Highlights from the Summit:
President Katharine Lyall addresses the opening of the Wisconsin
Economic Summit Begins; Statewide Audience Exceeds 850
Economic Summit began November 29 at the Midwest Express Center
in Milwaukee. More than 850 registered participants from throughout
the state were on hand for a full afternoon of sessions.
Jay Smith and UW System President Katharine Lyall, summit co-chairs,
opened the meeting with a welcome, a "charge," and an
overview of the key issues.
economic future, said Smith, depends on the collaboration of business,
education, government, and communities. He described the summit
as "an unprecedented undertaking" that will make an "historic
imprint on Wisconsin's economic vitality and success."
summits take place during a crisis," added Lyall. "We
do not have a crisis in Wisconsin," where its economy is concerned,
"but we do have an opportunity to build upon past growth now,
when times are good and a strategy for transition to the `New Wisconsin
Economy' can be thoughtfully worked out."
Tommy G, Thompson gave a major address on the opening night
The rest of
the afternoon was devoted to hearing the results of the regional
listening sessions held throughout the state during September, October
and November. More than 1,000 people attended these sessions and
made a significant contribution to the work of the summit.
associate editor of the Wisconsin State Journal, served as moderator
for the 11-member, regional reports panel session. Recurring themes,
noted Still, included:
of an urban/rural economic split in the state,
- the growing
importance (and lack of) venture capital,
- the need
to reward economic risk-taking,
that the state's educational system is strong,
- the importance
of maintaining a strong energy supply,
- the need
to retain and attract high-skill workers,
- calls for
strengthening the road/rail/air transportation infrastructure,
about taxes and government regulation, and
that the state's health care system is strong.
A question and
answer period followed the regional reports. One person noted that
it's possible to infuse traditional industries with new technology,
rather than having to start up entire new high-tech industries.
In other words, you can be a part of the "old" economy"
and the "new economy" at the same time.
Harris of Wautoma (right) asks a question during the regional
All five regional
reports are now available on-line as "white papers" and
PowerPoint presentations at www.wisconsin.edu/summit/
The next session,
entitled "Connecting the Dots: Regional Opportunities, State
and National Policy," featured UW-Madison faculty members Don
Kettl and Don Nichols.
of the Wisconsin Blue Ribbon Commission on State/Local Partnerships,
said "Wisconsin is not just an economy, but a collection of
regional economies." He compared the state to a corporation,
which is only as successful as its subsidiaries. Competition among
regions and communities becomes a barrier to the state's ability
to grow. "Government needs to be a part of this conversation,"
said Kettl, through tax policy, regulation and infrastructure improvements,
so that a collaborative investment strategy for the whole state
can be created.
a national perspective on the discussion, focusing on the lessons
we can learn from Silicon Valley. "It's not all about building
the Internet," he said. "It is about the clustering of
expertise, which is a mode of operation applicable to many industries."
In such clusters, he observed, entrepreneurs meet up with venture
capitalists, can easily outsource for products and services, and
can trade capital for ideas. "This mode of behavior can exist
in the metal industries of Milwaukee," he said, "not just
on the Internet."
What are the
features of the "new economy," asked Nichols? In addition
to the clustering of expertise, it involves close ties with universities.
He wants Milwaukee to have an ambitious vision, one that would attract
high-tech college graduates. For example, Milwaukee could define
itself as a world center for engineering, he said, much as Detroit
has supplemented its assembly lines with research labs.
A lively "town
hall"-style discussion followed. Several panelists cited existing
examples of clustering in Wisconsin, including the University Research
Park in Madison, the Fox Valley paper industry, and institutions
of higher education.
of the first day of the Wisconsin Economic Summit was a major address
by Governor Tommy Thompson. In his remarks, he challenged the audience
to come away from the three-day meeting with an action plan for
shaping the future of Wisconsin's economy.
of using the summit for a conversation about what we should be doing,
we must ask how we will do it," said Thompson. "We must
come together and work together to build the jobs we want for our
children and grandchildren."
his successful action plan for the Wisconsin economy that brought
the state from a recession in the mid-1980s (when the state lost
134,000 jobs and average unemployment across the state was 8.7 percent)
to today's era of state prosperity.
