Indiana Economic Digest | Indiana
Advanced Search

• Most Recent




home : most recent : most recent July 22, 2017


7/9/2017 5:18:00 PM
COMMENTARY: Economic-development caution -- There are two kinds of progress

Craig Ladwig, editor of the quarterly Indiana Policy Review, is author of "The Star: The First 100 Years." His column appears in Indiana newspapers.

Looking over the raw data of contributions to a typical Indiana mayor, you are struck by the massive amounts coming from those involved in construction, architecture, engineering, etc. It is not an encouraging experience.

For that is how progress is defined today. It is not in an increase in middle-class expendable income, and certainly not in happiness or even security. Rather, it is in commanding the building of new things, steel and concrete things — tax-funded convention centers, sports stadiums, subsidized hotels, riverfront promenades, some of them organized as so-called public-private partnerships or PPPs.

But there is another kind of progress. It is the progress communities make when individual citizen-entrepreneurs are left alone, untaxed and unregulated, when government steps out of the way. Our Ryan Cummins defines it this way:

“What most effectively contributes to each individual’s notion of well-being is known only to the individual himself. If you live in a community that understands this, that promotes and protects free markets and property rights in the operations of local government, that values personal responsibility, you live in Indiana’s ‘best’ city.”

Going over those spreadsheets of thousands and thousands in donations from those making what they surely hoped were legal bribes to the next mayor, I was reminded of the Ready-Mixed Concrete Company and the cautionary stories told to me by an earlier generation of journalists.

Ready-Mixed was owned by Tom Pendergast, a prototype public-private partner and for a time a symbol of progress itself. It is worth remembering that in the early part of the 20th century the ready-mixed cement process was considered high tech. If your city didn’t have a modern cement plant you were second class.

And during the Depression, under a $40-million bond program, Pendergast’s companies in partnership with the municipal government of Kansas City constructed many civic buildings and projects, among them a majestic downtown courthouse, the paving of a watershed near the nation’s first shopping center, the municipal auditorium and the inner-city high schools — all of it infrastructure, we would say today, necessary for the city to keep moving forward.

These were seen at the time as civic jewels, architectural marvels — and were much lauded. Pendergast, you see, was a civic leader, a booster. Thousands owed their jobs to him, or at least thought they did.

Only later, as his power waned, would it be clear that the progress had been managed by an unaccountable political machine staying afloat on the backs of taxpayers. Pendergast won these contracts as a result of his control of local government through political donations and patronage jobs. It was about power, you see, not progress.

Notably, the city’s system of cement viaducts, reportedly six feet deep in places, helped finance four decades of corruption, much of it legal. This was money that had to be paid back many times over in bonded debt, lost efficiency and lost opportunity.

Could it have been done another way, could progress have been achieved without a powerful boss, without leveraged PPPs, always justified in the name of some inarguable civic good, on the necessity of "moving the city moving forward"?

The reporters and editors who covered that era thought that in fact it had been done another way. Although several had won Pulitzer Prizes writing about Pendergast, they were emphatic it was not investigative reporting that broke his machine. Nor was it the “Good Government Club” that rose up to oppose Pendergast on the city council.

Rather, it was progress — that second kind. The Pendergast gang lost their power as the city’s middle class began to prosper, independent of any contracts to the Ready-Mixed Concrete Company or donations to the political class. And so will the gang in your town lose its power.






Editor, John C. DePrez Jr.; Executive Editor, Carol Rogers; Publishers: IBRC and IAR


Software © 1998-2017 1up! Software, All Rights Reserved