Coming in on a Wing and a Prayer

During his criminal career, Willie Sutton stole an estimated $2 million. Willie reportedly said that he robbed banks because “that’s where the money is.” If you are in the robbing business, that makes a great deal of sense.

Conversely, if you are in the business of manufacturing, having operations in the United States may make a great deal of sense. Ours remains the biggest consuming economy in the world. This is where you can sell your stuff in greater numbers. This is where the money is.

This past week, I had preliminary discussions with a foreign company that wants to have a manufacturing presence in the U.S., because it believes there is a lucrative market here for its products.  This company wisely recognized that site selection for a future plant is not one of its core competencies, but that it is for me.

Now if I do my job right, I will save this company time, money and heartache. In doing so, I will take them where they need to be and not some personal favorite place of mine. That’s my pledge. I hope that we can come to agreement where I can be of service. 

If They Build It

That desire for a physical presence is a key driver to why the U.S. remains the largest recipient of foreign direct investment in the world. ($257.5 billion in 2011.) There is this instilled belief that if they build it, they (their customers) will come, which is always a gamble.

I once helped a Canadian automotive supplier set up a plant in which I know the company had virtually no established orders to support that plant. They built it on the sheer belief that the business would follow. They were coming in on a wing and a prayer.

I think it is noteworthy that the company that I was speaking to this past week wants a U.S. manufacturing presence despite the fact that production costs would be lower in their home country. They figure, correctly I believe, that just being here will give them a competitive edge by stirring up more orders. And yet, we are a higher cost environment.

In a speech earlier this month at the Detroit Economic Club, Jay Timmons, president and CEO of the National Association of Manufacturers, said this: “It is 20 percent more expensive to manufacture in this country than it is anywhere else in the world – a direct result of years of policy choices made in our nation’s capital.”

I included that quote in my blog last week, which prompted a friend in the People’s Republic of Austin (a place that I actually like very much) to write to me to say, essentially, that he didn’t believe it. As my friend will never let me off the hook, it is now incumbent on me to prove to him (and you) that Mr. Timmons ‘ remarks were accurate.

Only France

Well, maybe not quite. Among the US’s largest nine trading partners, only France has higher structural costs, according to the Manufacturers Alliance for Productivity and Innovation. Since 2003, MAPI and The Manufacturing Institute has been tracking the burden of structural costs – corporate tax liability, employee benefits, tort litigation, regulatory compliance and energy – of U.S. manufacturers relative to their counterparts in our nine largest trading partners. The bad news is that our cost disadvantages have not been falling.

“Structural costs in 2011 were 20 percent higher than for our major competitors, up from 17.6 percent in 2008. That cost differential excludes the cost of labor.” That is a direct quote from the ninth edition of the report “Facts About Manufacturing,” published in November 2012 by NAM, MAPI and the Manufacturing Institute.

The good news is that we have experienced a 50 percent increase in productivity since 2000. Those productivity gains would have made the U.S. a lower cost platform were it not offset by costs essentially created by our own government policies. Subsequent to a corporate tax reduction in Japan last year, the US now holds the unenviable position of having the highest combined federal-state statutory corporate tax rate in the world.

If the U.S. were to reduce its statutory corporate tax rate from its present 35 percent to 24 percent, it would add $500 billion to GDP and create 2 million new jobs within five years, according to MAPI. In his Detroit speech, Timmons said we need to go farther than that.

“We hear policymakers on both sides of the political aisle talk about reducing our corporate rate to 25 percent or so. But the average tax rate of our trading partners was 25 percent five years ago, and I don’t think we became the great country we are today by striving to be average,” Timmons said.

“Today, that average rate is around 23 percent, so we are already starting at a disadvantage if those proposals become law. We need to be bold. We need to be looking at the example of your neighbor just over the bridge. Canada lowered its rate to 15 percent, and we need leaders to propose an equally competitive rate.”

They May Say It

Now I have heard President Obama say that corporate tax rates need to be lowered. I have heard Congressmen and senators of both parties say the same thing. But I think we all know that is not going to happen anytime soon, because Washington is effectively broken.

