Thursday, August 26, 2010

Does Michigan Suffer from the Africa Problem?


Commentary – See All Commentary

By Mr Sig

Being away from Michigan and trying to find a compelling excuse to give up my great life and opportunities here and move back home has been quite a challenge.  Over the months that I’ve been away, I’ve been able to blather on about the many reasons that the economy in Michigan is simply not friendly to new businesses or new residents.  Many posts on this blog have explored some of the reasons, mainly from a free-market perspective.  However, I often find myself questioning whether or not there is hope.

Let’s look at Africa.

Africa is absolutely beautiful.  Aside from horrible violence and exploitation, movies depicting Africa show it’s breathtaking landscape.  So do the new Windows 7 wallpapers with the Africa theme!  I remember some of the World Cup commercials declaring that South Africa is the most beautiful place in the world, encouraging many people to visit.  In addition, Africa has an enormous amount of natural resources.  And while the United States seems to be focused on colonizing the Middle East, the Chinese are starting to take note and are buying up swaths of land in Africa.  The continent is home to minerals, plant life, and agriculture.. some of the best in the world in all categories.  Africa is also blessed with just about every single climate possible in the world and has an outrageous amount of costal territory making it a prime place for international shipping.  Despite all of these benefits, the continent has been mismanaged so poorly and for so long that it seems that we’ve all been given up on the place.  Every now and then, a celebrity will go over there and pose with some poor-looking children, but come on, folks, is any permanent “good” change ever going to come to that continent?  In the last 50 years, we’ve seen that major overhauls of some countries can eliminate one evil only to lead to another.  We saw the white ruling class in Zimbabwe ceding control over the country and that only brought Robert Mugabe.  We saw apartheid end in South Africa, but the country remains riddled with corruption and hasn’t made much economic progress.  It’s been hundreds of years and it’s hard to see things ever getting significantly better over there.

Is Michigan the same way?  True, we don’t have the permanent history of consistent failure in our past, but has poor management and corruption embedded itself too deep in the culture of Michigan’s managers that there is no escape? I mean, seriously, folks.  Michigan, like Africa, has an incredible base of resources.  We have incredible amounts of fresh water, a climate that shows all 4 seasons, and physical beauty.  In addition to aesthetics, Michigan has an international border with Canada.  It has a highway system that connects nearly all our major cities with Florida and Mexico making it well placed to export many of the products we produce.  It has many top notch undergraduate colleges and some of the best graduate programs in the world in Michigan and Michigan State.  Michigan’s sports teams (with the exception of the Lions) produce excellent results keeping us well fed with several national championships every decade.  The Wolverines, Spartans, Grand Valley State in college and the Tigers, Pistons, and Red Wings in professional leagues churn out championships and late playoff runs with regularity.  I’d put Michigan’s sports portfolio up against that of any state.  So why is our economy terrible?  Why is it that Michigan never got invited to the booming (albeit fake) economy (albeit fake) that existed in the middle of Bush’s term?  We simply kept being terrible while the rest of the country prospered. Sure, we can point to governing policies, a poor business climate, and corruption, but can these things be changed?  Is blaming Michigan’s problems on poor governing the equivalent of blaming gravity for plane crashes?  For centuries, Africa has not improved since bad people continue to control the country.  At least Michigan affords us elections where we can elect our officials, but the people in the state continue to accept economic failure by accepting poor governance.  Detroit’s former Mayor is in prison right now.  Flint almost recalled their second mayor in the past decade who resigned before he could be thrown out.  And even he is a convicted felon.  Who is going to take the leadership and root out the corruption and reinvent Michigan?

I do believe that Michiganders will continue to elect idiots, and Michigan will continue to be a poor place to invest for many years mainly because the smart and capable people simply don’t want to be politicians.  However, I DO NOT believe that Michigan will suffer from the Africa problem for one big reason.  But that… is for another post.  Any guesses?

I know that nobody ever wants to say that a place is hopeless, but honestly, what do you think will really make Michigan a more friendly place to invest?  Do you really think that the state will ever elect leadership at local and state levels to make that happen?  Really?  Or do you think something or someBODY else will happen / arrive that will turn things around.  What specifically do you think that will be? Or is it going to be a gradual process of the jabronis in charge either changing their minds, retiring, or dying off?

1 comment:

  1. One difference between Michigan and Africa is investing vs. charity. Too much charity can make slowdown economic recovery, since a handout is easier and cheaper than production. Luckily, I think Michigan is mainly angling for investment instead of charity (aka stimulus).

    In terms of what will make Michigan friendlier for investors, there are a few things that would help. Top of the list would be getting rid of the Single Business Tax. I do have some hope in Rick Snyder. Hopefully he'll make Michigan more business friendly. Since he funded his campaign mostly himself, he doesn't have to play to the special interests. However, a governor alone can't change a state.