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February 17, 2013

Charles Lawton: Economic checkup needs a prescription for action

The first stage of the digital revolution has produced information overload. Google set out to scan the world's knowledge and make it available to everyone. Apple set out to move the world's music from vinyl disks and magnetic tapes to electrons in the cloud. Facebook is hoping to put all personal information on its pages. We are awash in information. And Julian Assange and WikiLeaks seek to make all information from all sources available to all people all the time -- privacy and secrecy, if not quite yet obsolete, are getting closer every day.

The second stage of the digital revolution is the search for meaning -- big data, search algorithms, artificial intelligence, robots, Siri. The knowledge industry today is like the mining industry -- an intricate effort to refine enormous volumes of data into a much smaller quantity of useful information. And, simultaneously, to develop customers who will find that information valuable.

In this light, it is interesting to consider the Portland Community and Portland Regional Chambers' "Economic Scorecard for 2012-13." The report compiles the most recent figures available for 32 indicators -- everything from jobs, income and population to crime, education, patents and overnight visitors. For each indicator, it compares Portland (or the Greater Portland region) to some goal, some regional, state or national benchmark. Finally, comparing fact to goal, data to target, it lists a rating. For each indicator, the city (or region) is exceeding, meeting or lagging its goal.

As with a health checkup, such a report is valuable only if we can derive some meaning from its findings and, more importantly, use that meaning to direct our action. With a health checkup, however, the target audience and the responsible party are one and the same. Having had my checkup, thought about my results, met with my doctor, only I can decide to lose weight, quit smoking, get more exercise, monitor my cholesterol and blood sugar levels.

The same cannot be said for the Economic Scorecard. Both interpretation of the results and determination of an appropriate course of action are far less clear. Even if we could find an economic health care specialist to interpret the results and prescribe a useful course of action, she could hardly assemble all the relevant responsible parties in a room, sit sagely, stethoscope around her neck, and quietly tell us what we should do.

Appendix C of the Scorecard report takes a step in this direction. It relates the various data items measured to the "Portland Economic Vision and Plan." But the actions listed in the plan, however laudable, are vague and contain no reference to a responsible party. One action step, for example, reads: "Understand the needs and concerns of existing businesses to support their retention and expansion." What exactly does that mean? Who is to understand? Who is going to do what to "support" retention and expansion?

Another example is: "Sustain economically vibrant neighborhoods." Which neighborhoods? Only those that are now "economically vibrant?" How sustain? By doing what? And who is to do what?

The list goes on: "Support a working waterfront;" "Create incentives to establish and grow Portland's creative enterprises;" "Attract and support entrepreneurs." Clearly, these are all goals to support. But they will be achieved only by refining the steps to be undertaken -- the specific actions -- and only by clearly specifying the people responsible for undertaking them.

Too much hard work has gone into the Portland Economic Scorecard, too much valuable information gathered, too much meaning yet to be refined from its data to allow it to become just another report to sit on a shelf. I applaud the effort, but call for next steps, some of which I intend to present in this space over the coming weeks.

Charles Lawton is chief economist for Planning Decisions, Inc. He can be reached at:

clawton@planningdecisions.com





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