Dean Barber

Archive for September, 2012|Monthly archive page

Site Certification: Saddle Up Old Kate

In Uncategorized on September 30, 2012 at 1:32 pm

The Business Roundtable’s CEO Economic Outlook Survey for the third quarter of 2012 came out last week showing that CEOs are once again decreasing their expectations for sales, capital spending and hiring over the next six months.

It is the lowest reading since the third quarter of 2009, and marks the third largest drop from one quarter to the next in the survey’s history.

The prevailing view is that if our economy grows by 2 percent in 2013, we’ll be fortunate. Uncertainty over the approaching fiscal cliff and accompanying debates about the tax code, sequestration and the debt ceiling does nothing to give corporate decision makers confidence toward the future. And who can blame them?

And yet corporate expansions are happening, albeit at a slower pace. My word of advice to economic developers is to use this slow period to be prepared. You can never be too prepared, especially if and when we come out of this prolonged funk that we have been wallowing in.

And while I am giving out advice, here are a few more truisms to ponder, some of which are probably so obvious that I shouldn’t even mention them, but I will because I have little pride.

If and when a company is ready to a pull the trigger on a site search for future operations, it will almost invariably go through a process of elimination. (At least it should.)  That’s pretty much a prerequisite of the site selection process. It’s true whether the company hires an all-knowing, sage-like site selection consultant, such as me, or attempts to do this winnowing process on its own.

Naturally, I would recommend that a company concentrate on its core business, which does not include the intricacies of a proper and effective site search. My suggestion: Leave the driving to us. A site selection consultant can save a company millions of dollars over the life of a business operation. That’s my story and I’m sticking to it.

The second truism is that when a company needs a building or site, it probably needed it six months ago. Jim Bruce, a site selection consultant in Georgia, came up with that gem, and I think he’s not far from the mark. While CEOs may remain reluctant to pull the trigger, when they do, they want results in a much more compressed  time frame than compared to just a few years ago. Things can get fast and furious.

And here is my third pearl of wisdom for your consideration, and I won’t charge you for this. It is foundational to all business, big and small, and certainly to the site selection process. It’s a four letter word that gut punches some and leaves other exhilarated. That word is “risk.”

In terms of location for a business operation, there are no and will never will be the perfect site or place minus risk. Trust me, there is no nirvana. In heaven, there is no beer. (Which is really kind of sad.)

But there are better places where the risks can be minimized, and where the chances of success can be optimized. As a site selection consultant, my primary duty is to find that better place, where risks are reduced in terms of time and money.

Most experienced economic developers get this. Thankfully, most corporate clients, when they can get past the idea of “get me the most incentives humanly possible,” will also come to this understand this. Solid and fundamental business reasons (with the underlying factor of risk) should prevail and drive the decision on where to invest capital assets.

Now invariably the site selection process will come down to real estate, although the site selection process goes far beyond real estate considerations alone, a fact that escapes some real estate brokers.

Here’s the deal and it took me many years to figure this out: Land does not equate to a site. You may want to read that that again. Equating land to a site is like calling your mule, Old Kate, a racehorse. They are simply not the same.

In my world, a site is a place where a business operation can be up and running, sooner rather than later. Land is, well, just land, minus the attributes of a site. Mind you, land can become a site, but it takes work and planning and investing dollars to make that happen. And guess what? Most corporate clients are not going to wait around for that to happen.

You have heard the old saying that you got to spend money to make money. That is so true when it comes to this animal that we are going to call, for a lack of a better phrase, a certified site. Certified for whom, by whom, and for what purpose? Well, those are good questions.

Confession time (it does the soul good): I certify industrial sites for economic development organizations. What that means is that I work with economic development groups to fast track property for future development by essentially building a file, a dossier, on that site encompassing all sorts of information that another site selection consultant or a company would want answered in their pursuit of reducing risk.

It means providing documentation answering very important questions on the physical nature of the site (as well as its surroundings), in an attempt to assure a corporate client that A). The site is available. B) The site is fully served in terms of infrastructure and utilities and C) the site is, in fact, developable.

On the face of it, these factors might sound quite obvious but the documentary requirements to get there are no small task. That’s partly because there are no national standards to what this thing we call site certification even is. What a certified site is in Oklahoma can be and probably will be appreciably different than in New York.

But I will tell you one thing, when you do it, you will have accumulated a mountain of data on your site and organized in such a manner that it should answer nearly all questions that could ever be raised about your site. And you will come to have a better understanding of your product.

For a corporate client, it’s peace of mind and a fast track to getting off the ground with no hitches or delays. Time really is money and site certification paves the way for quick decision making and starting the construction phase almost immediately.

Last week, I attended the annual conference of the Texas Economic Development Council, and there was a session on this whole notion of site certification and what it means and does. Some economic developers questioned its value, and I understand that. There are no guarantees in life.

