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Economic
Development
Pennsylvania as a
whole, and the Greater Philadelphia
region, faces an economic crisis. We are losing population. Many of our
cities and towns are decaying, as are sections of
Philadelphia. Our best educated children are leaving the
area. (The whole depressing story can be found in a recent report by the
Brookings Institutions.) The General Assembly has to work with the
Governor to dramatically the change direction of our region and the
Commonwealth as a whole.
When we think
about economic development we often focus too much on the amount of
business done rather than the number and kind of jobs created and the
impact of work on our communities. The primary purpose of economic
development is to provide men and women with good jobs and to build
strong commercial districts in our communities. We want a strong,
vibrant economy that provides not just dead-end jobs but careers that
give people good wages and opportunities for advancement. We want a
growing, prosperous economy that does not abandon but, rather, supports
the communities that are so important to us.
There is no single
path to economic development. We need to bring a variety of policies
together to create an economy that serves workers and communities.
The Right Kind of Jobs
We sometimes think
there is only one way that a business can produce certain goods and that
all businesses, and all economies, must follow a single model. Nothing
can be further from the truth. Goods from clothing to computers can be
produced in companies that rely on lots of unskilled, low paid manual
workers who work with simple and inexpensive machinery. And they can be
produced in companies that rely on smaller numbers of skilled, highly
paid workers who work with the most advanced technologies.
We need to create
a high skill, high wage economy in Pennsylvania. Doing so is a complex
process. In brief, it requires that we:
Increase the minimum wage:
As a result of inflation, the minimum wage has been declining every year
since its peak in 1968. Then its value was $7.92 (in dollars adjusted
for changes in the consumer price index.) Today it is $5.15. Full-time
minimum wage workers today earn only $10,712 a year, not enough to raise
a family in decent circumstances. Increasing the minimum wage to $8.00
would dramatically improve the economic wellbeing of many
Philadelphians.
Raising the
minimum wage would also spur the right kind of economic development.
When workers are paid high wages, businesses have an incentive to make
their workers as productive as possible. So the offer them advanced
training and the most advanced technologies. And, since they don’t want
to lose their investment in training their workers, businesses provide
good working conditions and other benefits. (High wages also directly
help keep workers from leaving their jobs.)
Raising the
minimum wage will also increase the demand for goods and services in
Philadelphia. Businesses located here will be the
beneficiary.
Support Worker Training and Retraining:
We need to dramatically
expand and refocus government-business partnerships to provide workers
in Pennsylvania with the training they need to hold good jobs in an high
skill, high wage economy. Today we provide government subsidies for
those who go to college—although here, too, the level of support is not
what it should be. We need to provide similar subsidies to those who are
not going to college. Not doing so is unfair. And it undermines our
economic growth. We need to coordinate this training with the needs of
businesses in the Commonwealth. By providing
government support for worker training, we make it possible for
them increase the skills levels of their work forces and pay higher
wages.
Provide Aid to Small Business:
Most of the new jobs in America today are created in small businesses.
We have to insure that small businesses have access to capital, can
provide training to their workers, and can provide health care to their
employees.
Give Workers a Piece of the Action:
When workers have a bigger
stake in the businesses in which they work, they become more motivated
to do their job well and to increase their skills and abilities. And
businesses in which workers have some control do not pick up and run to
areas with low skilled, low wage workers. We can aid companies that give
workers a piece of the action by tax incentives and program sto make
lower cost capital available to them.
Taxation
Keeping taxes as
low as possible can contribute to economic development, but not if the
government is too impoverished to provide the kinds of support a
high-skill, high-wage economy needs.
More important
than the overall level of taxation is the mix of taxes we use. The
Philadelphia and commuter wage taxes undermine economic
growth not just in Philadelphia but in our surrounding counties, which are
heavily depending upon the Philadelphia economy. It is time to create a region wide
alternative to the wage tax. Those who live outside our city, but work
here and take advantage of our theaters and restaurants, have to pay
some of the cost of providing the city services on which they rely. But
the wage tax is the worst way to do this, because it undermines job
creation and because the burden of supporting the city falls wholly on
those who work here as opposed to those who work outside the city but
benefit not just from our economy but, also, our diverse cultural life.
