In the last few weeks, I have seen two Maine leaders who ought to know better opine that the solution to our economic woes is to revert to our natural resource base and focus on agriculture, fishing, forestry and tourism! I was shocked. This is the same as saying that we ought to be in the buggy whip business as long as possible!
Here are the facts. Innovation drives as much as 80 percent of economic growth. The other 20 percent comes from labor and capital. With our shrinking labor force, that is not going to be a driver, unless we suddenly attract a slew of young, talented and educated immigrants. Capital isn’t our strong suit either, so that leaves innovation.
With a few exceptions, I don’t see a lot of innovation happening in our agriculture, fishing, forestry or tourism businesses. I see a lot of hand-wringing as years of benign neglect make each of these industries less and less competitive in the global markets. We’re losing jobs in most, if not all of these sectors. There are not a lot of new ideas, but rather a focus on cost-cutting, and retrenchment. This is what happens when a sector is dying, not growing.
There are great opportunities, however, to use our natural resources in new and exciting ways. One sector that is growing is clean technology. This encompasses renewable energy, wind, tidal, biomass, to name a few examples, advanced materials, environmental services and energy efficiency. This sector grew 30 percent from 2003-2010, while the entire Maine economy grew only 1 percent. And all of these depend upon our oceans, our forests and our agricultural heritage.
The good news is that this growth has been encouraged by public policy. We have expanded our policy support for all types of renewable energy, supported investments in research and development that have enabled major, international leadership positions in tidal and offshore wind power and bio-based materials, and ramped up our entrepreneurial support programs. Just two weeks ago, at a Massachusetts-based clean technology entrepreneurship competition, the only two prizes were awarded to Maine companies.
The challenge is to make sure the leaders who are out there shaping public opinion actually know about the positive things that are happening in our economy, and don’t revert to the politically safe, but economically disastrous support for the “good old days.”