But site certification is not a pig in a poke, not a sham, but rather real tangible, meaty stuff that can make a big difference. I truly believe that it can give a community a competitive advantage because it is predicated on preparation beforehand rather than attempting catch-up after the fact.

Me: “So the property still has not yet been rezoned for light industrial?”

Economic developer: “Well, that’s right, but I’m sure we can take this to the zoning board and get it changed without too much fuss in 30 days, 60 days max.”

Me: “No sewer line serving the site?”

Economic developer: “That won’t be a problem. Our mayor is in your corner and will push for this to be done.”

Me: “Really?”

Consider this. I would much rather advise a client to pay $50,000 an acre on a site where all the documentation has been prepared, than a free cornfield where unknown land mines may be lurking. In short, we don’t have the time or the inclination to wait for Old Kate to be transformed into a racehorse.

Can a community self-certify a site? Of course.  I’m sure you could develop a stringent set of guidelines on what documentation is required for your site. But will you do it? And then if you do the required work involved, how do you convince others that your efforts should not be suspect?

It’s one thing when a economic developer characterizes his or her workforce as being exceptionally willing and most suitably able. But it’s another thing when I take a corporate client behind closed doors to get the low down from major employers in the community. We trust but verify.

Same goes with a self-certified site. I’m not saying that you didn’t do the proper documentation, but you have no third party verification stating as much. So yes, you can self-certify. Should you? Well, that’s for you to decide.

Keep in mind, an experienced site selection consultant and/or company will want to do their own due diligence on a site whether it was self-certified by an economic development group or by another consultant. That just stands to reason. But I submit that third-party verification does lend credence to the documentation process,and that third party, serving as another set of eyes, might hold your feet closer to the fire to get things done.

As someone who certifies industrial sites, I feel compelled to tell communities up front that there will be some heavy lifting involved in what can be a lengthy process. And it is also important that they know that I cannot be a rubber stamp.

I have a proprietary list of documents that I require, and that getting 90 percent of them is not enough. For me to put my name on it, we need 100 percent of the documents and answer a set of questions that I think are appropriate and meets the needs of the corporate end user.

So my role is that of coach, advisor, but also ultimately judge and jury. I want to help the economic developer get to the promised land, but it will entail work.

So let’s saddle up Old Kate.

Dean Barber is the principal of Barber Business Advisors, LLC., a site selection and economic development consulting firm based in Plano, Texas. He can be reached at 972-767-9518 or at dbarber@barberadvisors.com Please visit our website at www.barberadvisors.com

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Got Clusters? Don Q to the Rescue

In Uncategorized on September 23, 2012 at 2:06 pm

Rum will do the trick. I am convinced of that now.

So I’m on the roof of a five-star hotel in San Juan, the guest of the Puerto Rico Industrial Development Company, and I am talking to a senior officer of an international medical device company. Only a few feet away is a table laden with and celebrating “the Rums of Puerto Rico,” and we are at, you guessed it, a rum tasting.

I’m enjoying the view, the ocean is to my left, and downtown San Juan is to my right. It’s sunset with a light breeze. I hear a mixture of English and rapid staccato Spanish around me. All the women are beautiful, and each rum tastes better than the last.

Yes, this makes a great deal of sense.

I knew that big pharma was big here, but I didn’t know just how big or how sophisticated until I was on the ground here.  Earlier in the day, I had donned a bunny outfit (minus the tail and ears) to tour a pharma plant which I cannot name for fear that serious men will coming knocking on my door in the dead of night. Having signed a confidentiality agreement, I can neither confirm nor deny that I was actually there, depending on where there was, which it wasn’t.

Over breakfast, PRIDCO’s life sciences director, Victor Merced, gave a PowerPoint presentation, showing me and other worldly site selection consultants just how big manufacturing in the life sciences was on this island of 3.7 million people.  I was impressed.

Eleven out of the top 15 pharmaceutical and biotech companies have manufacturing sites in PR. Amgen has its largest manufacturing facility located in Juncos. More than 90 percent of its products are formulated, finished or packaged at this site, where again, I can neither confirm nor deny that I was at.

Eleven out of the top 20 medical devices companies have manufacturing sites in PR.

A little name dropping for your consideration – Pfizer, Merck, Abbott, Lilly (which I cannot confirm or deny that I visited), AstraZeneca, Johnson & Johnson (which I cannot confirm or deny that I visited), Baxter, Monsanto, Syngenta, Dow AgroSciences, St. Jude Medical, Abbott Medical Optics, Edwards Life Sciences, Roche, Zimmer, Cooper Vision, Medtronic, and Boston Scientific. They’re all here with manufacturing operations.

So, too, are Honeywell, HP, Micron, General Electric, DuPont, and Microsoft.

