The real lessons of Plasan

Vermont’s pro-business community couldn’t hardly wait to score a cheap political point (and, as usual, soil the state’s reputation) after Plasan’s announcement that it was relocating to Michigan. Decent interval, bah: we’ve got a boilerplate press release ready to go.

Lt. Gov. Phil Scott did the honors for the VTGOP, offering a quick word of sympathy to Plasan’s workforce and then pivoting to the red meat:

This announcement is yet another clear sign that we in Montpelier must put our full focus on not only protecting, but on growing Vermont’s economy and face the reality that we are competing in a regional, national and global marketplace. We cannot continue to blame “forces beyond our control” for our job losses, but turn the mirror back on ourselves and ask ourselves: “What can we do to change the direction of this trend? How can we make Vermont better?”

The best part is Scott’s dismissal of “forces beyond our control,” when Plasan made it abundantly clear that Vermont’s business climate had nothing to do with its decision, and Vermont couldn’t have done anything to change it. But let’s not let a little inconvenient truth get in the way of a stale talking point.

Former Wall Street supremo Bruce Lisman kept it simple; he made time for one self-congratulatory Tweet, with nary a word of sympathy for the workers.

(The link is to WCAX’s story about the Plasan closing.)

Nice, Bruce. Way to show your concern for the common folk.

Okay, so the Usual Suspects reacted in the usual way: grabbing at any available pretext for regurgitating their political cud. (Please chew with your mouths closed.) But there are lessons we can learn from the departure of Plasan and other industries, and things we should bear in mind.

FIrst, let’s re-examine the unique strengths of Vermont. We do have our share of weaknesses, even if you omit the tired bromides of rightist politicos. So why do so many businesses establish themselves here or move here? Why does anybody stay? Why don’t they all move to Michigan or Texas or Mississippi?

Quality of life must be near the top of the list. Our topflight public school system is a draw. We have some very nice cities and small towns, good places to call home. Low rates of violent crime. Abundant recreation. A market small enough that entrepreneurs can gain a foothold before venturing out into the big time. (Ben & Jerry’s would have had a much harder time starting out in a big state with big distribution systems.)

I’m sure there are others. My point is, before we try to tear down Vermont, let’s figure out what we’re good at, do what we can to make it even better, and market the hell out of it.

Okay, so now: what are our weaknesses?

We should certainly review the items on the VTGOP hit list. If there are ways to smooth regulatory pathways without selling our souls, great. If forms or bureaucratic procedures are cumbersome, simplify them. But there’s no way we can compete with bigger states or other countries on things like taxes and incentives. Vermont can’t come anywhere near the packages being offered by New York state, for instance. We can’t be as low-tax as Florida or as development-friendly as Arizona, nor would I want us to be. That’s why our first priority should be identifying and maximizing our strengths.

Beyond the usual GOP talking points, I see three major areas that are drawbacks for Vermont’s business climate. In no particular order:

The high cost of post-high school education. It’s the one thing we consistently hear from business owners (as opposed to their political mouthpieces): “We can’t find enough skilled workers. We can’t fill available jobs.”

The cost of attending our public colleges and universities is absurdly high — especially at the community college level. Governor Shumlin has done some incremental things to nibble away at this problem, but has failed to tackle it in a thorough, systemic way.

Getting around. When Chris Graff wrote his memoir a few years ago, he ranked the top stories in recent Vermont history. His pick for #1: the coming of the interstate freeways. They made it possible to travel and transport goods much more quickly, at least in certain corridors. They brought dramatic change to Vermont — mostly for the good.

But large stretches of Vermont are still remote — or remote enough that it’s a significant competitive disadvantage. The biggest obstacle for places like Bennington and Rutland is the lack of high-speed roadway. The best thing we could do for them is turn U.S. 7 into a freeway. We could also use speedier corridors across central and southern Vermont.

(We pause while liberal readers gasp for breath.)

Also, and just as significantly, we need more public transportation. This is a tough nut to crack in a place with a small, scattered population, but if it was easier to get around Vermont without a car, it’d help convince people to live somewhere besides Chittenden County.

The lack of housing, for purchase and rental. One of the biggest drags on our economy is the aging demographic. What do young families need? Rental properties and small- to mid-sized houses. Just what we don’t have.

This is one area of regulation that needs to be loosened in a targeted way. We need to do more to encourage affordable housing — by which I don’t just mean Section 8 or mobile homes, I mean houses costing less than $250,000 and enough rental stock to keep rents reasonable. I’d like to see an emphasis on in-fill housing in existing cities and towns. I don’t want to open the regulatory door to more suburban sprawl.

Housing affordability touches on a fundamental problem with our 21st Century economy: wage stagnation in the middle and working classes. Part of the problem with affordability is depressed wages, something that’s beyond the scope of this post. But as long as young people are starting their lives with college debt and low salaries, we need to help them find housing that fits their budgets.

So there you have it. My initial prescription for improving Vermont’s business climate. And it has nothing (much) to do with taxation or regulation.

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6 thoughts on “The real lessons of Plasan

  1. Elizabeth Templeton

    I beg to differ on your characterization of our public school system as “top flight”. It is, in some places. But if “top flight” means doing the best you can without experienced faculty and modern teaching resources, then you’re covering up as much as the right-wing and left-wing pundits are. Read today’s VT Digger’s report on teacher hiring problems in poor rural schools.

    Reply
    1. John S. Walters Post author

      Generally speaking, Vermont’s public schools rank near the top. You’re right, there are problems in rural areas; but if new business growth happens, it won’t be in the remote areas; it’ll be in places with good schools.

      Reply
  2. kevin ellis

    All good things…but I would submit they have been examined and studied ad nauseum, written up in reports and discussed endlessly…Speaking as a D and a lobbyist PR consultant with lots of frustrated business clients (or clients that never even appear), the permit process is way, way to slow. You can keep your soul and do this better. I dont think Act 250 is generally the problem…it is a cultural difference between regulators and applicants…A hard charging applicant who mde big money in Silicon Valley or CT. wants to buy an old ski area and turn it into a private club for his private jet friends…Distasteful to many, but low impact for the most part and lots of taxes to be paid to the host towns…but the gulf between regulator (“You should have come to us and worked all this out ahead of time.”) and applicant (“Why can’t the governor just issue an executive order as they do in other states?”) is so wide that the project runs aground, hurting the town and worst of all Vermont’s reputation. Bottom line is that Vermont is split on these issues. The liberal arts refugees who arrived in the 70s and took over state and town government don’t want development. They came here with kayaks and hiking boots from NJ (my home state) for a reason. The new tech entrepreneurs in Burlington’s South End don’t get that. It is that split that creates the paralysis.

    Reply
    1. John S. Walters Post author

      Good thoughts, Kevin. There’s a paralysis surrounding development and land-use issues because the left instinctively mistrusts anyone calling for loosening the reins. I think we both agree a thoughtful, measured approach is possible and desirable.

      Reply
      1. kevin ellis

        But it is always the next step that is the hardest…we agree on a path forward but WHO leads? A deep conversation – or post – about the governor’s role here.

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