Thompson, state unemployment is among the lowest in the nation,
at three percent, and personal income is growing at close to five
percent per year. More than 700,000 jobs have been created since
1986, he said.
the summit and its goals, but said the discussion of Wisconsin's
economic future is not a new one: "we have been actively building
it for a long time."
One key to
success has been partnerships, said Thompson, and he noted that
the Chippewa Valley's developing high tech industry is one example
of how success can be achieved. It has been based on strong partnership
between educational institutions, community and state and now it
is one of the state's most robust regions, he said.
Among the building
blocks he pointed to has been the state's major investment in education,
especially in the University of Wisconsin System's biotechnology
Chancellor Richard Wells (left) speaks with Rep. Gregg Underheim
committed to make Wisconsin the number one leader in biotechnology,"
said Thompson. In that regard, he said that though the coming state
budget will be tight, "we will go as far as we can to fund
the second phase of the Madison Initiative and the Milwaukee Idea."
gave the business, government and educational leaders a sneak preview
of some of the elements that will be unveiled in his proposed budget
early next year.
he said he wants to guarantee access to the UW System for every
technical college student with a B average, and expand the youth
options program that allows high school juniors and seniors to take
college courses. He also wants the state to continue investing in
youth apprentice programs and he challenged business and labor to
get more involved in these programs and support them as an avenue
to keeping talented Wisconsin students in the state workforce after
In tax reform,
he called for a single tax factor to make Wisconsin even more attractive
to businesses, and an aircraft hub exemption to make Wisconsin more
accessible to business and recreational travelers, and development
zones to encourage clusters of new high-tech businesses.
one threat to Wisconsin's prosperity is the state's fragile energy
supply and he called for more generation, more conservation, and
more transmission capacity while protecting the environment and
respecting the rights of landowners.
said that he would ask the State Investment Board to invest another
$50 million in venture capital, and would host a venture capital
summit early in 2001. He would also like to see state employees
given the option of investing in venture capital as an option in
their retirement programs.
called on Madison and Milwaukee leaders to work together to strengthen
the state's economy, noting that both areas have strengths that
complement each other.
that he eagerly awaits the ideas and plans from the summit so that
he can build them into his budget. "Building this economy will
require all of us to step up to the plate."
acknowledged Thompson's contribution to the state's strong economy
with a special resolution, signed by conference co-chairs Regent
President Jay L. Smith and UW System President Katharine Lyall.
Governor Scott McCallum greets the Summit
of Wisconsin Economic Summit Focuses on Concurrent Sessions, Workshop
on a State `Brand'
day of the Wisconsin Economic Summit featured a wide variety of
presentations and panel sessions that broke down the seven summit
themes into manageable segments. The discussions were lively and
the viewpoints varied as the more than 850 participants engaged
the key issues that affect Wisconsin's economy.
As the first
general session speaker on Thursday, Lieutenant Governor Scott McCallum
picked up where Governor Tommy Thompson left off on the first day.
"The best in this state is yet to come," he said. "We
have the capital assets and we have the people."
Lochhead of Scient Corporation gives a very energetic presentation
the need to recognize the role Milwaukee must play in the future
of Wisconsin. It's a big city, he noted, with an educated workforce,
and is among the nation's leaders in college students per capita.
"Our commitment ought to be to have the best education system
in the world," he said. Events such as the Economic Summit
are "helping people understand that change is going to occur"
in Wisconsin, and that we should welcome it.
Lochhead, chief marketing officer for Scient Corporation, came to
Milwaukee as a late substitute for Bob Howe, Scient's chairman and
CEO. Lochhead offered a stimulating (and often entertaining) analysis
of the end of the "New Economy" and the start of what
he termed the "Next Economy."