Maybe my biggest initial surprise was learning that tourism represented only 4 percent of the GDP, while manufacturing represented the lion’s share – $44.6 billion out of total GDP of $96.3 billion in 2010.

Doing his duty, a very personable Merced provided us all-knowing, sage-like consultants with “Puerto Rico’s value proposition,” which included economic, fiscal, legal and regulatory stability; talent and experience; and economic (especially tax) incentives, which appeared to be considerable.

There is a 50 percent tax credit for eligible research activities. There is a 0 to 1 percent pioneer tax rate for a technology, product or processes developed or manufactured in Puerto Rico. There is a 4 percent income tax rate and 12 percent withholding on royalty payments for manufacturing, but a 100 percent exemption for distributions for PR residents.

Finally, for the individual investor, there is a 100 percent tax exemption on interest, dividends and capital gains for those who have not been PR residents during the past 15 years. And there are pre-qualified free trade zones throughout the island.

But it was on the rooftop hotel deck, plied with rum and talking to the executive with the medical device company, where I came to the conclusion that it truly was the human resources – the people factor – for why this cluster of companies manufacturing for the health sciences came into being.

Success begets success and human nature, especially corporate nature, is to at least investigate why and maybe emulate. That’s why I think clusters come into being. It’s not so much what government does (I’m not so sure the governments can create an industry cluster) as what the private sector finds.

The advantages of Puerto Rico were spelled out in a June 2012 report by the Federal Reserve Bank of New York.

  • The literacy rates and educational attainment of Puerto Rico’s adult population compare favorably with those of most economies in the region, and have nearly caught up with those on the U.S. mainland.
  • The labor force is largely bilingual.
  • The economy is open and is favorably located, occupying a central position in the Caribbean and providing a gateway between the U.S. mainland and Latin America.
  • The island has extensive experience as a host to a variety of major U.S. multinational corporations.

It was that extensive knowledge base, gained through years of experience, in the art and science of manufacturing for the health sciences, which is precisely why big pharma, biotech, and medical device companies are here and continue to invest here.

That is what the executive was telling me from the hotel rooftop.  My new friend, Victor Merced, said it, but he’s paid to say it. He is, in fact, a very good salesman with a very good story to tell. (And some quotable quotes: “We go out to fish for whales for the minnows to eat.”)

But here was a private sector guy from the trenches telling me the same. Cumulative knowledge makes the difference. It trumps all. With a Don Q Gran Añejo in hand, your all-knowing, sage-like consultant finally got it.

“I guess having a cluster here allows you to steal talent from each other,” I quipped, thinking I was suddenly pretty smart.

The exec smiled. “We like to think of it as collaboration and benchmarking.”

I recently received a request for proposal from a community that sought an all-knowing, sage-like consultant such as myself to develop a cluster initiative and study. I didn’t bid on it. The problem was, there was no evidence to even suggest that a cluster existed there. Most places – I repeat, most places — do not and will never have true industry clusters. They are, in fact, few and far between, a relatively rare breed.

Puerto Rico is the exception. Here big pharma, biotech, and medical device have recognized fertile ground for manufacturing and this in spite of the fact of having a government known for red tape and permitting issues.

Puerto Rico jumped six spots on the World Economic Forum’s global ranking of the world’s most competitive economies in 2011, landing at 35th out of 142 countries on the strength of efficiency enhancers and innovation and sophistication factors.

But that does not say that Puerto Rico is not and remains a very poor place. A recent study the Annie E. Casey Foundation and the National Council of La Raza found that 56 percent of Puerto Rican children live in poverty, compared with 22 percent for the entire United States.

Were it not for its manufacturing base, one can only wonder how much poorer this island would be.  Even its most ardent supporters will concede that the island has been operating below its potential.

The challenge in a nutshell is jobs. Even in good times, the unemployment rate has been persistently above the U.S. mainland, and especially high for the young and less educated. Puerto Rico’s current unemployment rate is an alarming 13.5 percent while its median household income in 2011 was $18,660, far below Mississippi, which had the lowest average of all states at $36,919.

Although the island’s workforce overall is among the world’s most educated (with 18,000 degrees awarded annually in science, engineering and technology), Puerto Rico’s labor force participation rate is among the lowest in the world, with less than half of eligible workers participating in the formal economy.  (The labor force participation rate was 65.4 percent in the mainland US in 2010, compared to 47.5 percent in PR)

Victor said many people subsist on a cash-only underground economy simply because the job opportunities are so limited. (The underground economy refers to both legal activities, such as often found in construction and services industries where taxes are not withheld and paid, and illegal activities, such as drug dealing and prostitution.)

In its June 29, 2012 report, the Federal Reserve Bank of New York cited the business environment in Puerto Rico as being costly and cumbersome to establish and grow new businesses and expand existing ones.