I think the president cares about manufacturing. His idea offered in his State of the Union address for the establishment of 15 manufacturing research hubs around the country is a commendable idea. His administration, too, has made progress in growing our manufacturing exports abroad. Both Republicans and Democrats are giving at least lip service to the notion that our country must have a growing and vibrant manufacturing base if we are going to have any sort of a better future.

But that is where it stops. Getting them to agree on anything of substance appears to be beyond them. These people that we have sent to Washington took the nation to the brink of the fiscal cliff last month and now they are doing it to us again. Most economists say the spending cuts that will kick in with this manufactured thing called sequester could result in the loss of up to 750,000 jobs and a reduction of GDP growth by a full point.

Both parties theoretically agree that spending cuts have to happen to get a handle on our nation’s long-term debt, now at $16.5 trillion. But coming up with a compromised solution on how to get there, well, don’t hold your breath.  I only wish we recall the whole bunch of them and replace them with pragmatists who are not wedded to political grandstanding but toward actually getting work done.

I realize that I am ranting, if not singing to the choir to many of you. (I make no appeal to the wingnuts on the extreme right or left) But I have to think that our elected leaders in Washington don’t get it. I don’t think they understand that they are the principle reason why business in the country remains very wary about investing and hiring. This gang that cannot shoot straight is actually inhibiting economic growth.

“This type of week-by-week, month-by-month budgeting is having major repercussions not only in manufacturing, but in business in all sectors,” Timmons said in his Detroit speech. “Manufacturers don’t plan months ahead. They formulate business plans that project out years ahead. The uncertainty created by these never-ending budget showdowns is preventing manufacturers from taking risks and growing their business.”

Regulators Going Unchecked

Add to that reality the fact that regulators in Washington are going largely unchecked, imposing new costs and additional uncertainty on manufacturers. Now it would be easy for me to put all or at least most of the blame on the current occupant of the White House. But I am not sure that would be accurate or fair.

“Presidents of both parties are to blame. In the past 30 years, according to the Manufacturing Alliance, more than 2,000 regulations have been imposed on manufacturers,” said Timmons.

In the November FACTS report, it said that manufacturers are spending $192 billion annually to be in compliance in federal regulations. Now I am all for regulations within reason. If I am getting on airplane, I want to know that it has been inspected. If I am going under the knife, I want to know that surgeon is board certified and meets certain requirements. I think most Americans, including most business people, favor reasonable regulation to weed out potential bad actors and bad behavior.

But our manufacturers are paying the equivalent of an 11 percent tax in order to comply with a growing mountain of regulations, according to the FACTS report. This regulatory burden goes beyond the pale, thereby discouraging investment. In fact, it may have encouraged certain companies to locate production abroad.

This is one area where I think President Obama could prove himself. If he is truly is an ally of U.S. manufacturers, he could put out a directive tomorrow to all appropriate federal agencies that there should a systematic review and reduction/elimination of unwarranted regulations now on the books. If he could pull that off, not just say it but do it, that would send a huge message to manufacturers big and small (and most are small) and you would see more corresponding investment in this country.

I am certain that this foreign company that I am talking to is well aware of the challenges of operating in the US. Still, they want to be here, and I want them here, too. It will be good for them, despite the impediments thrown up by Washington.

The truth is that the US remains the big Kahuna with a GDP of $15.7 trillion. Our economy is almost twice the size of hard charging China at $8.3 trillion. When you play here, you’re playing in the major leagues.  And that’s the way it should be.

I’ll see you down the road.

Dean Barber is the president/CEO of Barber Business Advisors, LLC, a site selection and economic development consulting firm in Plano, Texas — www.barberadvisors.com He can be reached at 972-767-9518 or at dbarber@barberadvisors.com

 

 

 

 

 

 

 

A Tale of Two Cities (Actually Three)

“What about manufacturing?”

I thought my question was simple and even logical but it seemed to take my hosts by surprise. In two subsequent meetings in two neighboring cities, I asked both city managers if they had any plans for future industrial growth.

Neither did.