Brenda Blanchard - Secretary, Department of Commerce - State
is not a business model," he said, "it's a technology,
a transforming agent for creating new business models." He
went on to say that there is "No such thing as a Wisconsin
market. Every single company in the world is becoming glo-cal -
global and local at the same time." He encouraged the audience
to welcome risk-taking, saying that "If it's worth doing, it's
worth doing wrong fast."
Tom Still returned
as moderator of a panel discussion on "Wisconsin's Economic
Challenges, Potential and Opportunities." The five presenters,
including Brenda Blanchard, secretary of the Wisconsin Department
of Commerce, discussed specific strategies for enhancing Wisconsin's
future economic vitality.
economy is clearly strong and growing," said Blanchard, "with
a rate of business creation second only to West Virginia."
Unfortunately Wisconsin loses too many graduates to other states,
she said. She identified 10 areas that loom as critical factors
for the state's industrial growth, including the availability of
start-up capital and the availability of skilled labor.
Up to this
point, all summit sessions had been for the whole group. Six concurrent
sessions followed, with a break for lunch, that gave participants
an opportunity to choose between two topics. Here are examples of
the wide range of comments made during these concurrent sessions:
Wisconsin Taxpayers Alliance
on taxation in Wisconsin as a barrier to economic progress, noting
that the state income tax is substantially above the national average.
This requires employers to raise salaries in order to make up for
the income tax burden on employees. The result is lower wages for
Richard Gartner, Special Assistant to the Governor for Building
Wisconsin Department of Revenue
The issue is not less regulation, but different kinds. Government
is looked to as a safety net, moving deliberately but slowly in
such areas as cyberlaw, privacy and security, and digital signatures.
"Our tax law is based on industrial age laws," she said,
some of which are negative and some inapplicable to the new economy.
There is a need to work collaboratively with other states to simplify
the state sales tax, which accounts for one-third of Wisconsin's
Wisconsin Education Association Council
There is a shortage of teachers in Wisconsin because teaching is
not seen as a "good" job. There are also no advancement
opportunities: "You `advance' by leaving." UW-Milwaukee's
Nancy Zimpher added that it's difficult to persuade teachers to
consider positions that are urban or rural. "We need to expand
our cultural understanding," she said.
Wisconsin Technical College System
WTCS campuses serve 440,000 students each year, 75% of them over
age 24. "We try to be fast, friendly and flexible," he
said, "at low cost and in ways that are efficient and effective."
(When the room lights went out and no one could bring them back
up, he quipped: "This is a demonstration of the need for more
Chancellor Nancy Zimpher addresses workforce education
He cautioned against dismissing the "old economy" in favor
of high-tech jobs that may not materialize for a long time. He urged
the audience to focus on improving the standard of living in Wisconsin,
encouraged support for K-12 and technical college education, and
suggested the best investments were in transportation and communications
McKinsey and Company
The high-tech sector grew five times as fast as the rest of the
economy in the 1990s. "Universities act as cultural magnets
and catalysts for diversity," he said. "Innovative start-up
companies are incredibly seductive to young high-tech workers"
who "vote with their feet." The UW System has one of the
best technology transfer programs in the country.
Venture capital is much more available now in Wisconsin than it
was a few years ago, but there are many obstacles to starting a
company. "There are very few unmet needs in America,"
he said, and coming up with an idea that is better, faster and cheaper
(by at least 50%) is not easy. Entrepreneurs need energy, creativity
and passion, and most of them are "younger than the people
in the room today!"
She left Silicon Valley for Wisconsin, even though friends told
her she was crazy, because she loves the quality of life in Madison.
She talked to "everyone" when raising $3 million from
"angel" investors, noting that venture capital funds are
still very small in Wisconsin so can't commit enough money to a
single project. This search for funds leads start-up companies elsewhere
- away from Wisconsin. She noted that the UW-Madison alumni network
is extraordinarily strong and helpful to entrepreneurs.