“In particular, regulations, the elevated cost of electricity, and an underdeveloped and costly transportation infrastructure are barriers to a more dynamic environment.”

Well, that can be said of a lot of places in this world. There will always be “barriers to a more dynamic environment,” because we, as people, can always do better. Governments can always do better. Tell me a place where that is not true.

What I learned from my trip to Puerto Rico, where I cannot confirm or deny that I toured a plant where 83 percent of its employees had a college degree, is that this place has the capability of making some very, very sophisticated products. And that is precisely because of the people, the human resources, that exist here. And that is why a real cluster, rather than a wannabe cluster, exists here.

The people of Puerto Rico take great pride in their island, as they should. They are a warm people and a good people capable of doing great things.

That is what the industry executive was telling me. And that is what I came to understand after taking another sip of Don Q Gran Añejo.

Yes, it all makes sense now.

Dean Barber is the principal of Barber Business Advisors, LLC., a site selection and economic development consulting firm based in Plano, Texas. He can be reached at 972-767-9518 or at dbarber@barberadvisors.com Please visit our website at www.barberadvisors.com

The Other America is All Too Real

In Uncategorized on September 16, 2012 at 8:48 am

Be assured, there is another America out there.  Most of us will not see it cheek by jowel, because we live in our own worlds, our own personal bubbles. But Lord knows, it is out there and probably not too far from your doorstep.

I’m talking about poverty, real, honest-to-God, abject poverty.  Yes, Virginia, there are poor people in America.

The U.S. Census Bureau this past week released new data on poverty in 2011, poverty being defined as a family of four with an annual income of less than $23,000. The data revealed that 46.2 million people, or roughly one in six Americans, lived in poverty last year. That’s right, one in six.

Now I know what some of you are thinking. Heck, it’s my first reaction: Well, that’s a damn shame. I’m not doing as well as some, but I’m not as bad off as others.

Here in Texas, where I live, a lot of people are pretty well off. And a whole lot of people aren’t. Despite our oil and gas wealth and success at job creation, Texas had the sixth highest poverty rate among the states in 2011. About 4.5 million Texans, or 17.4 percent, lived in households with incomes below the federal poverty line, and that included nearly 1.8 million children, or 25.8 percent of all Texas children.

Not only do one out of every four children in Texas live in poverty, but the Lone Star State has the highest uninsured rate in the nation with more than 6 million people lacking health insurance in 2010, representing nearly 24 percent of the population, according to the Austin-based Center for Public Policy Priorities. The state has the second highest uninsured rate for children, behind Nevada, the center said.

I’ve attended a number of economic development conferences this year in multiple states, spoke at a number of them (hint hint), and have noticed that poverty is seldom mentioned, much less discussed in any detail, which I find a bit curious.

The subject is not on the agenda of the upcoming Texas Economic Development Council, which I plan to attend in a few weeks, although “How Texas Got On Top,” is a prominent subject. Some professor from California is going to tell us and I look forward to hearing from him.

Now please understand that I am not slamming the TEDC. My friend Carlton Schwab, president of the group, agrees with me that economic developers don’t talk much about poverty per se, although the profession addresses the subject in a roundabout way.

While I have read definitions ad nauseam on what defines or constitutes economic development, I think most economic developers just want to increase the level of wealth and quality of life in their respective communities. (Although most will be judged in terms of job creation.) It’s that rising tide lifts all boats mentality, which I think is appropriate.

“Years ago, there were many more of those ‘war on poverty’ guys who were involved in many of the federal programs. But those folks, many of whom came out of LBJ era, are largely not out there anymore,” Schwab said. “So what motivates us? Why do we live and breathe this stuff? Well, it is about helping people. That’s why we do what we do.”

When I visit communities, economic developers invariably want to show me quality of life factors that they are proud of and they should. I do want to see the nice subdivisions with the manicured lawns and your country club. But I also want to see the poor parts of town, which will sometimes raise an eyebrow. (The way I see it, a potential corporate client will want to know about the good, the bad and the ugly.)

You see, unlike some folks, I don’t blame the poor for being poor. Life’s circumstances can throw a person or a family into dire straits with the loss of a job. And despite the fact that 12.5 million people in this country are unemployed, many job recruiters and prospective employers will still look at an unemployed person with a sort of distain and suspicion. Well, what is wrong with you? Why are you unemployed?

I spoke to a friend of mine, a very talented economic developer who I truly love and respect, and broached the subject of poverty with him. This man is a compassionate guy, and active in his church. But he surprised me by essentially blaming the poor for being poor and/or jobless.

Essentially, he said this (I am paraphrasing): Most of them are unwed mothers who couldn’t pass a drug test, and won’t get off their backsides to help themselves.

