Las Vegas Sun

March 28, 2024

SUN EDITORIAL:

Looking to the future

State needs a long-range plan to diversify the economy, spur development

In an effort to kick-start Nevada’s economy, Gov. Brian Sandoval and other leaders have talked about diversifying the economy by bringing new businesses here.

The state has been trying to lure businesses here for years in an effort to broaden the economy, which would give the state more stability in downturns. As it is, Nevada depends on tourism and mining, and anything that affects those industries can have a major effect on the state.

Nevada should be a natural to bring in business. It has good credentials in the business community — it is regularly rated as one of the best states in the nation for business and few states can match Nevada’s low taxes.

But being business friendly and having low taxes haven’t brought businesses beating down the door. It’s more complex than that.

Lt. Gov. Brian Krolicki, whose job includes economic development, said there are “a wide variety of issues” that businesses take into account when they consider moving such as workforce, education, proximity to customers, taxes and regulation. And that’s not to mention many other things such as real estate costs, infrastructure and transportation. And don’t forget quality-of-life issues, either.

As David McGrath Schwartz reported in Thursday’s Las Vegas Sun, state leaders have plenty of ideas about how to attract business — from creating investment funds to spur development to cutting red tape. Those are good ideas, but it’s important that the state doesn’t settle for one “fix.” Too often, political debates end up with one idea pitted against another. That would be wrong in this case.

The state needs a broad plan to develop the economy, and that will take efforts to bring companies into Nevada, but it can’t stop there. Nevada needs to build the workforce and incubate and develop new businesses here.

Economic diversification will have to be rooted in education. Consider that a Brookings Institution study found that cities in the Intermountain West that had better-educated populations fared better during the recession.

States that have strong colleges and universities understand why — not only are people getting educated, creating a strong workforce, but businesses are developed. As well, many universities across the nation have spun off startup companies from research and development done on campus. The fact of the matter is higher education can be a driver of the economy.

But economic development will take more than the university system. Not everyone will go to college, and not every business needs highly trained workers. The public schools also have to be boosted to develop a strong workforce and provide students with a good educational foundation.

Unfortunately, Sandoval’s budget plan would make significant cuts in the university system as well as public schools. Some lawmakers have claimed that the education system has plenty of money, that it just needs to be reformed. Certainly, there are reforms needed, like making it easier to get rid of bad teachers, but reforms alone won’t solve things. The state’s per-pupil spending has been below the national average for years, and the colleges and universities have been hammered by previous rounds of cuts.

If Nevada truly wants to diversify the economy, the governor and Legislature are going to have to do better than cut. No one can really think that will improve things, can they? And leaders can’t think that creating a new program or two to attract business is the answer.

To reshape the economy, the state is going to have to invest money, time and effort, and that will take real leadership in Carson City. The governor and the Legislature can’t do what others have done before them and push the problems off into the future. The state can’t afford that anymore.

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