Downtown Spokane now under continuous police video surveillance

Security camera at London (Heathrow) Airport. ...

Image via Wikipedia

Local News | Much of downtown Spokane under surveillance | Seattle Times Newspaper.

Yes, we have to catch those dangerous photographers using – horrors – tripods!

Hard to believe but in Spokane, you must apply for and obtain a permit before anyone, including students and individuals doing non-commercial still or video photography, may use a tripod upon any sidewalk or street in the City of Spokane. Read more of this post

Spokane’s low wage problem noted again

The Spokesman Review’s business blog notes:

“Cost of business in Spokane was 81 percent of the national average, Coeur d’Alene’s was 76 percent.

In cost of living, Spokane was 97 percent of the national average, Coeur d’Alene was 96 percent.

Among Spokane strengths, Moody’s says, are the diversity of industries and stable military and health care sectors. A negative is the unfavorable cost-to-income balance.”

via Spokane recovering, Kootenai County still in recession – Office Hours – Spokesman.com – Aug. 31, 2010.

The cost of doing business in Spokane is low due to the low wage problem of the area. That is a benefit to a business but a cost to workers.

T-Mobile expands high speed wireless to Spokane

Via Twitter:
techsavvy: T-Mobile expanded its HSPA+ to Boston, MA; Erie, PA; Fresno, Palm Springs, San Diego, CA; Miami, FL; Richmond, VA; Spokane, WA.; Topeka, KS.

The HSPA+ technology is about one order of magnitude faster wireless data than commonly available today and is also known as “4G” technology. According to T-Mobile, the new services is available immediately.

Spokane’s First Apple Store takes shape

Source: Yfrog Image : yfrog.com/nfpmaj – Uploaded by mtigas.

Apple began opening retail stores 9 years ago, in 2001. Their first store is slated to open in Spokane in the Fall of 2010.

Economic development experts say Missoula efforts deficient, need reorganization

From the Missoulian newspaper:

Missoula’s economic development efforts are woefully deficient, dysfunctional, ineffective and without direction or leadership, a pair of economic development experts from Atlanta told local business leaders Tuesday.

via Economic development experts say Missoula efforts deficient, need reorganization.

An outside group of consultants reviewed the city’s economic development agencies by pretending to be looking for a site to open a business in Missoula. They learned that economic development in Missoula is a mess.

I wonder if we’ve ever done a review like that here in Spokane?

This is pretty neat

Spokane – Interceder: real time news. It’s a web site that displays a list of headlines in near “real time” from multiple sources in the Spokane area, and beyond, if the story has some connection to Spokane.

National name-brands in Spokane?

Spokane has more of a small town economy feel.. not up to date with corporate america, seems to be primarily divised up of private owned small business, it just doesnt have many large employers.. looking at boise you have Micron, Hewlett Packard, URS, Winco Foods, Simplot, New Albertsons, etc. Ugobe, a robotics resaerch company based out of the bay area california just built a facility near boise. many silicon valley high tech firms are considering relocationg here, there are no nationally recognized companies in spokane.

via City-Data Forum – View Single Post – Boise vs. Spokane.

Actually, there are a few name brand companies in Spokane, but they are not well known consumer brands. Itron, which builds electric power meters, and Hollister-Stiers, which does contract pharmaceutical manufacturing used to make the Ana-Kit, similar to the Epi-Pen (they sold the manufacturing rights to another company). Or Telect, which makes communications industry products – although both Telect and Itron have most of their employees located elsewhere. Sterling Savings has banks along the west coast and just completed a successful de facto bankruptcy, raising $730 m and nearly wiping out existing shareholders. DISH Network runs a satellite uplink outside of Spokane, but its only about a dozen workers. B.F. Goodrich makes commercial airplane tires, also just outside Spokane. Kaiser Aluminum still runs the rolling mill in Trentwood. PAML, a medical lab, is in the midst of a major expansion into other states. (I am not including firms like Avista or Qwest because every place has a utility and a phone company.  Gonzaga University is also a bit of a “name brand”, certainly in the Northwest.

OneCall.com and Purcell Systems are two more. Red Lion Hotels is based out of Spokane.

Sterling International’s RESCUE -brand insect traps (around here, think yellow jackets) are made in the Spokane Valley.

The really large employers are government (lots!), health care, especially Sacred Heart Medical Center, Inland Northwest Health Services, Deaconess Medical Center, … well, government and health care.

Beyond Itron and the above, its mostly lots of small to mid-sized businesses. Which the locals will spin as a benefit of a “diversified economy“. We wouldn’t want to have large employers like, say, Boeing, Paccar, Safeco, Microsoft, Amazon – wouldn’t be diversified!

