MISSOURI RENEWS PUSH FOR PAYROLLS

~For at least the past quarter of a century, every candidate for governor and most candidates seeking a seat in the state legislature have pledged to work for industrial development and the creation of thousands of new jobs. Like the weather, everybody talks about such programs but nobody seems to do anything about them.

Industrial development may be the most soporific issue on the political agenda for Missouri. It stirs neither strong objection nor vigorous action. It merely puts people to sleep.

In recent weeks, the prospects for implementing some kind of effective and workable program in Missouri have brightened, if only because the state has the right kind of individual heading the Department of Economic Development: former state representative Joe Driskill, whose legislative career was focused largely on initiatives that would provide new employment around the state.

Driskill not only has a broad political background, he is a development wonk, someone who devotes a great deal of time and study to the methods employed to create jobs and develop communities. Most of the job-creation legislation enacted in the state in recent years bears the Driskill imprint, and he was so involved in pushing enabling job legislation in this year's session that he remained in the House until it was well on its way to passage before assuming his new DED duties. The state has never had a surplus of men and women like Driskill, and there have been times we seemingly have had none.

These days there is more talk than usual, both in Washington and Jefferson City, about plans for a new twist to the concept of enterprise zones. What proponents suggest is targeting a depressed area for saturation of multiple developmental services, with the objective being job creation.

The idea of area development is not new. The best known example to date is the Tennessee Valley Authority (TVA). Even Franklin Roosevelt's harshest critics acknowledged that TVA worked out well, although numerous politicians in recent years have suggested that the whole kit and caboodle be handed over to private enterprise. On the other hand, various Appalachian development programs have been less effective. If a lesson has been learned it is dual: an area or region must be "ripe" for take-off (or in other words, it must have a genuine potential) and the program needs to be comprehensive. Halfhearted and halfway efforts are a waste of time and money. A good example is the highly touted but unfruitful effort to devise development programs for the Upper Mississippi Valley region, an area that includes our own state. That program has only identified the problems, as if anyone needed to be told, and has vaguely outlined steps that have long since been considered unattainable without a great deal of money from a bankrupt central government.

Today's enterprise zones are on a much smaller scale than the earlier regional projects. To date most have been confined to urban areas, including their fringes, although the results have ranged from spotty to non-existent. President Bush drew on the zone idea for reconstructing the riot-torn south central Los Angeles, and the verdict on that effort is already in. Unfortunately, it hasn't worked. President Clinton still must define his economic plan but has thus far borrowed the enterprise zone idea from states and cities and has proposed a federal alternative. Details have not yet been sketched out, but income tax incentives would be heavily relied on.

No overall judgment, pro or con, comes readily to mind on so nebulous an idea as enterprise zones. The old adage holds that the proof lies in the product, in other words the results. Nevertheless, a few pluses and minuses can be identified. The big plus is that any success in establishing viable new businesses is all to the good.

But three negatives are not minor: (1) fiscal considerations might keep a project too small to be effective; (2) it is difficult to make certain that the benefits will go to new local businesses and not to relocated ones; and (3) income tax concessions can work more to the benefit of businesses that are already successful than to struggling new companies - a contradiction to what is intended.

It is impossible even to speculate how large a national enterprise zone might be, and it is almost equally impossible to speculate on what a statewide one would mean for Missouri. According to economist Richard Reeder, the federal proposal of last year called for establishing 50 zones, half of which were rural. If a similar proposal is enacted under Clinton, it could require the U.S. Department of Agriculture to select the rural zones and implement the program.

For the moment, the best description of an enterprise zone is an area of high unemployment and economic decline, designated to receive business tax incentives and other government assistance to stimulate the economy. A strong community proposal for Missouri must include an economic development plan tailored to meet local needs and regional potential and one that is supported by local businesses and residents. Any plan in Missouri should also include local property tax incentives, streamlined permit processes, improvements in infrastructure, a community-wide anti-crime effort and other activities for enhancing the local business climate. A caution must always be noted against expecting the local region to make a large financial contribution. If it were able to do that, it would not qualify as a zone.

We believe Missourians should look favorably on applying an enterprise zone approach to a relatively few well chosen areas, and yet remind themselves that the greatest problems are not narrowly localized. Inadequate infrastructure, substandard schools and limited financial resources are examples of factors that, although not universal across the state, pervade much of Missouri, both inner-city and outstate . Enterprise zone projects can, in the long run, contribute to local and state development but are not a replacement for it.

Missourians have been promised workable, successful economic development programs. Our only available response at the moment is patience.