Granted, we make choices in life and some of those choices are bad and have lasting repercussions. But to suggest that the poor essentially deserve what little they have for the lack of trying. Well, I was surprised my friend said that. And he is a friend and will remain a friend. We just see this one differently.

Earlier this week, I also spoke to a Texas medical researcher who suggests that certain “neglected tropical diseases’, which we ordinarily think of as confined to developing countries but are found in poor neighborhoods in our country, will essentially trap its victims into a life of poverty. In other words, if you get this disease, because of what it does to you physically, it almost ensures that you will not be able to significantly improve your station in life.

Peter J. Hotez is the dean of the National School of Tropical Medicine at Baylor College of Medicine and the president and director of the Sabin Vaccine Institute and Texas Children’s Hospital Center for Vaccine Development in Houston. He is the author of the book, “Forgotten People, Forgotten Diseases.”

“The neglected tropical diseases thrive in the poorer South’s warm climate, especially in areas where people live in dilapidated housing or can’t afford air-conditioning and sleep with the windows open to disease-transmitting insects. They thrive wherever there is poor street drainage, plumbing, sanitation and garbage collection, and in areas with neglected swimming pools,” Dr. Hotez wrote.

“Most troubling of all, they can even increase the levels of poverty in these areas by slowing the growth and intellectual development of children and impeding productivity in the work force. They are the forgotten diseases of forgotten people, and Texas is emerging as an epicenter.”

Now at first blush, it might seem that I am picking on my home state of Texas. Actually, I am not. I love Texas. I actually chose to live here and have no regrets. But it’s not the land of milk and honey. No place is.

Despite the so-called Texas miracle in terms of job creation, this is a state plagued with certain problems, some of which are in the incubation stage. Economic developers openly worry about the billions cut from education and the possible ripple effects to come.

The Census figures released last week show that the income gap between rich and poor Americans grew to the widest in more than 40 years in 2011 as the poverty rate remained at almost a two-decade high. I don’t think that means that poor people are getting dumber or more lazy. No, something else, something more ominous is at work here when the numbers show that median household income fell for most people in this country.

In 2011, median household income of $50,054, adjusted for inflation, was 8.1 percent less than in 2007, the year before the Great Recession began.

“The gains from economic growth in 2011 were quite unevenly shared as household income fell in the middle and rose at the top,” Robert Greenstein, president of the Center on Budget and Policy Priorities in Washington, said on a conference call with reporters.

So it’s not just the poor that are hurting, the middle class has been taking in on the chin, too. But heck, you knew that. But I have to think that it is in all of our best interests that we concentrate our efforts on not only stopping the erosion of the middle class, but also extending help to the poor. And aside from the Judeo-Christian ethic as being the right thing to do, there is an economic case to be made.

As more and more children grow up in poverty, it will invariably lead to higher health-care costs, lower educational levels and reduced worker productivity, none of which is good for our nation’s future competitive standing in a global economy.

I am not advocating that big government solves all. Big government can’t and won’t, especially with the spending reductions that will have to come down the pike, no matter who wins the White House in November. Our debt crisis is real and growing.

But policy matters and to that extent, we really are in this boat together.

Dean Barber is the principal of Barber Business Advisors, LLC., a site selection and economic development consulting firm based in Plano, Texas. He can be reached at 972-767-9518 or at dbarber@barberadvisors.com Please visit our website at www.barberadvisors.com

Blah, Blah, Blah

In Uncategorized on September 9, 2012 at 10:32 am

After watching both the Republican National Convention in Tampa and the Democratic National Convention in Charlotte, a wonderful cartoon by Gary Larson of the Far Side came to mind.

Under the caption, “What we say to dogs,” a man is pointing his finger at his dog and exclaiming: “Okay Ginger! I’ve had it! You stay out of the garbage! Understand, Ginger? Stay out of the garbage, or else!”

Under the caption, “What they hear,” Ginger is looking attentively at her owner. “blah blah GINGER blah blah blah blah blah blah blah blah GINGER blah blah blah blah blah.”

I can kinda relate to that dog. It’s not that I do not understand the words. I do. I just wonder if they (the politicians who spoke) understand what we might be hearing.

Ok, so here is my take on the politics of the day. Neither presidential candidate, in my opinion, has laid out a detailed plan on what he would do if he were to prevail in the upcoming election. We can listen to all the blah blah, some of which we may actually agree with, but we can only guess where they might take us.

The truth is that no matter who wins, the other side will have a powerful say (translation: blocking action) in the journey ahead. Gridlock rules in the nation’s capital. That certainly has been the playbook of House Republicans, since the election of Barrack Obama. Compromise, a key component of governing, is not and has not been in the lexicon.