Both communities straddled an interstate highway and while they still retained somewhat of a rural, agricultural nature, it was clear they were bedroom communities for those driving elsewhere to work. Elsewhere was a major US city with an NFL franchise, about 30 miles away.

Median household income was higher, in the $60,000 range, and newer subdivisions were on the upper end, with homes in the $250,000 to $300,000 range. Again, keep in mind where we are (for now) – the outskirts of a major metropolitan area.

Knowing full well that land is not a site but that land, with proper investment can become a site, a brief eyeballing indicated to me that industrial properties could be possible if the suitable infrastructure was there or could be there. Always big ifs.

But when I raised the specter of industrial use with our city managers, you would have thought that I was suggesting an alien space invasion. Both made it very clear that retail was their highest and really only priority.

What Retail Offers

And I understand that, even if I do not necessarily agree with it. Stores bring in sales tax monies, monies that go to the coffers at City Hall, giving our city managers more play dough, or, to be kinder, more budget breathing space. In short, sales tax dollars can fuel the pump.

(And in Texas, sales tax dollars can enrich certain qualifying local economic organizations. I know of single person ED shops with millions in the bank.)

Retail can also add to the quality of life. It’s no fun driving 10 miles in the middle of the night for a stick of butter because your wife is baking a cake and is demanding you to get hopping. (Trust me, I know something about this.) A well placed grocery store or pharmacy can be a quality of life godsend to a small community.

For the two neighboring communities, I had to wonder why a manufacturing component was at least not being considered. I was there at the request of a friend, a real estate developer, who was planning for retail but wanted to see a manufacturing presence to essentially support the retail developments that he would sink millions of dollars into. In follow-up emails to city officials, I was probably too plainspoken in suggesting that pursuing a retail-only strategy was short sighted.

“But retail will never build wealth in local economy and or provide for quality jobs. Manufacturing jobs are high-quality, good-paying jobs. Manufacturing workers earn more than workers in other industries—about $77,000 compared to the average $60,000 in other sectors. Then there is manufacturing’s multiplier effect. For every $1.00 invested in manufacturing, another $1.48 of economic activity is generated elsewhere,” I wrote.

I should have pointed out, but didn’t, that retail has a much lower multiplier effect, generating only 54 cents for every dollar invested. Leave to say, my argument probably did not resound very well, as I received no reply.

And while I do not know for sure, I suspect our city officials may hold skewered views on what manufacturing is. Parents and educators also hold some misperceptions on manufacturing – believing that it offers only dirty, potentially dangerous and dead-end jobs. Nothing could be farther from the truth.

Deader Than Dead

But the truth will sometimes be damned. It is perceptions, particularly erroneous perceptions, that can so often kill a project deader than dead. As a site selection consultant, I want to take a corporate client only to those places where the company will be rightly viewed and welcomed as an investor, a job creator, and a corporate citizen within that community. This is particularly true if that client is a manufacturer.

If we’re not welcomed, we’re not coming. It’s as simple as that, even if all the other locational criteria and perimeters may point your way.

If a community doesn’t view manufacturing as a viable option in a strategy of wealth building within its local economy, you can bet that the chances are correspondingly great that they won’t be getting any or at least many looks. For starters, they are unlikely to have the ready-to-go sites as required by a corporate client that I or any other site selection consultant would represent.

Carve You Out a Spot

I was in another rural community recently, this one in Texas. The town, which was about an hour away from the nearest interstate, had come up with an interesting business development strategy by suggesting that it was essentially one big virtual industrial park. The message was, in short, this: “You just tell us what you need and we’ll find you the property and carve you out a spot.”

The problem is that it doesn’t work that way. Site selection is about viable sites, not land. More often than not, when a company needs a plant site, it needed it six months ago. It wants to move onto a prepared industrial site where the delays are few and the risks minimized. Raw land, even strategically located raw land, can never offer that.

This community reasons, wrongly, why should we spend the money on infrastructure when we don’t know what the needs are for a future industrial user? My answer to that is simple: By not offering viable “product,” you are taking yourself out of the ballgame. It’s that simple.