Some well known name brand companies that left Spokane recently – Kaiser’s Mead Smelter (bankruptcy/closure), Agilent (closed), General Dynamics/Itronix (closed), Egghead Software (bankrupt), Metropolitan Financial (bankrupt), ISC/Getronics (bought out, later offshored, now gone).

Nothing on this web site is original

As you can see from comments to the Spokesman-Review articles, like this one, many people in Spokane understand the situation of its long struggling economy. That comment is pretty much on the mark and makes a very good point – Boise, which has long been the “comparable” city by which both cities compare their performance, has continued to thrive while Spokane has stalled. That is also seen in Spokane Airport handling more passengers in 1996 than in 2009, while Boise passenger traffic has grown nicely since then.

You can also see on that comment thread what happens to people who dare question the status quo – geesh! Dissenting perspectives, especially on public policy issues like economic development, are not tolerated in Spokane, as EWU’s study on Spokane’s culture learned.

——–

I also saw mention of some of the issues that seem to limit forward progress in Spokane:

  • The culture issue is mentioned
  • Does “old money” (there is plenty here) play a role in preserving their status quo?
  • Surprisingly sharp attacks against anyone who mentions any problems in Spokane. That suggests a closed mindedness at work that limits progress. Mere mentioning a problem here results in a call to “Get the hell out” of Spokane. Wow.

History of Spokane Economic Plans – Part 8 – Recommendations

Mayor Newsom announces the first microloan of ...

Image by mayorgavinnewsom via Flickr

(Photo is not of Spokane but San Francisco upon the announcement of the issuance of “micro loans” to help start small business economic activity. Photo is an official photo of the SF Mayor’s Office.)

Recommendations?

There are only a few recommendations I could think of that do not appear in a prior study. And I am not going to repeat the long list of ideas in those studies-I especially liked the 2003 Innovation Economy report.

  • All of the historical plans repeat themselves year after year. That suggests their goals were unrealistic as they were not met – and just get repeated again in the next report. The Focus 21 study even acknowledged that all the reports are basically the same,  filed away on a shelf, and rarely looked at.
  • Future reports, and you know there will be many more, should be short (the 2003 Innovation Economy report is around 200 pages!), direct, and nail the main points.
  • Agencies and the consultants they hire measure their success by the number of reports they produce. Study authors should be given the responsibility to follow through with the recommendations and be held accountable for that follow through. No one is  accountable today.
  • None of the studies ever asked, “Could there be problems with clustering?” I believe the clustering focus has benefits to those areas that already have successful, strong clusters (like Seattle) as it tends to solidify what they already have (financial success). Clustering tends to be bad for the economically weaker areas as it tends to pour concrete over their existing economy, solidifying it in place forever.
  • Spokane’s cluster strategy is incoherent, changing clusters from year to year and  even month to month.  Promoters seek the benefits of tight knit, interactive clusters, but then define a geographic cluster covering tens of thousands of square miles.  Then they argue our diversified, non-cluster economy is a benefit – so why pursue clusters? Local promoters push clusters that are at odds with the State – which has cut support for clusters that local promoters are pushing. The strategy is nonsensical.  This is not a topic where being “adaptable” and quickly changing directions is useful as it discourages the investment needed to make a cluster come into fruition. The current cluster strategy – which is nonsense – may even be harming the local economy.
  • Spokane needs the presence of a research university. As the second largest city in the State, one would think Spokane would qualify. The lack of a research university has long been noted as a problem.

    “Spokane is not at the forefront of higher education. Lack of a major research institution has consistently been called a weakness as community officials assemble a 21st-century information-based economic curriculum.”- Bert Caldwell, Spokesman-Review newspaper.

    WSU-Spokane does plan to grow its presence in Spokane, but focused on health sciences and not as a comprehensive research institution. A graduate research institution provides several benefits, including attracting ambitious people to the area who wish to push their own knowledge limits, providing personal growth opportunities for those already here, and creating new leaders for tomorrow.

    The best technology transfer program comes from the students themselves, not from government agencies set up to create university technology transfer (SIRTI).  We need undergraduates and graduate students who pursue their own entrepreneurial instincts to turn great ideas into even better ideas. Unfortunately, this is form of technology transfer is weak here.

  • Do online social networks have the potential to change the concept of a local geographic cluster? I wish but I fear the consequences: If social networking enabled us to create a network cluster between the Tri-Cities and Spokane, then why not between Bangalore and Spokane? Since Bangalore is cheaper, why not just Bangalore? (That’s in India if you didn’t know.)
  • I have introduced the observation that Spokane has become the “haves” – government/education/health care workers, and the “have nots” which is most everyone else. I sense that those employed in high paying secure jobs do not understand what this fuss is about as they are insulated from the real world. I have even heard some government employees mention, recently, that they had not even noticed all the empty buildings and for sale/for lease signs throughout the area.