Madison Gas and Electric
"As an economy evolves," he said, "the need for reliable
energy is increasing." Wisconsin has an aging fleet of power
plants. All new plants being planned now will use natural gas, the
price of which is very volatile. We need clean coal options and
incentives for communities to welcome the new power plants. MG&E
is committed to Green technology, such as wind power.
Assistant Chancellor for Student and Multicultural Affairs Stanley
Wisconsin Manufacturers and Commerce
He felt that Katharine Lyall's comment about Wisconsin not being
in an economic crisis was "right on the money." He added
that, "If it's action we're looking for, immediately reforming
the tax and regulatory climate is a good place to start."
speaker was Arthur Rolnick, senior vice president and director of
research for the Federal Reserve Bank of Minneapolis. He challenged
the audience to differentiate between "good" and "bad"
interstate competition for economic development. Using lavish tax
incentives to persuade a company to move from Minneapolis to St.
Paul, for example, is counterproductive for the state of Minnesota,
inequitable, and may not be good for the company or its employees
in the long run.
or states compete to have the best schools, the lowest crime rate
and the best public services, said Rolnick, there's a high rate
of return for everyone. "Make sure you've educated your kids,"
he said, before engaging in economic bidding wars.
After the last
concurrent session of the day, Marsha Lindsay led the group in a
workshop-style presentation about "The Brand Called Wisconsin:
Can We Make It Relevant and Differentiated for Competitive Advantage."
Lindsay, President & CEO of Lindsay, Stone & Briggs,
speaking about the Wisconsin "Brand"
is more than a slogan or an ad campaign," she said. Brands
have functional, emotional and social benefits, as well as economic
value. At present, Wisconsin's "brand" is too vague and
not altogether positive. She urged the creation of a panel to explore
the possibility of establishing a new, strong, bold image for the
state, one that could be used in tourism, product marketing and
community development. Implementation of such a brand will take
time and money, she said, but the benefits would outweigh the costs.
will have to brand," said Lindsay. "We don't have a choice."
She said the greatest cost would come from failing to brand. "It's
worth the investment."
session on branding was followed by a recognition reception for
the authors of the 41 Economic Summit white papers, all of which
are available on-line at www.wisconsin.edu/summit/papers
Midwest Express Center is the site of the Wiscosin Economic
Economic Summit Concludes;
UW System is Engaged with Government,
Business for State's `New Economy' Future
Wisconsin Economic Summit concluded on Friday, December 1 on an
upbeat and forward-looking note. The final morning included words
of advice and encouragement from a corporate giant with Wisconsin
roots, plus a rare joint appearance by the four leaders of the state
legislature. A wrap-up session offered an overview of the three-day
event, after which the co-chairs announced some of the next steps
planned by the University of Wisconsin System.
John Norquist extended a formal welcome on Friday. In brief remarks,
he predicted that revitalized cities -- including Milwaukee -- will
play a major role in shaping the "New Economy." He pointed
to a survey released on Thursday that cited Milwaukee/Racine as
the U.S. metropolitan area with the fifth highest "IT IQ."
He said he was impressed by the information coming out of the summit,
and pledged to do everything possible to implement recommendations,
in cooperation with the UW System, UW-Milwaukee, and the city's
featured keynote speaker was John Morgridge, chairman of Cisco
chairman of Cisco Systems, was the featured keynote speaker on Friday.
Cisco, headquartered in San Jose, is a global leader in networking
for the Internet and is among the world's largest companies, measured
by market capitalization. Morgridge, who grew up in Wauwatosa and
graduated from UW-Madison, became president and chief executive
officer of Cisco in 1988, when it was a privately held company with
34 employees and just $5 million in sales.
wave of change is changing," said Morgridge, "and the
leaders are those who can adjust quickly to the change and embrace
it." Historically, he said, someone created new value over
time. The competitive advantage diminished as the invention became
commonplace, but there was a lot of time in which to change and
maintain the advantage. Now, he said, you have to anticipate more
because of the compressed time factor. "It's not size that
dictates success," he said, "but how quickly you move."
