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Small business owners in the United States are overwhelmingly disillusioned and dissatisfied with the federal government, according to a recent press release from American Management Systems, a 21-year-old organization that provides turnaround services and profitability guidance to more than 6,000 small- to medium-sized business across 400 industries. The clear-cut results of the survey, conducted this year from June 23 to July 3, certainly aren’t sunny or optimistic. In fact, the opinions of small business owners are rather bleak in regards to the US economy and government. 86% say the federal government is doing “little to nothing” to help small businesses 81% believe the United States is in an economic recession 50% believe the US economy will get worse before it rebounds 78% say the economic stimulus checks did nothing to help their businesses 72% believe that the government is bailing out big businesses on Wall Street “Our country’s 23 million small business owners are disappointed with the lack of actions on their behalf. While Wall Street and big businesses get bailed out, small businesses receive no assistance in these difficult times,” says George Cloutier, founder and CEO of American Management Systems. “Tens of thousands of small businesses will fail this year due to government inaction. They create 60% of the nation’s jobs; the small business industry is clearly an economic engine and it’s stalling. It’s time to get it re-started.” When the survey tiptoed into our volatile political landscape, 80% of respondents admitted to having no idea what Senators Barack Obama’s and John McCain’s platforms are pertaining to small business. Yet, 38% of small business owners favor McCain over Obama, who attracted 21% while 32% remained undecided. Perhaps coinciding with the preference to McCain, 77% of respondents believe the government should tap into restricted oil reserves in Alaska and off the coasts of California and Florida. Of the 400 people who took part in the poll, 37% identified themselves as Independents, 33% as Republicans, and 22% of Democrats.
A few months ago, we reported in this space that there is a silver lining in the generally depressing story of the plummeting U.S. dollar: the corresponding rise of the euro is dramatically increasing the cost of manufacturing cars in Europe, leading overseas car makers to take a close look at shifting production to the United States. German auto giant Volkswagen has now put an exclamation point on this trend with its announcement that it will locate its new car plant in Chattanooga, TN. VW closed its last US plant, in Pennsylvania, in 1988. The increasing cost of European car production was cited as a major factor in VW’s decision to locate its new plant in the U.S. The Tennessee site was declared the victor after an intense competition with locations in Alabama and Michigan. VW’s move is expected to pump more than $1 billion into Tennessee’s coffers. ”This project will have a significant impact on the economy of Tennessee and the region for decades to come,” Gov. Phil Bredesen declared in announcing the news. Tennessee officials are predicting that the arrival of Volkswagon eventually may put the state in position to become the overall leader in U.S. car production in coming years. When it is fully operational in 2011, the new plant will employ 2,000 people directly as well as offering business to hundreds of suppliers. The new facility will eventually have an annual capacity of 150,000 vehicles and will be used to build a new midsized vehicle for the U.S. market. VW said its decision also was based on a range of factors including financial incentives offered by the state linked to job creation, investment and training. Currency exchange rate fluctuations—the euro is now worth almost $1.60—in the past two years have made European carmakers look for cheaper production solutions. VW also is building plants in India and Russia. So perhaps all those reports of the impending demise of U.S. auto manufacturing you’ve been reading in recent years were a bit premature.