This is the whole reasoning behind the certified-site movement of recent years, a trend that will only continue to grow as communities seek to be more competitive in their efforts to attract manufacturing.  In short, it’s about addressing risk from the standpoint of the corporate end user.

You may want to take a look at a past blog that I wrote on this subject (and, yes, site certification is a service that I do offer) – “Site Certification: Saddle Up Old Kate.”

A Dirty Little Secret

If there is a dirty little secret to these two neighboring towns on the interstate and the Texas town an hour from the interstate, it may be this: They may not have the skill sets within their communities to attract the manufacturers of tomorrow, which essentially now demands that everyone on the plant floor be a problem-solving junior engineer.

The human element ranks up there with logistics and transportation as a key factor in where manufacturing capital is invested. That interstate highway is important because most manufacturers continue to ship product by truck. But people make it work (or not work.)

Manufacturing may need fewer people because of robotics and advanced technologies, but it surely needs smarter people – those equipped with technical skills to again solve problems and operate and maintain very sophisticated machinery that can cost in the millions, even tens of millions of dollars.

Unless he is attending tech school courses at night, Bubba working the counter at the bait shop probably need not apply. That goes for Sheila, who does nails, or Charlie, who works the grill at Burger Doodle. Without the needed skills, they will not fill the bill for the manufacturers of tomorrow.  It is sad but true.

Staunching the Bleeding

Much has been written about a manufacturing renaissance happening in this country. It seems like you cannot swing a dead cat without hitting a magazine story about a manufacturing revival that is supposedly happening. (Note: I do not pick up dead cats much less swing them. I actually like cats although few have ever liked me.) I guess if staunching the bleeding is a revival, then we have done that.

In his state of the union address to the nation on Tuesday, President Obama spoke of the creation of 500,000 manufacturing jobs in the past three years. Most economists think we may pick up 150,000 to 200,000 manufacturing jobs in the coming year. But keep in mind this, from 2000 to 2010, we lost 6 million manufacturing jobs, a full one-third of our manufacturing base.

A day after the president gave his speech, a more fascinating speech from my perspective, was given in Detroit by Jay Timmons, the president and CEO of the National Association of Manufacturers. He said, correctly, that all is not well with U.S. manufacturing.

“Unfortunately, manufacturing today is not where it needs to be,” Timmons said. “It is 20 percent more expensive to manufacture in this country than it is anywhere else in the world – a direct result of years of policy choices made in our nation’s capital.”

And that is what we are going to talk about in next week’s blog – our competitive standing in the world. It means a lot to every American, even to those who live in places where manufacturing is not on the radar screen.

I’ll see you down the road.

Dean Barber is the president/CEO of Barber Business Advisors, LLC, a site selection and economic development consulting firm in Plano, Texas — www.barberadvisors.com He can be reached at 972-767-9518 or at dbarber@barberadvisors.com

 

 

 

 

 

 

 

 

Kids Don’t Try This at Home

“Go Greyhound and Leave the Driving to Us” was an advertising slogan started by Greyhound Lines Inc. in 1956 and one that I grew up with as a child. I was reminded of it recently when I received what can only be described as a curious email.

It was a county commissioner on the Gulf of Mexico who was writing to me. His county  apparently had been damaged and then subsequently compensated by BP because of the 2010 Deepwater Horizon oil spill.

There is no surprise that BP would have to spend billions of dollars to compensate state and local governments for what was the largest accidental marine oil spill in the history. But I was somewhat surprised that this county commissioner was using this new found money as a dangling lure directed at site selection consultants.

“A large portion of the dollars will be utilized for economic development and job creation. Do any potential projects or opportunities come to mind? We have a responsibility to be as efficient as possible leveraging these incentivizing funds in the best interest of our citizens and of our local economy. My personal cell number is xxx-xxx-xxx.”

From my standpoint, this elected official, well intentioned as he may be, does not understand how the site selection process works, although he does have someone in his backyard who does. The commissioner is under the misguided belief that overt incentives drive that process when it goes far deeper than that.

Do incentives have a role to play in the site selection process? Of course, they do. Incentives are a means and a way for operations to start quicker, smoother and at less cost, all very attractive factors worth considering and even pursuing. Certainly, we will look at incentives and even engage in some hard nose bargaining in the final stages of determining our optimal location.

