Youngstown Advantage Redux

Janko focused my attention on an article in today's Business Journal. Here's the passage that resonated with him:

“I think if we can continue to develop Lordstown’s reputation as the center of gravity for the auto industry,” Ryan said, “the Cruze can be just the beginning.“ Developing a cluster of auto and auto-related companies in the Mahoning Valley, especially those related to alternative and green energy, is possible.

“We have a great opportunity with the green revolution because we offer everything that they would need. If they need business software development, we’ve got the Youngstown business incubator,” he elaborated. “If they need energy product development, we’ve got the Warren incubator. If they need research, we’ve got Youngstown State University. If they need job training we’ve got the community college -- we’ve got everything infrastructure-wise in place. Now it’s about going out and pitching the deal.”

Financial incentives are still important in luring business to the Valley, but they aren’t as important as they once were, Ryan said.

Today, knowing that there are opportunities to partner with YSU, the business incubator and other entities that can help businesses succeed long term are more important than incentives, he observed. Those possibilities along with the Valley’s skilled workforce, low cost of living and vision “are all in our favor,” Ryan said. “Youngstown State having the first STEM college in the state of Ohio sends a signal that we know where the future is.” He added, “I believe our area is leading the country out of the recession.”

In bold is the part of Congressman Tim Ryan's comments that jumped out at me. I'm not a big fan of financial incentives. I'm in good company:

While states battle to outdo each other with bigger incentives, there are smarter ways to attract or bolster companies, the nonprofit research center Good Jobs First of Washington, D.C., suggests in its [report] released today.

For instance: Concentrate efforts around occupations that already are strong in a specific region, rather than creating packages for specific companies. Nuclear, civil and other types of engineering along with biomedical fields are strong in Pittsburgh, so training and job growth efforts could be focused there, Good Jobs First said. ...

... The research center contends Pennsylvania's tax structure isn't significantly different from those in most other nearby states — in fact, it's in the middle of the pack — so the state should "do no more harm to the tax code."

Instead, Pennsylvania should hone its attention on workforce development and other issues such as growing its own employers rather than recruiting from outside, and pushing for better federal trade policies.

Especially in manufacturing, "The number of jobs lost offshore is dozens of times greater than the number lost to other states," Good Jobs First said.

For more, see the Wall Street Journal.

I'm not crazy about the proposed federal trade policy angle, either. But I appreciate the stated course for localities and states to follow instead of lavishing companies with all kinds of money. Even if the incentives do work, the gains are ephemeral. There is always another place that can afford to offer a better deal. Frankly, it is extortion and a lot like the leveraging of brain drain hysteria to get voters (or politicians) to support some boondoggle.

I look around the Rust Belt and I see many regions with the same assets. What sets apart one shrinking city from the rest? Not to scratch the scab off of a recent wound, Sean Safford's research comparing and contrasting Youngstown with Allentown offers possible comparative advantage. I believe that the Mahoning Valley civic infrastructure could be the envy former manufacturing centers across the country. However, Pittsburgh probably holds that distinction thanks to some remarkable partnerships and economic vision that started, in some cases, 50-years ago.

The current civic infrastructure bodes well for the future. It's a big change from the Youngstown Safford saw. The legacy of the James Traficant era won't disappear overnight and the ravaged economic landscape will continue to dominate the headlines. Pittsburgh is just beginning to shake the rust off of its national image, a process that has taken decades and at least two major urban reinventions that served as a model for many US cities such as Minneapolis. This hard-won transformation isn't easy to replicate, unlike generous tax incentives or even substantial tax reform.

The task before us now is to get the good word out and help the ambitious to understand the unique value proposition. This result still eludes Pittsburgh, as the Power of 32 fiasco indicates. Let's hope that the TechBelt Initiative is better up to the task. This should be an open and inclusive process, not business as usual.

Greater Youngstown Green Manufacturing

What will the new economy look like? Congressman Tim Ryan and US Senator Sherrod Brown proposed a vision that makes the TechBelt an American center for green innovation. An article in today's Akron Beacon Journal about the wind power industry provides a glimpse of the emerging geography:

Green Energy Technologies LLC is not producing utility-size wind turbines but smaller units aimed at commercial and industrial customers.

The privately held firm based in Bath Township is selling what it calls the WindCube, a wind turbine that will produce power on site, not just electricity to be added to a grid like the large twirling turbines. ...