When cheerleaders from Ohio and Pennsylvania start shouting at each other, it’s usually because Penn State’s Nittany Lions and The Ohio State Buckeyes are battling it out for the number one ranking in college football. Well, the cheering has come early this year, and we are pleased to report that the ranking generating all the hoopla is Business Facilities’ annual tallying of Overall Biotechnology Strength in the U.S. It seems like the entire state of Ohio erupted as soon as they got their hands on our annual Rankings Report, which was published last month (and currently is appearing on the home page of this Web site). Ohio ranked fourth in overall biotech strength (tied with Texas), a quantum leap forward from last year’s showing. Ohio’s move up to the biotech big leagues was made possible by the state’s commitment to its Third Frontier tech-funding initiative and muscular university research programs, among other advances. When our Rankings Report hit the streets, we immediately got a call from the Columbus Dispatch. The newspaper published a story in the next day’s Business section, and papers in Dayton and Cincinnati also covered the news. The Dayton paper put the word out on national business wires. The next time our phone rang it was a National Public Radio station in Cleveland (WCPN) on the line, asking for an interview about the biotech results. We ran into the bathroom and gargled, and then used our best radio voice to extol the virtues of Ohio’s achievement. We knew it wouldn’t take long for Pennsylvania, which snared the top ranking in overall biotech strength, to clear its throat. Sure enough, this week we heard a roar from Nittany Lion number 1–no, not Joe Pa, but Gov. Ed Rendell. During a groundbreaking in Montgomery County for the new North American headquarters of Almac, a provider of research, development and manufacturing services for the global pharmaceutical and biotech industries, Gov. Rendell made a special announcement citing his state’s top ranking in the annual Business Facilities report. ”We have laid the groundwork to keep Pennsylvania number one in biotech,” Rendell said. “The commonwealth’s support for the entire continuum of biotech initiatives, from research and development and product commercialization to bringing mature companies to our state, is paying dividends, even in these uncertain economic times.” The initiatives that secured the top biotech spot for Pennsylvania included the investment of more than $228 million in tobacco settlement funds in health-related research projects (including $150 million for bioscience in 2007-2008); more than $500 million […]
For the past 80 years, Nutley, NJ has been a company town. For as long as anyone can remember, the Swiss pharmaceutical giant Hoffman-La Roche has loomed over the local landscape and served up thousands of jobs along with thousands of little blue and yellow pills. The creator of valium and librium probably saw a spike in sales for the popular sedatives in Northern New Jersey late last month, when it sprung an announcement that, as part of its takeover of biotech behemoth Genentech, Hoffman-La Roche will be moving its U.S. headquarters from Nutley to California. The news that the company—called ”Roche” by long-time denizens of Jersey–would rip out its deep roots in the Garden State and head for the Left Coast took everyone by surprise, apparently including New Jersey’s beleaguered governor, Jon Corzine. Corzine’s has had a very rough time during his inaugural term in Trenton. First, he discovered that the state is in debt to the tune of $30 billion, prompting the governor to propose increasing tolls on the NJ Turnpike from $7 to $50. Under intense criticism for negotiating a state labor pact with his then-girlfriend, a union president, Corzine responded to demands that he release his personal email messages by announcing that he would no longer use email. This probably explains why he didn’t acknowledge our get-well message after his near-fatal car crash. Corzine, late for a meeting with radio shock jock Don Imus, instructed his state trooper driver to put the pedal to the metal. The unbelted governor went flying through the back window of his SUV during the 90-mph crash, breaking about 20 bones in the process. To his credit, Corzine not only paid the fine for failing to wear his seatbelt, but also taped a memorable public-service ad in which he somberly intoned: ”I’m Jon Corzine and I should be dead.” Unfortunately, some Jersey political wags have reacted to Corzine’s latest menu of tax increases by suggesting the line may reappear as a bumper-sticker slogan should the governor attempt to run for re-election next year. While he thankfully has recovered from the grievous injuries sustained in the crash, the governor’s string of bad luck continues unbroken: According to reports, Corzine and his current gal pal were in Israel when news of Roche’s defection broke. (The governor paid all the travel expenses out of his own pocket, but it wasn’t a vacation–it was a ”trade mission,” says his office). Roche employs more than 3,000 at the Nutley complex, centered around a 10-story tower that […]
Yesterday, I received a press release from the U.S. Green Building Council (USGBC) announcing the new certification bodies for the LEED Green Building Rating System. These organizations are: ABS Quality Evaluations, Inc. BSI Management Systems American, Inc. Bureau Veritas North America, Inc. DNV Certification Interek KEMA-Registered Quality, Inc. Lloyd’s Register Quality Assurance, Inc. NSF-International Strategic Registrations SRI Quality System Registrar, Inc. Underwriters Laboratories-DQS, Inc. This evolution in the certification process is part of a major update to the technical rating system which will debut in January 2009. Currently, all LEED project submissions are assessed by the USGBC and a panel of independently contracted reviewers. But the addition of the above certification bodies has ushered in a new, improved means of awarding green standards that is able to grow with the enviro-friendly movement. Speaking of this said movement, I read a recent article online that discussed how ‘going green’ is turning into a fading trend in the United States. Some environmentalists warned that all of the eco-minded ad campaigns, media coverage, documentaries etc. would inundate the public consciousness in a good way, but eventually may “go out of style.” Are we really as fickle about important issues (i.e., global warming) as we are about, say a tacky fashion trend or a pop song? In such a consumer culture, probably so. But I sure hope not.
