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Monday, August 22, 2011

Missing the cut

Portland's "cluster" strategy for attracting business has quite a way to go before it makes a list like this one.

Comments (6)

What? Just because Portland's biotech "cluster" is in Florida....

Kind of odd that they cite Asheville, N.C., for its 10 breweries while noting that it "can't compare with the 40 in Portland, Ore."

Ogden Utah beats us for outdoor sports? I thought performance clothing was one of those targeted industries. Overlooking the fact that Nike and Adidas are HQed here.

I thought we were the leader in everything. Well, I guess the Wall Street Journal forgot to call the NY Times for it's inside connections to Portland that drips with Portland love. It all just PR.

Oregon is just unfortunate being sandwiched between Seattle and the Silicon Valley. These 2 cities pretty much suck up any talent the Silicon Forest hungers for. The sheer amount of tax brakes and bennies towns like Pleasanton, CA (where my paternal side lives) are part of the reason why Silicon Valley existed in the first place and continues to exist. It is cheap to do business in Pleasanton, CA. So cheap in fact that it ameliorates the cost of being headquartered in California.

Also, what incentives does Sam Adams and Oregon give to technology companies to relocate to Oregon?

Reading the article, I can think of a few things why all those cities are industry hotspots:

1. Influential politicians in DC (Oregon used to have influence with Packwood and Hatfield, but now...)

2. Low cost of doing business = low tax rates not only in terms of corporate, but for corporate workers in low property taxes, no third income tax if any state income tax at all, and a low if non-existent capital gains tax rate.

I could be dead wrong on this point. Please correct me if I am.

3. Politically conservative State Politics

Utah, Texas, Missouri, Tennessee, North Carolina and Indiana all have both houses of their state legislature dominated by Republicans.

Pertaining to New York, the Republicans from 1932 to 2008 held a majority in the New York State Senate. Democrats got control of it in 2008, but 4 of their own refused to caucus with them before the term began. Republicans regained a majority in 2009.

The article points out a trend I have been observing for some time:

Big business goes where it is cheapest now and in the foreseeable next 2 decades to do business. This means states where Republicans have at least a majority in one of the state legislative chambers to counter any fringe, loon left-wing initiative by state Democrats.

States like Oregon and California are not seeing these hotspots because our Democratic controlled state legislatures are too eager to nanny state trail blaze and make a reputation for themselves as the nuttiest, loony state leading these businesses not to relocate because they foresee potential increases in the costs of doing business.

Cluster strategy? That explains the "cluster" that it is.

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