... The WindCube — with its 61 components — will be built by Roth Bros. Inc., a Youngstown energy-management company that has invested $2 million in what Cironi is doing. Parker-Hannifin Corp. in Cleveland will produce the generator and electrical system.

From Cleveland to Morgantown (West Virginia), your alternative energy idea can be manufactured in the Mahoning Valley. That's not to say innovation can't happen in Youngstown, but that industrial know-how is already clustered in the area. This is an example of how regional approaches to economic development can benefit all member communities.

The kind of talent needed to produce these goods is already in short supply. Research and development is geographically mobile, but ample supplies of manufacturing expertise (along with the necessary infrastructure) are not. I think this is a harbinger of more geographically concentrated global supply chains providing the TechBelt with a comparative advantage. Also, it doesn't hurt that Ryan and Brown are funneling substantial public investment in clean technology back home.

Thoughts on ITC Ruling Press Conference in Warren

I was tempted to address the criticism of the Mahoning Valley trade mission to Israel, but the objections are ridiculous. Those community leaders got the 15-minutes they were seeking. I found the following comment about the benefits of the import duties illuminating:

The congressman emphasized that the U.S. is on the verge of a “green revolution” in which companies such as Wheatland Tube and V&M Star would be called on to produce the components needed to power America’s future through alternative energy sources such as wind turbines.

“There is a revolution coming in green technology,” Ryan said. “If we let the Chinese continue to dump their products on our country, then we’ll see another revolution in America that we’ll miss.”

Today's news cycle is still spitting out stories about the Green Revolution (great one here). Reads like a media blitz trumpeting Obama's preferred economic strategy, a manufacturing manifesto. Whether or not it is a good idea, the money is coming.

That pipeline is pointed right at Greater Youngstown. Again, I'll stress the connectivity opportunities. Israel is certainly one of them, but so is Pittsburgh (via the TechBelt Initiative) and the Front Range of Colorado. The regional diaspora in the Greater Denver area could prove to be very useful, particularly concerning alternative energy projects back home.

Blog Release: ITC Ruling Press Conference in Warren

Congressman Tim Ryan joins Senator Sherrod Brown and ODOD Director Lisa Patt-McDaniel at Local Steel Manufacturer to Discuss Recent ITC Ruling on Chinese Steel Imports

(Warren, OH) This afternoon, Congressman Tim Ryan, Senator Sherrod Brown, and Ohio Department of Development Director Lisa Patt-McDaniel will discuss the impact of the International Trade Commission’s recent ruling regarding Oil Country Tubular Goods imported from China. William Kerins, President of Wheatland Tube Co., and Roger Lindgren, President and COO of V&M Star Steel, will join the legislators to address the potential positive effects of this ruling on their local operations.

Regarding the decision, Congressman Ryan stated that, “For years, our manufacturers have been fighting a flood of inferior Chinese products in the American market. The recent ITC decision regarding the placement of tariffs on steel pipe and its previous decision regarding rubber tires move us in the right direction toward leveling the playing field for local businesses including V&M Star and Wheatland Tube. Senator Brown and I will continue to work with the ITC and the Obama Administration to seek tariffs for other Chinese products that threaten to undermine the economic health of this nation.”

Senator Brown added that, “Trade enforcement means jobs. For too long, domestic manufacturers like Wheatland Tube and V&M Star faced an inexcusable flood of Chinese products made with unfair subsidies. By enforcing trade law, we will ensure a fair playing field and save jobs.”

WHO: Congressman Tim Ryan (OH-17), Senator Sherrod Brown (D-OH), and Ohio Department of Development Director Lisa Patt-McDaniel

WHAT: Press conference regarding recent International Trade Commission ruling re: tariffs on Oil Country Tubular Goods imported from China

WHEN: THURSDAY, JANUARY 7, 2010 at 1:30 PM

WHERE: Wheatland Tube Co.

901 Dietz Road NE

Warren, Ohio 44483

# # #

Clean Tech Market Watch

I look at economic development through the lens of migration and workforce development. Does the Mahoning Valley have the talent it needs to be a leader in the Green Revolution? If not, where will this skilled labor come from? Retraining via federal government grants would appear to be the preferred answer to the above questions:

“The most exciting part of what’s happening here is that these programs are aligning with what Ohio communities and universities are doing to tap into the green economy and the green revolution,” said U.S. Rep. Tim Ryan, D-17 Ohio, who with U.S. Sen. Sherrod Brown, D-Ohio, joined Solis on a conference call to announce the grants. “Our manufacturing base isn’t just our past now, it’s our future.”