With that backdrop, what has happened? Where are we? There is no question that fear, trepidation and uncertainty seems to dog us. We take two steps forward and then one step back.

The markets are doing  very well, trading at a near five-year high, and corporate profits are doing very well, indicating that there are strong underpinnings to the economy.  And yet 12.5 million Americans remain out of work and millions more are underemployed.

At first blush, the latest jobs report released Friday might sound promising – unemployment dropping from 8.3 percent to 8.1 – but the job growth of 96,000 was actually quite anemic. That’s because another 250,000 people took themselves out of job market. Discouraged, they simply quit looking and took themselves out of picture. Most experts say we need to pick up 150,000 jobs a month just to keep up with population growth.

Now this might sound a bit crazy, it might not sound right, but it’s true. We’ve actually had 30 straight months of job growth with 4.6 million jobs created. During that time, about 500,000 manufacturing jobs (which I believe is key to America’s future prosperity) were created, although we lost 15,000 manufacturing jobs in August.

But we all know this election hinges on more than just the numbers. It’s about how we feel, where we are and where we are going. And the fact is that people are frustrated, scared and even angry, which is quite understandable.

You see, the middle class, that great sea of most of us which truly moves the economy, has been under assault for the past 30 years, with declining net worth, stagnant wages, and mortgages under water. But hell’s bells, you knew that. You read.

To that extent, the Romney camp wants to couch the upcoming election in terms of a referendum. Do you feel good or bad about our direction (66 percent of Americans do not believe we are heading in a good direction).

Rather than paint Obama as a foreign socialist in secret league with those who hate America and white people (the Glenn Beck crowd), which turns off independents like me, the Romney campaign now couches their argument in more reasonable terms. Obama is a nice guy, good family man, but he’s just over his head. He doesn’t understand how business works, much less how to grow the economy.

Should the president be re-elected, America is in store for continued high unemployment and stagnant wages, according to Romney.

By the Republican scenario, you are a baseball manager watching your pitcher on the mound and he is not getting the job done by your estimation. He needs to be pulled off the mound to be replaced by a reliever. Mitt is that reliever. He is Mister Fixer.

The Obama camp is playing a defensive game, which is what they have to do. They want this election to hinge on choice. We have shown results, they contend, certainly not the results we had all had hoped for, but our plan is making consistent gains from the economic collapse that took place under the administration of President George W. Bush.

In his speech at the convention, the president gave a very cautious, workman-like speech. It was not a particularly lofty effort. In my view, the best defense came not from Obama but from Bill Clinton, who has an incredible knack of boiling things down to their simplest core.

“In Tampa, the Republican argument against the president’s re- election was actually pretty simple, pretty snappy. It went something like this: ‘We left him a total mess. He hasn’t cleaned it up fast enough, so fire him and put us back in,’” Clinton said.

“President Obama started with a much weaker economy than I did. Listen to me now. No president, no president — not me, not any of my predecessors — no one could have fully repaired all the damage that he found in just four years.”

Now whichever way you vote, you have to admit ol’ Bill has a powerful argument. With the damage done, with the economy truly on the brink of spiraling into something even much worse than the fire that we survived, could any president have done much better?

Well, that’s your call. I’ll not try to sway you.

When asked by a journalist what grade he would give himself for his first term, the president’s reply was “an incomplete.” No doubt, some of his campaign handlers probably winced with that answer, thinking that he should have given himself an “A” for effort. An incomplete might be pretty accurate, but it’s not a good grade.

A friend of mine, an economic developer in Louisiana, told me that he voted for Obama the last time but will go with Romney this time around. In his opinion, which I respect, the president has not performed as well as he could. My friend believes we need that reliever to come in and save the game.

I am reminded by an analysis that I heard given by a political professional who likened the president to a football coach who can give a wonderful locker room speech to his team but still continues to lose games. Then there is this data and charts technocrat (Romney), awkward, distant, and not so likeable, but maybe, just maybe, there is deep competence there. Maybe Mr. Robot can actually get the job done and get Americans back to work.

As an independent occupying the middle ground, I’m not sure. I’m leaning, mind you, but I remain undecided. The base – from the right and the left – often spew rhetoric that simply turns me off. I want solutions, not demonization of the other side. I want vision for the future and I want results.

From the GOP, I am disdainful of suggestions that the president is somehow un-American, a socialist, and “not one of us,” and a purposeful “destroyer of wealth” as one business school professor once opined to me.

From the Dems, I do not care for this underlying theme, espoused by some, that corporate America is somehow evil. Those are both big turnoffs for me from both parties.

So your all-knowing, sage-like consultant will probably make his final decision after the debates, to which I may give the advantage to Romney, as he is the more experienced debater. We’ll see.