But are incentives a primary driver in a best location decision making process? Only to someone who does not understand what a site selection consultant is trying to achieve. (And believe it or not, that can sometimes even include the corporate client, at least in the beginning.)

Finding That Better Place

Keep in mind there is no perfect place for business. (Despite what some economic development organizations might claim.) Rather, there are better places where the risks can be better managed and the chances for success can be optimized.

The role of the site selection consultant, if he or she is properly doing his or her job, is come up with a short list of those optimal communities, based on a tailored list of ranking criteria agreed to up front and with a whole lot of analysis and investigation to follow. The criteria will differ because of the specific wants and needs of a company. There is no one size fits all template, although there are logical steps and a pre-defined process to be followed common to most projects.

So in my case, I really want to dive deep with senior management to get a thorough understanding of the drivers of a project and how the company’s core operations work. The better that I understand those things, the very essence of the business, the better that I can serve my client. And sometimes that takes a little teeth pulling on my part.

But my point is this: discussions and considerations about incentives, while of significance, will  come late in the process, not early. I would never advise a corporate client to focus on a particular county on the Gulf of Mexico or anywhere else simply due to the fact that money is being spread around.

Business Not Bait

Rather, we look at those places where it makes the most business sense to expand or consolidate operations. Business reasons for the long haul dictate where we go, not bait. (Having good live bait while fishing in the Gulf of Mexico, well, that is important.)

Of course, we very may well accept offered incentives and even ask for more, but the reason why we are even talking to an economic developer is because his or her community is a finalist in our systematically planned search based on defined locational factors.

In short, if we are even talking to you, it is because we have determined that your community could be a beneficial fit. It’s not the incentives per se, although they can factor in. And it’s certainly not because you have come up with some nifty slogan that A) you think will make a difference B) you probably spent way too much money on and C) which probably makes no sense.

I fantasize that states like Alabama or Mississippi, places that I really like, should have a branding motto something similar to this. “You are most welcome here, but please do not make fun of us as if you are so much smarter, as that could cost you an ass whoopin.”

Of course, that would never be a proper brand message to convey, even if there is a degree of truth expressed. And this is why I do not dwell much on this ethereal notion of brand.

Going back to my original point, the site selection process is about risk management. A bad location decision can prove costly if not deadly for a company as millions of dollars can be at stake. And for that very reason, I would advise that companies to use professional site selection consultants on any major project involving an expansion or consolidation.  

(And incidentally, I would prefer that they hire my company for that specialized task.)

Think Core Compentency

Keep in mind that the site investigatory process is a core competency for the professionals who actually do it. They know how to do it. This is their bread and butter. But site selection is not and never will be a core competency for most companies. They won’t even know where to start, much less how, and they will often display the same naivety as our county commissioner that incentives should be the motivating factor.

Also, if a site selection consultant performs a thorough analysis with recommendations to follow that are heeded by the company, the savings in time and money, much less the impact on the strategic direction of the company, should be substantial. Again, this can be make or break for a company. I do not think our county commissioner understands that.

So you may be wondering about my reference to Greyhound and leave the driving to us. I thought of that because that county from where our elected official was writing to me just so happens to have a very good and experienced economic developer. Actually, he has several.

I will bet that our elected official winged this one on his own by sending me that email without consulting the economic developer in his community. Had he had that conversation, he probably have heard: “Let’s hold off on that, sir.”

So to all you elected officials around the country, I salute you for service and dedication, but if you have an experienced economic developer in your community, by all means please leave the driving to them. That is what they were hired to do.

I know the economic developer in that Gulf state county has a much better understanding of my role and duties as a site selector, because he has a track record of working with companies and other site selection consultants. In short, he is a seasoned pro.

Of course, it takes wins and losses to become seasoned. But those are the people that I prefer to work with. They have been through fire before.

Warning: You Can Get Hurt

“Jackass” was reality series, originally shown on MTV from 2000 to 2002, featuring a deranged crew performing various dangerous, crude self-injuring stunts and pranks. I was drawn to it because I did some incredibly stupid things growing up and yet somehow survived.