The 2003 Innovation Economy report has a long list of recommendations, many of which make much sense – such as locally run entrepreneur boot camps (we did that here long ago), more calls for university research/private industry collaboration, a focus on “innovation” and fostering the elements needed to create an “innovation economy” and so on.

People are the raw resource for an innovation economy. But we’ve lost a huge number of them in recent years and our universities, no matter how good they may be, are not now producing sufficient quantities of graduates and post graduates skilled in the necessary 21st century innovation economy skills. We’ve lost the critical mass needed for a tech ecosystem but we still pretend we can be a world class center of excellence in tech. Hello? As documented on this web site, EWU produced one MS in computer science in 2008, and three MS degrees in biology. We have a long way to go to reach a critical mass in the innovation economy that can compete on a national or international field.

Spokane’s economy is in retreat from its past goals – and seems to be settling in to a long term economy based on government/education, health care, retirees, and the services needed to support them.

Even Apple Computer seems to have recognized this, opening their first ever store in Spokane, in the Fall of 2010. Their strategy is to locate first where there are large college student populations, and second, where there is a large older population that is retired or near retirement. I didn’t know that was a target demographic.

Epilogue:

This concludes my roughly 2 years worth of hobby research and transcribing those notes to the web. There will be more posts in the future, but doubtfully as lengthy or as in depth as these comments have been.

Good news – some companies that moved offshore coming back

Business & Technology | More U.S. businesses abandon outsourcing overseas | Seattle Times Newspaper.

The savings turned out not to be what they had hoped for, as well as other problems. Let’s hope this results in some work coming back to Spokane too!

Yet another set of centrally planned clusters for Spokane!

This Spokane industry cluster report is freshly harvested in 2009. It suggests we focus on “Five Vital industry clusters”:

  1. Manufacturing – “Manufacturing is expected to outperform both national and state growth rates. “.  (Reality – one third of manufacturing jobs lost during the past decade)
  2. Health care (Reality – true!)
  3. Construction – “The outlook for commercial construction is good” due to growth in government stimulus spending. (Reality – practically on its death bed.)
  4. Transportation/Warehousing. (Reality – this is doing well – its trucking and warehouse distribution)
  5. Business Services – they get this one right – “Jobs may not come back to
    pre-recession level due to credit/mortgage re-structuring and emerging technology. However, even with loss of jobs replacement needs will need to be met
    “. (Reality – Many of the of the jobs are things like receptionist and admin assistants.)
  6. Oddly, their FIVE cluster list has SIX CLUSTERS! “Clean energy/Green jobs” – “It is anticipated that the emerging Clean Energy discipline will become a well defined cluster in the future“. (Reality – oh stop your laughing)

Can you spot the technology and bioscience innovation clusters on the list?

Now compare to the 2005 list of clusters:

“…financial services, advanced manufacturing, logistics, information technology, health and biomedical, and higher education and research and development.”

The 2nd largest employer in Spokane – government – appears on neither list. Go figure.

GreaterSpokane, Inc pushes Spokane as a great place to locate a technology business – yet by State law, technology businesses will not be supported by the State’s local higher education institutions, and several tech related agencies were shut down in Spokane between 2005 and 2008.

These top down, centrally managed cluster lists change constantly. The only consistent cluster, besides government and health care, seems to be the production of economic cluster strategies.

Spokane’s cluster policy is inconsistent and incoherent to the point of causing confusion that likely causes harm to the local economy.

One Third of Spokane GDP is Health Care Related

“Health care is huge in this region; about a third of the GDP (gross domestic product) in this county and a quarter of the employment is health care related,” describes Spokane Regional Chamber Chair Shaun Cross at AWB’s Spring Board meeting. In fact, Spokane is home to the second and third largest hospitals in Washington state.

via “Sweet Home Spokane”: A Regional Strategy for economic.

Update: That quote is probably not correct. The truth is about 11% – 12% of GDP is health care related (maybe!). The Spokane Regional Chamber changed its name to GreaterSpokane, Inc.

Why the push for industry clusters?

To make a region more competitive? May be not:

WASHINGTON ECONOMIC DEVELOPMENT COMMISSION: Regional Innovation Clusters: A Strategy to Compete for Federal Funds

Income versus test scores

A comparison of income versus test scores for two elementary schools in Spokane:  Blogs – The great educational-income divide.

Wages for government jobs

The Great Seal of the State of Washington

Image via Wikipedia

Some one collects all public salary data and posts online – for the whole State of Washington and local towns and counties. Search the web site for Spokane area government agencies, if interested.

