WisBusiness: Final economic summit session finds participants still searching for consensus

MILWAUKEE — Wisconsin business, academic and municipal leaders aren’t necessarily buying a “strategy for prosperity” that focuses on creating clusters of industry aligned with the state’s biggest cities and universities, and which revolves on a premise of reversing “brain drain.”

And one large Wisconsin employer laments that the health care industry is under-valued and seen as a “necessary evil” rather than an economic boon.

One after another, panelists and attendees of 2010 Wisconsin Economic Summit’s final session on Tuesday politely but bluntly called for more government assistance, not less; more attention to communities and schools outside Milwaukee and Madison; and a re-examination of the “brain drain” theory.

“The public thinks we’re losing our best and brightest Wisconsinites, and that’s not true,” said Richard Wells, chancellor of the University of Wisconsin-Oshkosh. “That’s what bothers me.”

Meanwhile, keynote speaker Nick Turkal, president and CEO of Aurora Health Care, which employs more than 30,000 Wisconsinites, said, “I want to change the dialog. When it comes to economic development, I want health care to get some respect and be recognized as an economic engine for this state. No one seems to want to address that. We are key in providing jobs. but elected officials want to talk about health care only in terms of cost or as a drag on the state.”

Tuesday’s event at the Wyndham Milwaukee Airport Hotel and Conference Center was the third and final session of the 2010 Wisconsin Economic Summit Series, hosted by the University of Wisconsin System, Competitive Wisconsin, Inc., the Wisconsin Technology Council, the Wisconsin Way and the Wisconsin Higher Education Business Roundtable.

The first session, “Creating the Economic Vision,” was held Aug. 2 in Appleton; Session 2, “Managing the State Deficit,” took place Aug. 26 in La Crosse.

Tuesday’s event, billed as “Moving Wisconsin Forward,” discussed an exhaustive list of goals and recommendations compiled by a two-dozen member planning group. The “Wisconsin Prosperity Strategy” — to be presented to state lawmakers in November as they hammer out the state budget — urges Wisconsin to enhance its existing “clusters” of success, such as papermaking, cheesemaking and biotechnology, and to “align” educational programs from “pre-K to gray” to the skills and knowledge needed by those industries.

Other goals include:

* Creating a $1 billion fund for matching investments focused on innovative technologies and start-up companies.

* Proactively seeking government grants, while including a “lock box” clause to prevent politicians from raiding the funds for other purposes.

* Creating a Lean Government Commission to replace the Department of Commerce.

* Developing “driver” products to be exported globally.

* Expanding mentor programs for entrepreneurs.

* Providing access to venture capital with state-seeded funds.

* Investing in statewide infrastructure, including nuclear, wind and solar power, extending Internet and cell phone service to unserved areas, and installing rail service to connect university campuses and major cities.

Gubernatorial candidates Scott Walker and Tom Barrett addressed the summit at separate times during the day. Walker said he would push for tax cuts for small businesses and supporting infrastructure investments, if elected. Barrett also pledged to cut taxes, offer state-seeded venture funds and hire an economic development director.

Summit participants, which included municipal officials from across the state, as well as representatives of educational institutions, asked no questions of the candidates. They did, however, ask pointed questions of panelists and summit organizers.

East Troy Town Chairman Joseph Klarkowski inquired why government funding programs typically bypass rural towns in favor of cities. Some businesses, by their nature, are not suited for urban areas, he said, yet provide jobs and contribute to the state economy.

Lee Rasch, president of Western Technical College in La Crosse, said the state should take a more regional approach toward economic strategies, “because La Crosse is different than Milwaukee.”

“We’ve talked about pinpointing education and economic goals — does that include technical education?” asked Ed Lukasek, a Sparta alderman and board member at Western Technical College.

Wells, of UW-Oshkosh, says the concept of “brain drain” is misunderstood. “When you look at the UW System, our alums stay here at a rate higher than the national average,” he said. The real problem is a lack of “brain gain,” or attracting students from other states to attend school and make their careers in Wisconsin, he said.

Dick Skare, who is running for a seat in the state Assembly’s 1st District, said despite talk of supporting small businesses, there’s not enough help for companies that lack human resources professionals and accountants with the expertise to land small business loans. He and his wife run a restaurant in Door County that employs 67 people.

Skare also challenged the assumption that access to health care is “near universal” in Wisconsin.

“We may have a Lexus of health care in Wisconsin, but we can’t even rent the car,” Skare said. “That’s a huge issue. In terms of an economic stimulus, if you had people able to have health care without it being related to a job or whether they’re retired or not, so many things could open up. It’s like maybe having that Lexus and never changing the oil or filter. Eventually, that thing’s going to go bust on you.”

But Turkal said the public doesn’t realize how far hospitals like Aurora have come in recent years to streamline operations and lower costs. “I’m sure everyone remembers reports from a few years ago that said Milwaukee health care costs were 55 percent above the average in the Midwest,” he said. “What doesn’t get covered is the progress that’s happened in the intervening years.”

By trimming supply and labor costs, and using lean management techniques, Aurora has slashed $350 million in operating expenses within the past four years and brought costs within the Midwest average, Turkal said. He said Wisconsin should lobby for better Medicare reimbursement, which, he said, is disproportionately low compared with other states like Florida and Massachusetts.

A panel of academic professionals called for changes in binding arbitration and the ability to impose changes like longer school days to improve education in the state and rein in runaway costs.

“School boards would like the option to move teachers into the state health plan,” said John Ashley, executive director of the Wisconsin Association of School Boards.

“We need immediate strategies. We can’t be retiring public school teachers at age 55,” said Patricia Herdrich, superintendent, West Bend School District. She said schools need to expand curriculum, not cut it, if Wisconsin hopes to compete globally.

In the Asian bloc, children are learning a foreign language at age 2. In the European bloc, kids are proficient in three or four languages by the time they graduate, she said. “Here, we are arguing whether or not 4K is a good idea and whether two years of foreign language should be required to graduate.”

Wisconsin will never solve its problems by making too many budget cuts, said Rolf Wegenke, president, Wisconsin Association of Independent Colleges and Universities.

“You don’t cut your way to prosperity, you grow your way to prosperity,” he said.

— By Kay Nolan

For WisBusiness.com