In a time where the banking industry has been less reliable than Americans have seen in many years, is it possible to buy stability? More importantly, can Delaware businesses and citizens afford the price tag? In Delaware, the legislature spent the summer trying to raise the money to do just that. A few of the papers were among the first to condemn the lawmakers for taxing the local communities to raise the capital necessary to attract corporations like Amazon.com. The Amazon.com relocation will provide more corporate diversity in the industry mix for a state that has been closely identified with the banking industry’s lending arm. The diversity can provide the peace of mind to small business owners looking to base their plans for the future on more than one industry, and feel confident that a ripple in one industry won’t send them down the same slide because they rely on that industry so heavily.
Just because the government builds it doesn’t guarantee they will come – or worse, it doesn’t guarantee they will stay. In a recent article by David Mildenberg for Bloomberg News, he explains why the creation of the right environment is only part of the equation. He goes on to explain that even if Delaware officials get a big company on the hook, it doesn’t mean that they’ll be able to keep it. The city of Wichita spent $43 million on a training center for aerospace workers, and Boeing still decided to close its facility employing over 2100 employees. States like Illinois, New Jersey, Texas and Oklahoma are not only investing in the right packages to attract new corporations, but also in the right packages to keep them once they are settled in. What does this spell for Delaware?
In the short term, businesses and citizens can see that the legislature is focused in getting the large corporations here, but we may not see much relief in sight from the funding plans because of the competitive market that has emerged. Delaware businesses and citizens may have to work just as hard to keep them once they are here, and in that effort we may have to be willing to spend to maintain the stability of diversity. The reason behind this is not due to the infrastructure nor is it due to the continued tax incentives. That’s right, it comes down to spending to keep ahead of the curve for these corporations and maintain Delaware as the best place for the next step in their strategic plans. Delaware businesses and citizens will be funding the research facilities at the universities, pushing the secondary industries to remain agile and keep the minds of the local business community open to reinvention to maintain the competitive advantage. So in response to the rhetorical question earlier about affording the price – the real questions is not if Delaware businesses and citizens can afford the price, but rather which way does Delaware prefer to pay the price.
This guest post was written by Jason Monaghan with University of Notre Dame Executive Online Education. Jason works with the faculty and staff at Notre Dame Online to develop skill sets for the leaders of tomorrow in Negotiations, Leadership and Management and Business Administration.