4 out of 5 new jobs are low pay

From the Economic Policy Institute – 4 out of 5 new jobs created in the U.S. fall below the median. And 3 out of the top 5 are in health care. Basically, we have offshored our high value jobs and replaced those with low value service jobs. Our government policies are based on economics theories that global wage arbitrage leads to the best economic outcomes for Wall Street everyone.

Jobs … but low pay.

The nation is now mirroring Spokane’s long time economy:

The most recent jobs data show that every industry – with the exception of health care, education, and the government – has fewer jobs today than before the recession began, strong evidence that demand is weak across the entire economy.

Incoherent Cluster Strategy for Spokane

M92 - Globular Cluster

Image by Astro Guy via Flickr

The photo, at right, is an astronomical globular cluster.

10 to 20 years ago, the focus was on such things as high tech manufacturing in electronics and medical instrumentation. Ten years ago, “energy” or “alternative energy” popped up. 5 to 7 years ago, the new focus was going to be an information technology cluster and wireless technology.

In 2005, the new focus would be

“…financial services, advanced manufacturing, logistics, information technology, health and biomedical, and higher education and research and development.”

Between 2005 and 2008, the plans evolved  to regional health care delivery and the “emerging bioscience cluster”. All the tech stuff  disappeared from the 2008 regional economic strategy plan. Poof! Gone! (IT is still on the list but mostly because of INHS’s excellent system integration work in health care medical records systems and start up NextIT innovative online customer support tools.)

Finally, in 2009, the Spokane County Commissioners signed off on the latest list of “clusters”. And it is not much like the others … no surprise. Amusingly, their official list of five clusters has six listed clusters. Attention to details anyone?

The Inconsistencies of Cluster Promoters

Cluster promoters tell us that tight knit industry clusters foster cooperation, communications and new synergies between people and businesses, creating new opportunities and more competitive firms. The very concept of clusters is all about geographically close communities and face to face interaction.

But then they start defining Innovation Zones and Technology Triangles by drawing ever expanding geometric shapes around Spokane to cover tens of thousands of square miles.

Which is it: clusters are tight geographic ecosystems or sprawling blobs? A cluster can not be both!

Clusters are defined in terms of their size in the local economy. Other than government and health care, and maybe transportation/warehousing/distribution, Spokane does not have industries that today rise up to the scope of true clusters. Local promoters therefore promote the lack of clusters as a benefit because we have a diversity of (too small to be) clusters.

In other words, not having clusters is a benefit?

Meanwhile, local promoters still make claims about either a tech or information technology sector in Spokane. Yet the State’s own laws mandated that the State stop supporting high tech in Spokane and several agencies that previously functioned to assist tech startups were shut down between 2005 and 2008.  (The details of the State laws and the agencies that were shut own are here.) Local promoters are inconsistent in promoting industries that by State law, will not have the state’s support behind them because they do not fall into the State selected clusters.

Local promoters push local clusters that by State law, are not going to be supported in Spokane.

Bottom Line: The cluster policy for Spokane is incoherent and inconsistent and likely causes actual harm to the economy by diverting resources away from business opportunities in Spokane.

Chart shows identified clusters (from a 2004 report) for the decade 2000 to 2010. The red circles are the segments that seemed to meet the clustering definition. At the time, it was hoped that the blue circles near the middle of the chart would emerge as clusters too. But all but Higher Education have declined since then. As the 2009 EWU report notes, IT and Bioscience clusters do not exist in Spokane.

Read more of this post

Sterling Financial Corporation of Spokane, Wash., Completes $730 Million Recapitalization Effort

Sterling Financial was in a bit of a financial mess and was required by regulators to raise $730 million:

Sterling Financial Corporation of Spokane, Wash., Completes $730 Million Recapitalization Effort – MarketWatch.

As part of the deal, taxpayers, who had loaned the bank $303 million in TARP funding, will get $60 million in stock instead. New investors get full value for their investment, however.

Existing shareholders end up owning 2% of the company, essentially wiping them out, along with their largest creditor, the taxpayers, who will lose 80% of their “investment”.

Foregoing the loan payback appears to be a $243 million Federal subsidy to a Spokane business. Nice. That should be a boost to the Spokane economy.

New bus service to run between Spokane and Kettle Falls

Gold Line – Travel Washington – Kettle Falls to Spokane, WA.

The Federal government will pay about 70% of the costs of running the twice per day buses between Spokane and Kettle Falls, Wa. Which would be an additional subsidy to the Spokane region.

Crime rates in Spokane Valley

However, he recently provided information to the Spokane Valley City Council showing that burglaries in July had nearly doubled compared to the same month in 2009. And, reports of car prowling have jumped from 63 last July to 156 this year

via Officer shoots, kills nursery owner, pastor – Spokesman.com – Aug. 26, 2010.