The show featured warnings and disclaimers noting that the stunts performed were dangerous and should not be imitated, and that recordings of any stunts would not be aired on MTV. The warnings featured a skull and crutches logo at the bottom of the screen to symbolize the stunt performed was risky.

But, of course, that did not stop the resulting mayhem that followed. The program was blamed for a number of deaths and injuries involving young people recreating the stunts despite the reoccurring message of “Hey kids, do not try this at home.”

For some, it was just too tempting not to try. And apparently, some cashed in the chips trying.

Just as I tell companies that it is too risky for them to try site selection on their own, so too would I advise elected officials to just cool it and allow and support their economic developers to do their jobs. Again, leave the driving to the professionals. Kids, do not try this at home.

Back in the 1968, Dean Martin recorded a song that would probably be offensive to some by today’s standards. It was called “Not Enough Indians” and the common refrain was that “there are too many chiefs and not enough Indians around this house.”

And so it is in some communities where there is no designated and agreed upon chain of command in regard to economic development. Confusion typically reigns, as too many people want be chiefs and thereby seek credit. But they only contribute to a sense of an un-unified team.

In the risk management process, which is the process of site selection, that can be a deal killer. We will go to that community that has its act together. And that’s no matter how much bait might be dangling on a hook.

I’ll see you down the road.

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 http://www.barberadvisors.com

Let’s Get This Thing Done

I am generally quite comfortable in the presence of good old boys.  Mind you, they may have a blind side when it comes to some societal ills, but they usually will not possess the harsh or even outlaw qualities of a brazen redneck. Now, those people do scare me.

Recently, I had dinner at a Mexican restaurant in a small Southern town with the mayor, the local economic developer and the head of a state economic development organization. Nothing said could have been construed as being offensive, much less mean-spirited. Indeed, some funny stories were told that had us all laughing.

During the course of our meal, I learned that the restaurant owner had settled in the town some 18 years ago. He was, in fact, an illegal immigrant. Today, this man is a stalwart of the community, and he serves a mean chicken-shrimp fajita that would rival any I’ve had in Dallas.

The very thought that he should have to shut down his business, pick up his family and move back to Mexico was incomprehensible to the mayor, a good old boy in the best tradition, possessing great “country smarts” and good manners to boot.

Indeed, the mayor, a businessman himself, being a heavy equipment operator, owning a dry cleaners and an auto repair/tire changing shop, has been urging our illegal immigrant business owner to open up yet another establishment in town.

Now I have no idea how this Mexican national was able to pull off what he did and how he remains in business today. (He owns and operates a second restaurant in another nearby town.) But I do know this: He is part of the community now and is well respected.

Obviously, he broke the law by coming into the United States by the manner in which he did. But just as obviously, he has built a life for himself and his family in this small conservative town in the South, where he has proved to be a contributing de facto citizen. I believe his story somehow epitomizes a reality and a need for immigration reform.

The Economics Make It So

I could argue that reform is needed beyond any humanitarian considerations. The economics make it so, as the evidence would suggest that immigrants actually boost American workers’ overall standard of living wages and lowering prices for consumers, according to Michael Greenstone and Adam Looney, with the Hamilton Project.

Generally, immigrants are not competing for the same jobs of US-born workers, but rather complement the work of US employees and increase their productivity. Low-skill immigrants, some of whom may have risked their lives to walk through a desert to get here illegally, allow US-born farmers, contractors and craftsmen to expand agricultural production or to build more homes – thereby expanding employment possibilities and incomes for US workers. 

Businesses adjust to new immigrants by opening stores, restaurants, or production facilities to take advantage of the added supply of workers as more workers translate into more businesses. I see evidence of that in Texas every day.

Granted, there are some estimates that show that immigration, whether it is legal or illegal, has reduced wages for American workers. But other studies would indicate that thanks to the labor of low-skilled immigrants, the cost of food, homes and child care comes down and living standards rise. In short, our purchasing power has been enhanced by their very presence.