When we last left Rex Tillerson, chief executive of Exxon Mobil, the $479 billion fossil fuel empire he commands was proudly announcing a 29 percent increase in his annual compensation package. Well, Rex must have finished counting all that moolah, because he took the time last week to submit to a Q & A from The New York Times. In the interview, published in Sunday’s Business section and adorned with a smiling photo of Rex, the Exxon Mobil chief put to rest all of this nonsense we’ve been hearing about the awl bidness going the way of the dinosaurs. ”Chief Says Exxon Will Keep Doing What It’s Doing,” the headline announced. Rex was asked to comment on the absurd suggestion from some radical political quarters that the United States can’t drill its way out of the energy crisis, and that perhaps, maybe, it is time for America to think about a real alternative energy policy. ”The reason the United States has never had an energy policy is because an energy policy needs to be left alone for 15 to 20 years to take effect,” Rex declared. ”The answer is you can’t fix it right now.” Rex then boldly told us that the first thing the U.S. needs to do to meet its energy needs is ”to look in the mirror.” While we are busy looking in the mirror, Rex indicated, the second thing we need to do is let Exxon Mobil rip into the coastal waters of California and Florida and pull some more oil out of the good, old U.S. bedrock. Those rude fellows at the Times had the audacity to interrupt this important message and ask Rex why Exxon Mobil did not invest in new oil supplies when prices were low in the 1990s. ”You could say the industry paid a big price for overinvesting in the 1970s and 1980s,” responded the man who presides over a company that reported more than $40 billion in revenue in the first quarter of this year. The editors plowed on, asking the Exxon Mobil potentate to give the average American some advice on what to do about the hideous price of a gallon of gasoline. Displaying his common touch, Rex helpfully suggested that his fellow citizens ”use mass transportation and economize the trips they take.” Rex tastefully did not mention the hefty stipend he is receiving from Exxon Mobil this year to pay for his personal use of corporate aircraft. No point in rubbing it in. Finally, the Times editors lobbed […]
A rather bizarre sight greeted tax attorney Mark Vulcan when he arrived for work at the Maryland Department of Business and Economic Development (DBED) in Baltimore earlier this month. Stretched out in front of the DBED office were a bunch of rumpled executives, several of whom had slept on the sidewalk all night, waiting for Vulcan to arrive. No, they weren’t trying to purchase seats on the 50-yard-line for the Ravens’ upcoming NFL season. The folks in the wrinkled suits were investors queuing up for a chance to apply for a piece of Maryland’s $6 million Biotechnology Investment Tax Credit. Vulcan is the fellow who accepts the applications. Maryland’s biotech incentive program already has leveraged more than $24 million in private investment since its inception in 2006. The program provides tax credits equal to 50% of an eligible investment (investors make an equal match). To qualify, companies must be less than 12 years old; be headquartered in Maryland; employ fewer than 50 people; and have a valid certificate from the state DBED. DBED reviews the applications and issues its initial credit certifications within 30 calendar days. During the first two years of the program, the $6 million credit allocation was not exhausted for several months. This year, Maryland upped the ante, opening the program to a larger number of investors and giving out larger shares of the credit—up to $250,000 per investor—on a first-come, first-serve basis. The enhanced incentive program had biotech investors flocking to the DBED office like, well, ravens. If a recent proposal from Gov. Martin O’Malley is enacted, the ravenous appetite of investors for the popular biotech incentives may expand dramatically, and next year’s pre-dawn gathering at the DBED office could resemble a well-dressed version of a signature scene from another famous vehicle for ravens—Alfred Hitchcock’s The Birds. Gov. O’Malley recently announced the Bio 2020 Intitiative, a $1.1 billion program that would quadruple funding for the Biotechnology Investment Tax Credit by 2013, leveraging an estimated $50 million annually to biotech start-ups in Maryland. Our guess is that the biotech incentive bonanza will spur at least one related economic development: somewhere in Baltimore, a very shrewd street vendor is preparing to ask city hall for a license to sell hot dogs in front of the DBED office.