We need to replace
the Philadelphia and commuter wage tax
with a combination of a regional sales tax and greater state spending on
local needs, such as education and transportation. A regional sales tax
that exempts food and clothing would be a moderately progressive tax, in
which the rich pay at higher rates than the poor. State spending on
local needs should be financed by moderately progressive increases in
the state income tax. Our state income tax is substantially lower than
those of neighboring states. And it is a flat tax, in which the tax rate
is the same for rich and poor. This is unfair.
Gambling is a bad
idea whose time has come. In principle, I do not think that state
governments should do anything to encourage gambling. Nor should they
rely on this regressive form of taxation. But when the surrounding
states allow gambling, our economy loses the money that Pennsylvanians
spend in other states. So I favor Governor Rendell’s policy of allowing
slot machines at racetracks. Gambling outside the racetrack should be
limited to the kinds of establishments that mainly cater to a wealthy
clientele, thus restoring an element of progressivity to this revenue
source.
Wireless Internet
Access for Everyone
Under my
leadership, West Mt. Airy Neighbors has been working to create a free,
wireless internet hotspot in what we think of as downtown Mt. Airy, on
Germantown Avenue between Allens Lane and Sedgwick Street. This hotspot
will give everyone who takes a computer with an inexpensive wires card
high speed access to the internet. People in cafes and restaurants will
be able to surf the net or check their email with out charge, as will
people who are waiting in a Doctor’s office. People who want to start a
new business or professional firm will have an inexpensive means of
connecting to the internet. And people who live on the Avenue or in the
unit blocks will have free internet access. This will go some way to
overcoming the digital divide—the large gap in the computer resource
available to the rich and poor.
If elected as your
State Representative, I will work to expand this program to other areas
in the 198th district—to the rest of Germantown Avenue, to
Chelten Avenue, parts of Wayne Avenue and Greene Street and to our train
stations. Eventually we might be able to create wireless interact access
throughout the district.
Community Development
and Land Use Policies
Economic
development also requires effective community development. And, rather
than gobbling up more and more undeveloped land, we need public policy
to redirect economic development to urban areas, especially those that
are subject to population losses and the abandonment of housing and
commercial buildings. I favor a number of public policies that would
dramatically reduce urban sprawl. We should to adopt land value taxation
to replace our current property tax. We should require county and
regional land use planning together with transferable development rights
that create incentives for development in some areas while protecting
undeveloped land in other areas. We should discourage wasteful
development by requiring developers to bear a greater share of the
burden of the public utilities that makes new construction possible. And
we should encourage the development of location efficient mortgages that
make mortgage cheaper and more readily available in areas where
extensive automobile
travel to work and shopping is not needed.
I also support
additional funding for programs that spur community development. (Click
here to see my discussion of these programs.)
Effective Zoning
Efforts to promote
the right kind of economic development have been hampered by recent
changes in zoning law and by the way in which the political process has
shaped the application of this law in Philadelphia. Effective zoning
promotes the kind of economic development that contributes to strong
communities. Too often, however, we seek immediate economic returns at
the cost of both long term economic growth and livable communities.
The fight over
billboards in Philadelphia is one example. The proliferation of
billboards makes some people wealthy. But billboards contribute nothing
to the creation of a high wage, high skill economy. Indeed, there is
little reason to think that they contribute to commercial growth at all.
What they do, however, is make undermine the attraction of neighborhoods
and the city as a whole to those who might want to live and work here.
Zoning laws,
fairly applied, guarantees the owners of homes and businesses that their
investments will not be undermined by capricious development. When the
intent of these laws are ignored or thwarted, people lose confidence in
our city government. Fairness and economic development both suffer.
As your State
Representative, I will help you protect your rights under the zoning
code. And, I will introduce legislation to overturn a recent court
decision, the Hertzberg case, that has encouraged the Zoning Board of
Adjustment, and the Courts, to give or approve variances to the Zoning
Code that, in the past, were not granted. t
Regionalism
Public policies
that support economic development must focus on the whole region, not
just particular cities and towns. Economic development requires regional
cooperation in taxation, transportation and the training of workers.
Right now, we have no effective means of forging regional policies. The
state legislators in our region should take the lead in this effort.
The best way to do
this right now is for Democrats and Republicans to work together to meet
the needs of the region for greater spending on transportation and for
reductions in the wage tax. In the last session of the legislature,
Republican legislators from the counties surrounding
Philadelphia stuck with their party leaders. Especially in
the State Senate, this leads them to reject public policies that would
benefit the entire region.
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