I like the sometimes professorial and yet affable Barrack, and I also see value and even compassion in the CEO Mitt, who would enter the White House with far more executive experience than his predecessor. Both men have their strengths, and the Republic will survive whichever one of them takes the oath of office in January. But there are clear choices to be made as there are big policy differences between the two.

I am in the minority by occupying the middle ground. I’m not in the base of either party. But my group, even if it is relatively small, will be the deciders. The middle, the independents, will choose who occupies the White House come January.

Finally, there is a presiding feeling among many that President Obama is anti-business. I think they say that, believe that, because the president has bandied about some rather reckless terms. Calling certain business people “fat cats”  is no way to endear yourself to Wall Street, which is now siding with Romney.

Mort Zuckerman, publisher of US News and World Report and the New York Daily News, has altered his views, a sentiment that seems pervasive in the business community. A one-time supporter of the president, Zuckerman now sees the president as the divider in chief.

“I happen to have been an Obama supporter and the Daily News endorsed him. I will point out something unique to this administration and that is they have absolutely displayed a hostile attitude to business and finance that really is pervasive now in the business community, and I think that really affects the level of confidence and optimism that the business community feels.”

I do not have space to elaborate on Mr. Zuckerman’s views. But in love, war and politics, perception more often than not is reality.

Stay tuned for our continuing national saga.

Dean Barber is the principal of Barber Business Advisors, LLC., a site selection and economic development consulting firm based in Plano, Texas. He can be reached at 972-767-9518 or at dbarber@barberadvisors.com Please visit our website at www.barberadvisors.com

Spitting Blood and Gravel; Our Vast Seas Below

In Uncategorized on September 3, 2012 at 12:08 pm

First, I will tell you my rather humiliating story, which is really of no great importance, but I thought it might amuse you to be reminded that things never fully go according to plan.  There’s always a gremlin at work somewhere.

Then I want to tell you why leadership matters and how energy independence for our nation truly is achievable. Now that is important.

I arrived at my hotel, bruised and bloody, feeling as if I had been drop kicked by Bronko Nagurski. But despite my disheveled appearance, I had not been mugged or engaged in fisticuffs. Rather, I was attacked by a gasoline pump hose just outside Rogers, Ark.

Apparently this gas hose took great exception to me trying to step over it and, as a result, down went Barber. I literally broke the fall with my face.

For a few moments, I lay prone, spitting out gravel, and trying to understand just what had happened.  When I saw blood on the pavement, I knew this was not going to be good.  I grabbed my scarred glasses lying nearby and slowly got to my feet, all the while looking around to see if anyone had seen my disgraceful tumble. Apparently, nobody had.

Then I grabbed napkins inside my truck to staunch the free flow of blood. There was a lot of blood.

Two hours later, I attended a dinner of the Arkansas Economic Developers with a big honking band aide across the bridge of my nose. I was still feeling a bit woozy and it was difficult for me to follow conversation at the table. My left arm was swollen and throbbing with pain.

A friend who sat beside me at the dinner noticed my discomfort and escorted me back to the hotel early. He loaded me up with ibuprofen, and I went to bed wondering how and if I would pull off my presentation the next day.

Well, the next day came and I gave my presentation on business retention and expansion to a roomful of economic developers. And I think, at least I hope, that my audience got some value from it. My address was subdued, minus the usual cat and chainsaw juggling this time, because I had been slapped down to earth, literally, and was still feeling the effects. A week later, as I write this blog, my left arm is still sore.

So what is the purpose or moral of my story? Twofold.

First, watch out for gas pump hoses. They are treacherous and will strike when you least expect it. Second, the show must go on.

A special thanks to my kind hosts — Susie Marks, with the Arkansas State Chamber of Commerce, and  Joey Dean, with the Little Rock Chamber of Commerce. When Joey first saw me not long after I bit the ground, he said, “Dean, do you need to go to the hospital for stitches?”

I did not need a hospital. At that point, all I needed was to call my wife, Tera, and hear her cackle with laughter as I told her of my disgraceful fall. Such is life.

The Fayetteville Shale Plays Big

Whenever I go to an event, I almost always learn something new about a place where the event is being held. In the case of Arkansas, I had no idea, had never even heard of the Fayetteville Shale play. But it has brought about billions of dollars to the state of Arkansas and has resulted in thousands of new, high-paying jobs.

Now that is something worth learning more about. Energy has always been a big interest for me, partly because I believe our nation’s fate and future prosperity is so very much tied to it. For more years than I care to remember, dating back at least to the 1973 Arab oil embargo, politicians of every stripe have been blathering on about energy independence.

Now we have a chance to do something about it.

But before I dwell on our lack of a cohesive energy policy in this nation, let me tell you about what I learned about the Fayetteville Shale play in nine counties in the northern part of Arkansas.