The future of the Internet, he said, is "all about speed, talent,
brand and culture."
He cited a study
of the entrepreneurial culture in California's Silicon Valley. Six
elements stood out as important: talent, pillar companies, government,
investors, support services, and universities. Wisconsin has a great
biotechnology investment underway in Madison, said Morgridge. It's
important that this effort be followed up and built upon. For that
to happen, he said, "you start with leadership, and this kind
of meeting is that kind of leadership."
Unlike the Industrial
Revolution, said Morgridge, "this is not a revolution of mass
and capital. Speed and knowledge make the difference. Are you ready?"
Next, a legislative
perspective on economic issues was provided by the four principal
leaders of the Senate and Assembly: Sen. Chuck Chvala, Sen. Mary
Panzer, Rep. Scott Jensen and Rep. Shirley Krug.
Tom Still introduces the legislative panel (from left to right):
Sen. Chuck Chvala, Sen. Mary Panzer, Rep. Scott Jensen and Rep.
a good future in front of us in the `Next Economy,'" said Chvala,
who expressed confidence that investment "money will find good
people and innovative ideas." He proposed a new program in
Wisconsin, offering two years of free tuition to high school graduates
with a 3.0 grade point average whose families earn $60,000 or less.
He said it was wrong that the state's Corrections budget is regarded
as "sacred," while the UW System budget is considered
"negotiable." It should be the other way around, said
she was impressed with the depth and detail of the summit white
papers. She predicted progress for Wisconsin in four areas: 1) reduced
personal income tax rates, 2) an improved, user-friendly regulatory
climate, 3) more awareness of the importance of angel/venture funds,
and 4) enhanced infrastructure, e.g., roads, air travel and electrical
transmission. "Staying where we are will not get us where we
need to be," said Panzer, who challenged the UW System and
the technical colleges to work together more closely toward common
must be at the top of any legislative "to-do" list, said
Jensen. He pushed his proposal for a higher education tax credit
for companies whose employees go back to school. He again urged
Forward Wisconsin to shift its emphasis from attracting companies
to attracting and retaining skilled people. He said he wants Wisconsin
to be a more attractive place in which to retire, by eliminating
taxes on pensions and Social Security. He also called for elimination
of the state's Internet access tax (one of five such taxes in the
Krug also touched
on the "brain drain" in Wisconsin, stating that "what
we plant other states harvest" in terms of educated talent.
"How well Wisconsin embraces the New Economy will be a key
factor in our economic health," she said, "but not the
only factor." She urged continued support for the state's existing
industries, through infrastructure improvements, for example, even
while Wisconsin courts New Economy companies. Toward this end, she
said "we should not falter in our support of K-12 schools and
the UW System."
Darling and Rep. Peter Bock fielded audience comments. During questioning
the legislative leaders sparred with each other over philosophical
differences, but pledged to cooperate more closely in the future.
After two difficult budget sessions in 1997 and 1999 said Chvala,
"we're going to try to make the legislature work. We have to."
Ward, president of NorthStar Economics (left), and Don Nichols,
professor of economics at UW-Madison (right), provide a wrap-up
of the Summit
David J. Ward,
president of NorthStar Economics and a former UW System official,
and Don Nichols, a professor of economics at UW-Madison, took the
stage after the legislative leaders to draw some conclusions about
the summit. According to Nichols, the summit "clearly touched
a chord" with people who are concerned about the future of
Wisconsin's economy, people who might not have met each other if
not for the summit and its regional listening sessions. He was pleased
that the "participation of the university has been welcomed,"
and noted that the UW System is in a good position to frame many
of the issues."
on "the bottom line," i.e., the need to increase the average
income level of Wisconsin workers. He spoke of the collection of
white papers as a "preliminary road map" for the state,
and then went on to identify some areas of consensus:
the Workforce: How can we get a more seamless educational system,
and how do we get more college graduates to stay in or move to Wisconsin?
