Likening a community's economy to water flowing in a river, the head of the Kenai Peninsula Economic Development District recently told area business leaders that economic development is like a lake in which that economy can circulate and thrive.
"Like the river, money flows into a community at one end and empties out at the other," said John Parker, EDD executive director.
"Having the lake allows the money to circulate around," he said.
Money entering a community comes in the form of investments or transfers from government and money going out is money spent outside the community and taxes paid out.
Economic development has two basic models, according to Parker.
"You can take a bag of money and lure industry back to your community or you can lure them with incentives such as tax breaks, land and cheap labor," he said.
He warned, however, that any company that can be lured into a community can be lured away.
One way communities can keep money from flowing out is to keep pension funds in.
"Ask where the pension money is being invested," he said.
"If you're sending your investment money out of Alaska, you're also sending your jobs out. Unemployment can be solved locally," he said.
"You can't send your investments outside and then complain that there are no jobs here."
After a nationwide search, Parker was hired to head the EDD late last year. A native of Nova Scotia, Canada, Parker was selected from a group that originally included nearly 40 applicants from Alaska, Canada and the Lower 48.
Parker's past experience in economic development primarily includes work in rural, northern communities.
He said people can help their local economies by shopping within their own communities.
In addition to the consumer's dollar remaining in the community, jobs are created where people shop and invest their money.
Big companies such as Home Depot or Wal-Mart chase markets, Parker told the group.
"No one here has the power to bring them in or to keep them out," he said.
Parker recalled an instance in which a woman approached a business owner asking him to hire her son.
"'Why?' the man asked. 'You shop over there. Get him a job over there,'" Parker said.
"People say we need a good clothing store here, but they go to Anchorage to shop for clothes," he said.
"If you're spending your money in Anchorage, the clothing stores will stay there."
He said it is important for the entire community to act as a community in matters affecting their local economy.
"If a community acts as a community, and not as individuals, it has the resources to solve any problems at hand," he said.
When asked by one business person if the state of Alaska should invest more than 3 percent of its $27 billion permanent fund within Alaska, Parker said the underlying problem is that people in the Lower 48 see that Alaskans are not investing in Alaska.
"Then why should they?" he asked.
Parker said his mission is to clear the weeds away from economic development.
The mission of EDD is to foster economic growth and development by implementing borough-wide programs to create employment opportunities for borough residents and complement community and individual development initiatives.
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