As of 2011, the number of people employed by the oil and gas industry in Arkansas directly related to Fayetteville Shale play was 7,544 (at an average annual wage of $74,555) and another 22,499 in indirect or spinoff jobs, according to Kathy Deck, director of the Center for Business and Economic Research in the Sam M. Walton College of Business at the University of Arkansas.

Production of natural gas from nine Fayetteville Shale counties increased from 100 million cubic feet in 2004 to 943.6 billion cubic feet in 2011. More than $12.7 billion was invested by energy companies in the nine counties from 2008 to 2011, generating total economic activity of more than $18.5 billion. As a result of this production, the Fayetteville Shale counties collected almost $109.2 million in additional property taxes.

According to Ms. Deck’s research, because of the Fayetteville Shale activities, taxes on employee compensation, indirect business taxes and fees, household taxes, and corporate taxes netted the state and local governments almost $2 billion from 2008 to 2011.

Clearly, natural gas has had a sizeable economic impact in Arkansas. Clearly natural gas could have a huge impact over our nation’s future and fortunes if only we recognize the opportunities and act.

Frankly, I don’t think we know just how much natural gas that we are sitting on. Back in 2000, some experts actually warned that we might have only have seven years of production left of natural gas. Now I see estimates ranging from 125 years to 300 years.

The U.S. Geological Survey has increased its estimate of recoverable natural gas from the Marcellus shale, encompassing parts of New York, Pennsylvania, Ohio and West Virginia, to 84 trillion cubic feet. That’s 42 times higher than the previous estimate in 2002.

So it is becoming apparent that we are the Saudi Arabia of natural gas. Our country probably has more of it than anyplace in the world. We are sitting vast seas of natural gas trapped in shale rock formations in various parts of the country and we still keep on finding more.

And here is the deal, natural gas is way cheaper and way cleaner than dirty OPEC oil and it’s here.  As I earlier mentioned, for 40 years, we have been hearing the politicians prattle on about energy independence. Well, I think it is about put up or shut up time.

The truth is that we actually can become energy independent as a nation and thereby create hundreds of thousands if not millions of jobs and revive a limping economy (and protect the environment) if we only exert the leadership to make it happen. Now how do we do that?

Well, first you listen to people who know what they are talking about. When it comes to energy, T. Boone Pickens, who released his own energy policy proposal in 2008 called the “Pickens Plan,” is the man.

“Properly managed energy can bring back the economy,” said Pickens, who has presented his ideas for solving America’s energy problems to both President Obama’s administration and Republican presidential candidate Mitt Romney’s camp.

In an essay published by National Review Online and co-written with R. James Woolsey, former director of the Central Intelligence Agency, Pickens says that as long as OPEC has America over a barrel, we are vulnerable to our economy being shaken to its core, and we will continue spending untold billions that don’t have to be spent.

“No amount of increasing mileage for America’s car and light truck fleet can solve the “central” problem of OPEC simply cutting output to keep supplies tight and prices high. Increasing domestic oil production will not solve the problem because domestic prices would simply follow global prices up and down,” Pickens wrote.

“The only solution is to move from dirty, imported, expense diesel – largely refined from OPEC oil – to clean, domestic, cheap natural gas; especially for heavy duty trucks.”

Pickens contends that transitioning the nation’s heavy-duty and fleet-vehicle market to compressed and liquefied natural gas (30 percent cleaner than diesel and with a savings of $2 per gallon) would create more than 400,000 new jobs and cut OPEC dependence by 70 percent.

During the Republican National Convention in Tampa last week, Pickens ran an ad highlighting his views. I expect he will run the same ad this week for the Democractic National Convention in Charlotte.

“OPEC oil has dictated our foreign policy and at times crippled our domestic economy. Even today we are dependent on other countries’ oil for over 60 percent of our country’s needs.  … We risk the lives of American soldiers and spend hundreds of billions of taxpayer dollars to keep oil flowing through the Straits of Hormuz. It’s time to sober up and work our way out of this hole before it’s really too late.”

Recently on the MSNBC cable network show “Morning Joe,” Pickens said that out of the 17 million barrels of oil that pass through the Strait of Hormuz on a daily basis, only about 15 percent, or 2.2 million barrels, goes to America.  And yet we spend billions to keep a military presence there to ensure that the oil flows. It doesn’t have to be that way.

Using the resources that we have, which apparently are vast seas of natural gas in North Dakota, Texas, Pennsylvania, Ohio, West Virginia and Arkansas, among other places, can break our OPEC oil addiction.

According to Pickens, this is not rocket science. This is leadership. And apparently, that’s been in rather short supply.

Dean Barber is the principal of Barber Business Advisors, LLC., a site selection and economic development consulting firm based in Plano, Texas. He can be reached at 972-767-9518 or at dbarber@barberadvisors.com Please visit our website at www.barberadvisors.com