And while new immigrants may gravitate to construction and food-related jobs, by the second and third generation, their occupation profiles differ little from those who are native born.

How Did That Work Out for You?

Call it the Law of Unintended Consequences. Passed in June 2011, Alabama’s HB 56 was designed to drive illegal Hispanic immigrants from the state and free up jobs for natives. It served its purpose alright in clearing out the illegal immigrants, but it also left produce rotting in the fields.

I talked to some Alabama farmers. They said they have had to look beyond our nation’s borders for labor, because most Americans simply will not do the backbreaking, low-paying work. But in response to HB56, the farmers tried using local labor to salvage what they could from the fields.

They said that most of the native born who did show up, showed up late, worked slower than seasoned Hispanic farm hands and were ready to call it a day after lunch. Many of the native born quit after a single day in the fields.

And the intended influx in hiring Alabamians to chop chicken didn’t happen either, as too few locals were interested in that work as well. Oakwood, Ga.-based Wayne Farms, which operates six poultry plants in Alabama, resorted to “alternative methods and sourcing.” The company found Africans displaced by war through a labor broker based in West Virginia.

It is apparent the business community is increasingly favoring a guest-worker program for undocumented immigrants. This comes at a time when the GOP is eager to shed its image that it is anti-immigrant and anti-Hispanic. Still, there remain reservations among many conservatives about rewarding legal status to the 11 million immigrants now in the US illegally.

And I understand that. We are a nation of laws and we have every right to secure and protect our borders. I’m all in for teeth and enforcement. But we should be concentrating on violent drug cartels and swiftly deport those who commit crimes and overstay their visas. I just believe that there has to be a better way that would provide for a pathway for legal status and eventually citizenship, if that is what they want, for many illegal immigrants who have and are  building productive lives here.

I cannot help but to agree with former Florida Gov. Jeb Bush and Clint Bolick, vice president for litigation at the Goldwater Institute, when they wrote recently for the Wall Street Journal that “the only tried-and-trued method of reducing illegal immigration is a bad economy. Thus, with a dismal American economy and an improving Mexican one, the net immigration from Mexico is now zero: As many Mexicans are leaving the US as are entering it.”

An Infuion of New Blood

We should always been looking toward the future. No doubt that scares some people as they see a less white America on the horizon, an America drifting toward mediocrity. But I remain hopeful that immigration can serve as an infusion of new blood and new ideas to spur the economy and support our social welfare system.

The truth is the birthrate in the US has fallen below the level necessary to sustain the population at a time when millions of Americans are leaving the workforce and expecting retirement benefits. Immigration can alleviate the worker shortages that will surely come.

Immigrants are 30 percent more likely to start a new business than native-born Americans.  They are more likely to earn patents and a quarter of all high tech startups were founded by immigrants. A study by Madeline Zavodny, an economics professor at Agnes Scott College, found that every additional 100 foreign-born workers in science and technology fields is associated with 262 additional jobs for US natives.

It is true that state and local governments will spend money educating the children of illegal immigrants. But over the course of their lives, those children will pay more in taxes than they receive in benefits. According to the Congressional Budget Office, giving current illegals a path to citizenship would increase the taxes they pay by $48 billion, while increasing the cost of public services by $23 billion. In other words, they would create a $25 billion surplus.

We like to see ourselves as the great melting pot where the great American dream can be achieved and where a rags to riches story can still be embraced. Immigrants, legal or illegal, are not coming here to welch or freeload. Far from it.

“They cherish the values of hard work, faith, family, enterprise and patriotism that have made this country great,” wrote Bush and Bolick. “Meanwhile, many who were lucky enough to have been born here have grown complacent or even disdainful of these values. America’s immigration system should provide opportunities for people who share the country’s core values to become citizens, thereby strengthening the nation as have countless immigrants have before them.”

Comprehensive immigration reform appears to be within our grasp. Both parties seem to be angling toward it. The debate is sure to get emotional, even ugly at times with an “us versus them” mentality that will be espoused by some.

But please allow me to remind you that unless you are Native American, you came from someplace else, too.

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 http://www.barberadvisors.com