As panicked depositors lined up in sweltering heat out West to bang on the doors of the shuttered IndyMac banking giant, the U.S. Securities and Exchange Commission emerged over the weekend to announce a major crackdown. The SEC usually doesn’t work on weekends, because they are so tired from doing almost nothing during the work week, at least for the past seven years. So this figured to be a momentous announcement. We envisioned a line of Armani-clad bank presidents and hedge-fund managers chained together, perp-marching into Guantanemo. We picked up the remote and clicked away from live coverage of the Tour de France, where the pelaton was maneuvering en masse around some dog droppings, switching to our favorite 24-hour news channel. ”This just in,” the news presenter breathlessly told us, ”The SEC has announced an immediate and massive crackdown on………..rumors.” Rumors. So the catastrophic implosion of the global financial system in the wake of an unregulated, decade-long orgy of speculation isn’t the real problem, after all. The problem is all the insidious characters whispering about the catastrophic implosion of the global financial system. What a relief! Now we can stop making all those trips ferrying cash from the local ATM to the mattress in the upstairs bedroom. We were about to break open a bottle of flat ginger ale and celebrate, when those spoilsports at ABC News rained on our parade. In a shocking display of defiance of the new government edict banning rumors, ABC revealed that it has obtained a privately-prepared list of the most troubled banks in the United States. The list apparently has been circulating on Wall Street and in Washington. According to ABC, the list was formulated using the so-called ”Texas ratio,” which compares a bank’s assets and reserves to its non-performing loans, based on financial data made public by the Federal Deposit Insurance Corp. (FDIC) in March. Banks with a ratio over 100 percent would be most likely to fail, based on what happened to Texas savings and loan outfits in the 1980s. The rumormongers at ABC weren’t content just to tell us they had this private list. No, they had to go and tell us that a whole slew of banks in Colorado, Maryland, Georgia and California are about as stable as the average protruding Arctic ice shelf. Then they started naming names. We won’t repeat that information here, because the SEC warned us that they’re not going to tolerate that kind of stuff. But if you go to ABC’s web site, you can […]
Back in May, Business Facilities ran a special advertising article on the retail industry, which highlighted a couple of U.S. retail hot spots. It also discussed the resilience of the industry, as it struggles to cope with and rebound from a shaky economy. Fortunately, the retail realm got a long-awaited boost thanks to the first round of federal economic stimulus checks reaching millions of Americans eager to hit the shops they’ve been too wallet-shy to visit. An article from today’s edition of the Chicago Tribune claims great gains for both our economy and the retail industry. The industry saw a 1% increase from last month, which is the largest jump since November. This windfall is double what most economists had predicted the stimulus checks’ effect would have. As more checks reach consumers throughout the summer, it seems hopeful that the industry’s mini-boom will continue, and that the U.S. economy will recover slightly from its “recessive tendencies,” if not its full-blown recession. Let’s just hope that once the economic stimulus payments run dry, that our beloved retail industry can avoid another drastic dip in consumer activity. The Christmas shopping season never comes soon enough…
As I posted in April, Native Americans continue to push past stereotypes that peg their economic development efforts as nothing more than roulette wheels on reservation land. In fact, such casinos don’t always find success, as was the case with the Crow Indians’ Res-a-Vegas in south-central Montana. Fortunately, with an emphasis on fortune, the struggling Crow tribe has announced a new vision that will shift its focus on the coal industry in an effort to create alternative energy and revenue. Tribe members, nearly half of whom are unemployed and garner a per capita income of $7,600, plan to tap a potential multi-billion dollar mineral layer on its reservation, and then build a coal-to-liquids plant. A successful operation would mean an opportunity to transform the lives of tribe members and the infrastructure of the community. In 2005, federal laws regarding energy development were revised to give, rightfully, Native Americans more control over their natural resources. While some tribes complain that wait times for government approval still linger, the laws will hopefully allow the Crow tribe to move forward more expeditiously. “There’s a misconception about Indian tribes that they all have big gaming revenues,” says tribal Chairman Carl Venne. “We don’t have that, but we do have vast resources.” And as far as I’m concerned, let them get every single red cent from their resources. American history is still being written, and it can look a lot kinder to our indigenous people.