were they thinking?
six coal-producing counties have sparse resources to
invest in local civic projects. With only one
representative in Congress and five in the General
Assembly, these isolated, thread-bare communities
have limited clout to reel in federal and state
funds. Likewise, they have little private wealth to
tap. Coal barons like Jim McGlothlin and Carl Smith
who scratched their first fortunes from the coal
seams of Southwest
have long since diversified their holdings and moved
away. Although both men have contributed to local
causes, they have many competing interests.
back in 1994, when local leaders mobilized to
underwrite a civic project of vital community
importance -- calling in every favor and pulling
every string -- what did they decide to build?
a law school! As if the Commonwealth didn’t
offer enough options to earn a juris doctorate at
the University of Virginia, William & Mary, the
University of Richmond, Washington & Lee, George
Mason and Regent. Somehow, the good people of
got it into their heads that they, too, wanted a
piece of the law-school action.
were they thinking? Lawyers do play a useful role --
as long as they’re not filing frivolous,
class-action shakedown lawsuits -- but was
really crippled by a deficit of attorneys? Was the
prospect of leaving the region for three years to
earn a degree really so debilitating for local
students? Could not the sum devoted to the law
school have been better invested in an institution
designed to bolster the region’s economic
do not mean to pick on Southwest Virginia. Every region in Virginia,
following the piper’s call of some civic
entrepreneur, has squandered political and
philanthropic resources on projects of dubious value
-- baseball stadiums, museums, tourist attractions,
convention centers, fine arts complexes. If people
want to justify such projects on the grounds that
they contribute to the local quality of life,
that’s their prerogative. But if Virginians are
serious about building stronger economies, they are
better off funneling resources into institutions of
knowledge creation that improve workforce
productivity or stimulate innovation in leading
communities find themselves in the desperate straits
coalfields, where mineral resources are being
steadily depleted. But every region, no matter how
prosperous, grapples with finite civic resources and
seemingly unlimited needs. Every region should rank civic priorities –- projects that would make the
greatest contribution to economic development and
quality of life – to guide its investment of
scarce civic resources.
“civic resources” I refer to funds that can be applied to building those non-governmental
institutions so crucial to the Knowledge Economy –
everything from inversities to community hospitals,
from museums to research institutes. These
resources, in my observation, can be categorized
into three types: political, philanthropic and
“political” resources, I refer politely to pork
barrel. Every member of Congress and every
representative to the General Assembly should be
good for a certain volume of pork or he’s not
doing his job. Don’t misinterpret me. I regard
pork barrel spending as wasteful and reprehensible,
but I can’t ignore the reality of
the way things work. As a rule, elected
representatives with seniority and power do a better
job of loading up the larder than do their juniors.
(Check out U.S. Representative Congressman Rick
releases -- the coalfield congressman could
teach Joe Luter at Smithfield Foods a few tricks.) But
pork is a finite resource. There’s a limit to
how much even the most diligent pork packer can loot
from federal and state treasuries.
“philanthropic” resources I mean major
contributions by foundations and, more commonly in
Virginia, wealthy patrons. Here in Richmond,
civic institutions have been blessed by the
generosity of the Robins, Gottwald and Ukrop
families as well as individuals like
William H. Goodwin. But as wealthy as they are,
these benefactors can part with only so many multimillion-dollar
course, every region can tap its citizenry for
smaller donations, and Virginians are moderately
generous. According to the National
for Charitable Statistics,
Virginians listed $3.9 billion in charitable
contributions on their income tax returns in 2001.
That amounted to 2.3 percent of their adjusted gross
income – a sliver above the 2.2 percent national
average. But those contributions went to
literally thousands of different causes including
many that are national, even international in scope.
As a practical matter, only a fraction of that $3.9
billion can be tapped for local projects.
there are municipal resources. Local governments
usually have discretionary funds they can put into local projects.
But, again, there are constraints -– resistance to higher
taxes and a ceaseless clamor for improved municipal
services foremost among them -- on how much local
governments can participate.
its political, philanthropic and municipal
resources, every community has what I call a
“civic capacity” to underwrite the creation of
new institutions or the expansion of existing ones.
In my observation, few regions have developed an
organized process for deciding which proposals best
match local needs. Typically, a handful of
super-wealthy philanthropists set the agenda based
on their personal priorities because any proposal is
a non-starter without their support. This dominance
is accentuated by a you-support-
pattern of reciprocity among the big boys.
Occasionally, a civic entrepreneur, driven by vision
and passion, mobilizes the community behind a
too often, the result is a free-for-all of too many
projects competing for too few dollars. Key
initiatives limp along for years as their patrons
try to raise funding. When projects do succeed, it's
often for idiosyncratic reasons related to local personalities and politics, not because
the community has embraced an initiative that
advances its vision for the future.
coalfields wind up with a law school and
Martinsville, a down-on-its-luck mill town,
with a museum of natural history.
of making George
a world-class center for software programming and
information technology, Northern Virginia pours its
energy into getting a $400
million baseball stadium. Instead
of developing a vibrant, participative arts scene that will lure
members of the creative class, Richmond could find itself supporting a $150
million, tax-supported performing arts center for
wrong projects often get funded because people ask the
wrong questions. Invariably, the merits of a project
are debated free from a larger context. Would it be
desirable to have a law school, or baseball stadium,
or arts complex – yes or no? Sure, viewed in
isolation, the answer is yes. But civic projects
don’t exist in a vacuum. They compete for scarce
resources. If one project is funded, then something
else is not.
need to be disciplined about prioritizing civic projects.
