Columbus Dispatch on Ted Strickland: New man, new plan

Strickland says Ohio’s economy needs to break some bad habits

Sunday, March 11, 2007
Mark Niquette
THE COLUMBUS DISPATCH
[Remember to click on images to enlarge]

Growing up along the Ohio River in southern Scioto County, Gov. Ted Strickland used to tell Kentucky jokes.

Those days are long gone.

"We can’t tell Kentucky jokes anymore because in some very basic, fundamental ways, Kentucky has moved well ahead of Ohio educationally," Strickland said.

In fact, whether it’s job growth, housing starts, bankruptcies or many other key economic indicators, Ohio continues to rank near the bottom, a Dispatch analysis shows.

This week — the most important so far of his fledgling governorship — Strickland will use his first State of the State address and first two-year budget to lay out his approach for turning around Ohio.

In an interview, Strickland declined to specify what he will propose in his speech Wednesday and his budget a day later.

But he said the most important tonic for Ohio’s economic ills is better education, and that his speech and budget will begin putting "stakes in the ground" showing bold changes, from early childhood education through adult worker training.

"The question, I think, that faces me as governor and faces our legislative leaders and the people of Ohio is: Are we going to continue to tolerate this state of affairs, or are we going to be willing to make some rather significant changes from what we’ve been doing in the past?

"We cannot continue doing what we’ve been doing, or we will continue getting the same results we’ve been getting. It’s as simple as that."

Although the state’s economy showed some improvement last year in per-capita personal income growth and certain other measurements, it slipped backward in other categories, federal and state data show.

Consider job growth: Ohio lost 22,400 manufacturing jobs from January 2006 through January 2007 and lost 16,600 jobs overall during that period. Only Michigan fared worse.

Strickland, 65, campaigned last fall on a platform promising to "turn around Ohio" by improving the state’s economy and job prospects.

The new governor isn’t promising a quick fix and says progress has been made. But he’s convinced that a different mind-set with a longer-term focus will help the state rebound from years of decline.

"In the short term, I think these numbers are difficult to change dramatically," Strickland said. "But I think that, without attempting to be critical of past behavior or past decisions, what these numbers show is that we’ve got to begin to think beyond the next year or the next budget cycle."

Economists point to a number of reasons for Ohio’s economic malaise, many of which they say government can’t do much about.

Ohio can’t improve its weather, for example. And changes in the global economy have affected manufacturing nationwide, hammering blue-collar states such as Ohio.

Because Ohio relies so heavily on automotive jobs in particular, and the domestic auto industry continues to downsize and sputter, the state has been slow to pull out of the 2001-02 recession, said Michael Nipple, an economist with Global Insight, an economic research and consulting company.

The fact that the state’s population growth ranked 45 th in the nation, adding a meager 7,300 residents last year, makes it difficult for service industries and other sectors of the economy to compensate for manufacturing weakness, said Lisa Schulkind, an associate economist at Moody’s Economy.com.

Moody’s Investors Service, a major bond-rating service for investors, recently downgraded Ohio’s economic outlook from "stable" to "negative," in part because the 2005 overhaul of the state’s tax code designed to improve Ohio’s business climate has reduced tax revenues.

Still, Strickland’s approach is encouraging, said Rick Yocum, president of the Ohio Public Expenditure Council.

"It’s a crapshoot what impact he’ll have," Yocum said. "The important part is it’s obvious this administration understands Ohio needs to move and Ohio needs to move quickly to create jobs and create economic development."

Strickland’s goals are for job growth to at least equal the national average by 2010 and for per-capita income to pass the national average by 2015.

Last year, Ohio’s job change was a negative 0.3 percent compared with 1.6 percent growth for the nation, while the state’s per-capita personal income level hasn’t exceeded the national average since 1979.

Strickland acknowledges that government can’t wave any magic wands but thinks that addressing fundamentals such as education, health-care costs and worker training can make the state more inviting for growth.

For example, he said it is "unconscionable" that state government allowed Ohio’s college tuition rates to skyrocket in recent years when the state needed more educated workers.

"The economy has changed dramatically in recent years, and if there’s any fault to what brought us to our current state, I think it was and it has been a lack of recognition in that coming change and its potential consequences on our state," he said.

"I think some other states had more foresight, engaged in activities and planning and efforts that have put them somewhere ahead of us, and so we’ve got some catching up to do."

mniquette@dispatch.com
---