school, comm arts, etc., all helping to run our knowledge-based economy."

Terry Ludeman of the state Department of Workforce Development agrees. He says a pressing concern isn't so much the loss of manufacturing jobs here but rather younger people leaving the state and the inability to lure top workers or companies here.

Ludeman notes that the lack of an attractive metropolitan area has allowed states of similar population such as Washington, Minnesota, Arizona and Tennessee to move past Wisconsin in many economic categories. Meanwhile, he said the average age of workers in Wisconsin has increased to 52.

"The supermetro areas like Seattle are where you're finding the corporate offices and the technical people," he said. "These things are playing out to make it very tough in Wisconsin."

Add in the well-publicized problems facing the state's lone metro area of Milwaukee and it's easy to understand why so many business leaders here feel a need to have a summit.

© 2002 The Capital Times Co. Reprinted with permission.