2. Venture Capital: Wisconsin ranks very low, with $14 per
capita vs. $71 nationally. There is a need for more seed capital
and angel networking.
3. Improving Technology Transfer: Research is being done
at places other than UW-Madison (e.g., Marshfield, La Crosse) that
is potentially beneficial but needs to be shared.
4. Changing the Culture: We don't "celebrate success"
in Wisconsin. We fear leaving someone behind, so we don't move ahead.
Yet, if we don't move ahead, we'll leave everyone behind.
5. Globalization: We need workers with international exposure
6. Entrepreneurial Climate: We need to make it easier to
start a new business.
7. Branding: We need to change the image of the state from
one of beer, brats and cheese to one of clear air, clean water and
a prosperous economy. It could be a decade-long project.
on infrastructure issues, noting that the shortage of electrical
power was "almost an emergency" and had dominated several
summit sessions. "Lights Out Wisconsin" is not a brand
we want, said Nichols. It would bring an end to New Economy development
and harm the old economy as well.
The final session
featured UW System President Katharine Lyall and Regent President
Jay Smith talking about the next steps for advancing the work of
gratifying to see so many from all over the state," said Lyall,
"all here together and engaged to a surprising degree in this
discussion about the future of the state's economy." One outcome
of the summit, she said, "must be to keep the conversation
going." Toward that end, she committed the UW System to "staying
engaged" with its partners in the area of economic development.
This is important because "the future of the state and the
future of our students are one and the same" and "the
future of the state's economy is the future of the university system."
A formal report
on the summit, summarizing the findings and containing action items,
will be submitted in mid-December to the governor and leaders of
the legislature, said Lyall. The summit website will remain on-line,
and a CD-ROM version of the white papers, final report and other
materials will be distributed by February 1 to participants and
the public. A year from now, the UW System will convene a follow-up
meeting to assess the progress of the recommendations coming out
of the summit.
she said, "our university campuses and statewide extension
will continue to serve as catalysts for regional discussion of economic
development, and as partners in the implementation of the many good
ideas we have heard here at the summit."
President Jay Smith brings the Summit to a close
the summit to a close by saying it had met the expectations he identified
during the opening session on Wednesday. "The summit has resulted
in the creation of a significant body of new knowledge in the seven
key areas we outlined," said Smith. "This knowledge will
lead to recommendations for further study, policy development, and
The summit also
created new synergies and partnerships involving business, labor,
education and government. "Now we need to keep those partnerships
going," he said. "We've seen the start of a serious commitment
to work together to create a set of realistic goals and a roadmap
for Wisconsin's long-term vitality and success." He urged participants
to take personal ownership of the goal of making a better future
for the state.
Smith then announced
some of the action items that the UW System will undertake:
will move ahead to form a voluntary, statewide `PK-16 Council'
in partnership with the Department of Public Instruction, the
technical college system, and the organizations that have a stake
in a seamless higher education system." This proposed council
will be discussed at the Board of Regents meeting December 7-8.
will commit to increasing the percentage of college graduates
in this state through improved graduation rates for our campuses."
the use of our alumni networks, we're going to bring our graduates
back home to Wisconsin. We're going to get very active in that
will commit the UW System to developing a strategy [by February
1] for bringing more federal dollars home to our campuses,"
in cooperation with the UW System institutions and the Wisconsin
- The UW System
will bolster technology transfer in a variety of ways: expansion
of Small Business Development Centers, enhanced visibility for
the new WiSYS patent and licensing structure, and support for
a joint UW-Madison/UW-Milwaukee business incubator.
- Other action
items, related to such issues as venture capital, energy, infrastructure,
taxation, branding, and regulation, will also be addressed in
the report to the governor.
take all of us working together to address these issues," said
Smith in closing. "With the energy, wisdom and concern that
I've seen here at this summit over the last few days, I'm confident
that we can get this done. And we will."