Local governments can’t do it -- major
civic projects tend to be regional in nature,
transcending local municipal boundaries. Chambers of
Commerce can't do it -- they are regional in scope but their business
constituencies are too narrow. Ideally, regions
should set up organizations like the Hampton Roads
Partnership or the now-defunct New Century Council
in the Roanoke Valley, with representation from a cross section of
groups and interests in the community.
partnerships then should apply the following
principles to the setting of priorities.
No community can afford to underwrite every idea
that gets some local champion jazzed. Every project must serve a
strategic goal: either building the community’s
wealth-creating potential or improving the
citizenry’s quality of life. Poor communities
should place a greater priority on creating wealth,
without which nothing else is possible. Prosperous
communities, by contrast, can afford the luxury of attending to
the quality of life. Indeed, in the competition for
members of the wealth-producing
“creative class,” some investments in quality of
life become an economic development tool as well.
little excellence beats a lot of mediocrity. There’s
always a temptation,
especially when politicians get involved, to
spread the wealth, to satisfy as many constituencies
as possible. But investing in mediocrity is a waste
of money. In a globally integrated economy,
communities must build world-class institutions
capable of attracting world-class talent and
producing world-class results.
takes sustained commitment.
It takes decades to build facilities, recruit talent, pump
up endowments and create a reputation for
excellence. In a hyper-competitive world, civic
institutions run hard just to stay even with
their peers. To gain in stature, a university,
medical facility, museum or research center must
sustain community support over generations.
If you’re looking for a quick return on
investment, build on your strengths. Stick with your
strongest civic institutions containing the greatest
concentration of managerial and creative talent.
Creative people at the top of their professions see
abundant opportunities to make a mark on the world.
Only prosperous communities, by contrast, can afford
the luxury of starting institutions from scratch and
waiting years, even decades, for the payoff.
Innovation and economic growth arise from economic
ecosystems in which people, ideas, know-how and
money cycle between knowledge-creating
institutions and business enterprises. For a region
like Northern Virginia,
home to a world-class cluster of information
technology companies, the top priority is a
into a world-class center for telecommunications and
systems integration – a Carnegie Mellon of the
South. Likewise, Hampton Roads should build on its
defense and ship-building sectors.
a region with a diversified economy, it’s a
tougher decision. One possibility might be an
Institute for Advanced Materials, playing on the
presence of the large polymer- and
specialty-chemicals industry… or, perhaps, a
Center for Medical Logistics, exploiting the
potential offered by the presence of two of the nation’s
largest medical distribution companies.
every case, the idea is to build a cluster of
businesses and knowledge-creating institutions that
can feed and support one another, creating a
critical mass capable of attracting top managerial
and scientific talent, conducting
world-class R&D, spitting out a continual stream
of innovative products, services and start-up
companies, and enhancing the wealth-creating
capacity of the region.
would this logic apply to a place like Southwest
where the leading industry, coal mining, is in
irreversible decline? Does it make sense to invest
resources in an industry which, given the dictates
of geology, may no longer exist in 30 years?
have a one-word response: Texas.
remains the global leader in the petroleum industry
despite the fact that its oilfields have experienced
dwindling production for decades. Oil service
companies that originated to support local oil drillers now ply global markets.
is home to a cluster of mining equipment
manufacturers. Virginia Tech, on the fringe of the
coalfields, boasts the largest mining engineering
department in the country. Bluefield, W.Va. -- right across the
state line --
hosts the annual Bluefield Coal Show, one of the
nation’s largest conventions displaying coal
mining equipment and technology. Virginia’s
coal production may be modest but manufacturers of
mining equipment have located facilities in Virginia
to take advantage of its favorable, right-to-work
labor climate. Numerous geological, engineering and
environmental consulting services do business in the
region as well.
coal production has leveled off in the
coalfields, it is booming overseas. Virgin coal
seams are being opened in locales as far flung as China
Tremendous market opportunities exist for companies
to export state-of-the-art mining technology, mining
management, geological and environmental services
and deal-making savvy.
that’s not all. Coal mining may be a mature,
capital-intensive business, but it’s becoming more
knowledge-driven all the time. Researchers are
developing clean-coal technologies for removing
sulfur, ash and other impurities from the fuel. Others
are developing techniques for tapping methane – an
explosive gas once vented from coal mines – and
converting it into a fuel. Who knows what other
technologies might revitalize the industry? Perhaps,
one day, remotely operated machines may spare miners
the discomforts and dangers of working all day
offense to the Appalachian School of Law, which I'm
sure is a fine institution, but churning out
lawyers does not add one whit to the wealth-creating
potential of Southwest Virginia. What
an opportunity lost! Just think what might be
accomplished if a comparably sized institution, with 20
faculty and more than 20 support personnel, instead
were developing technologies and best practices that
increase the competitiveness of Virginia's mining
equipment and services sector?
Center for Mining Machinery and Technology, or some
such entity, could serve the existing mining
machinery cluster much in the same manner as, say,
the Institute for Textile Technology in
Charlottesville helps sustain the textile industry.
Playing off the knowledge-generating assets at
Virginia Tech, such a center might encourage
developers of mining machinery to locate more
manufacturing, R&D, start-up enterprises and, conceivably, even
headquarters functions to Southwest Virginia.
time for all Virginians to think strategically about
the future of their communities and to align their
political, philanthropic and municipal resources
with their goals. Haphazard and uncoordinated
initiatives will yield haphazard, uncoordinated
results. Mobilizing civic resources behind carefully
chosen projects will pay rewards long into
-- October 6, 2003