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Gavin Newsom

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Regaining California's Leadership Role as America's Opportunity Capital

Posted: 08/22/11 05:18 PM ET

Senator John F. Kennedy used to roast the Eisenhower Administration's overly-rosy economic forecasts by comparing them to "a policeman bending over a body in the alley and saying cheerfully, 'Two wounds are fatal. The other one is not so bad'."

As a small business owner and Lieutenant Governor, I'm reminded of those words every time I'm asked to make the case for investing, expanding or otherwise creating jobs in California. And, I know from personal experience that there is no better place to live, work or invest than California.

We have the highest educated and most productive workforce in the country. We are home to the most diverse regions, communities and Tribal nations. Hollywood entertains the world. Silicon Valley keeps the world connected. San Francisco and San Diego drive the global biotech industry. Our Central Valley produces the most abundant agricultural output in America. California is truly a global epicenter of innovation.

California owes its leadership on innovation to our small businesses and start-ups. Comprising 96 percent of our exporting firms, our state's small businesses drive progress in every conceivable field, and are responsible for creating two out of every three new jobs.

We also lead on industrial production. Representing nearly one in ten working Californians and 87 percent of our exports, our manufacturing base is one of the most sophisticated and diverse in the world.

These realities give us reason to hope, but they gloss over the deep, fundamental cracks in our economic infrastructure.

A troubling perception has taken hold across the financial landscape that California's economy is now stuck in a state of permanent stasis, that we've somehow lost our mojo, and that recessionary pressures have been exacerbated by partisan paralysis in Sacramento. That perception is because California's in crisis. We have the second highest unemployment rate in the nation. Out of 58 counties, 52 are suffering from double-digit unemployment -- 21 of which exceed 15 percent and Imperial County, with an astonishing unemployment rate of over 30 percent.

That's why I've spent my first year as Lieutenant Governor traveling across the state and the country to find out what's working and seeking best practices.

With the support of leading business and labor organizations and national think tanks, we developed and distributed an "Economic Growth and Competitiveness Agenda for California." This agenda is designed to start a new dialogue about specific and achievable action steps -- that are low-cost, high-impact -- that will set the course to success, working towards more challenging issues by building trust and a sense of common purpose and vision. Working together, we will regain California's leadership role as America's opportunity capital.

In light of the fact that the agenda is broad in scope and forward-looking, it's fair to ask, Where do we go from here? What can be done at this critical moment?

The Governor has already taken the first step by adopting the agenda's top recommendation and appointing a new job czar for California.

We must organize around a new competitiveness and economic development team for California. Within weeks, with the extraordinary leadership of Assembly Speaker John Pérez, a bill will arrive on Governor Jerry Brown's desk that establishes a new economic development agency for the state.

This is not about creating more government bureaucracy; it's about consolidating and streamlining our efforts, providing a one-stop entry point for business assistance, while supporting regional economic strategies.

At the same time, we will establish working groups that include a broad coalition of individuals, to build consensus and make recommendations for action around key issues including data, regulatory smoothing, regional alignment, trade, manufacturing, and workforce development.

Additionally, California must immediately begin promoting both trade and its international presence as an economic priority. The agenda calls for the development of comprehensive export strategies for each of our state's regions, which will in turn benefit our entire state. California must re-launch its brand internationally. That is why this Fall, through private-public partnerships, we will reestablish an official state presence in international markets, beginning with China.

And finally, it's no secret that California is home to the top innovation centers in the nation -- San Francisco, San Jose, and San Diego regions are the state's top generators of patent applications (per 1,000 employees) and high-tech employment. Federal laboratories like Lawrence Livermore and Sandia/California represent enormous intellectual assets, as does the University of California system, which holds one of the largest patent portfolios in the world. Therefore, it's essential that the Federal government locate one of the three new U.S. Patent and Trade satellite offices in California. In the coming months, I will work with our legislative leadership and Congressional Delegation to make this a reality.

Too much is at stake in California. Something has to change dramatically. I look forward to convening our first annual Economic Growth and Competitiveness Summit within 180 days as we work together to shift the dialogue and get California moving again.

 
 
 

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