Ohio, Brown said, already has a skilled work force and “a rich manufacturing heritage. These funds are targeted for communities that have been hit hardest by job loss in the auto industry,” he continued. “They will lead to good-paying jobs and will help Ohio become the Silicon Valley of clean energy manufacturing.”

Greater Youngstown is betting a lot of resources on clean tech manufacturing and innovation. That's why I follow this storyline so closely. If you want to move back, then you best keep that in mind. Follow the money trail.

But is the region making a smart bet? A recent report highlighting the relatively robust venture capital investment in clean tech suggests that it is:

In a flurry of deal making bolstered by government subsidies for renewable energy, venture capitalists invested $5.6 billion in green technology companies worldwide in 2009, according to a preliminary report released Wednesday by the Cleantech Group and Deloitte. ...

... “In 2009, clean-tech went from a niche category to become the dominant category in venture capital investing,” said Dallas Kachan, managing director of the Cleantech Group, a San Francisco market research and consulting firm. “Clean-tech continued to outpace software and biotech.”

I emphasized the caveat in what looks to be good news for the clean tech sector. There's a debate about whether or not public investment in green jobs is sustainable. A good example is the natural gas market. Currently, there is a global supply glut. As a result, gas is a very cheap source of energy. Can clean tech compete?

The Mahoning Valley already has a substantial stake in the development of cheap natural gas, as represented by the proposed $1 billion expansion of V&M Star in Youngstown. That, too, is a big bet. You might see that as a good thing. The region is diversifying its economic portfolio within the energy sector. Looking at Pittsburgh, that strikes me as a good idea.

Mahoning Valley Goes to Israel

The Regional Chamber is leading another international trip, this time to Israel. A large contingency representing a variety of interests will be making the journey. Just because I've read a lot about clean tech innovation in Israel, I'm interested in that angle:

The trip will include site visits and one-on-one meetings with Israel’s vast array of business incubators, including visits by Mayor O’Brien and members of the Warren Cleantech incubator steering committee -- Scott, Osterloh, Smith and Garvey -- to Cleantech incubators in Israel.

Israel is an entrepreneurship dynamo. Warren stands to gain a lot by going and learning from a global leader in clean tech R&D. I think this bodes well for the future of the incubator in that neck of the Mahoning Valley.

I recommend a close inspection of the economic geography of the Israeli incubators. There are likely a few aspects that can't be replicated, but the general clustering and proximity should be telling. Also, how do the incubators serve as economic drivers for the host communities? Warren has the opportunity to do something unique in the TechBelt and Israel is an excellent guide.

Energy Industries of Ohio

As publicized at Brewed Fresh Daily, Energy Industries of Ohio will (once again) speak at the Youngstown Business Incubator. The 411:

Energy Industries of Ohio

“Supplier Opportunities for Clean Coal, Advanced Energy, Nuclear & Defense”

Thursday, January 28, 2010

3:00 pm

Youngstown Business Incubator

241 W. Federal Street, Youngstown

Nancy Horton, Project Manager for Energy Industries Ohio (EIO), will speak on the development of Ohio’s advanced materials supplier base for clean coal, nuclear power, advanced energy and defense applications.

RSVP to jmsmith@ybi.org

Looks to me like a must-attend if you are interested in Mahoning Valley and/or TechBelt economic development.

Expatriate El Paso

Over at Burgh Diaspora, I look at the problem of the growing risk-averse population in the Rust Belt and consider two solutions. An emerging trend, shrinking city expatriates are returning home to rebuild. By way of adding another tale to the pattern, boomerang El Paso:

But a new trend is taking place at the start of the second decade of the 21st century. Many young professionals are deciding to make a difference in their community, and with it, enhancing the long-term growth and prosperity of El Paso.

"You see it in the young people moving back here for the kind of jobs El Paso has never had before or who come back to start businesses or families or projects," city Rep. Beto O'Rourke said. "You see it in someone like Jim Ward of Sleepercar, who because of his talent and standing in his industry, could live and work in any city in the world and yet chooses to make El Paso his home."

Mayor John Cook sometimes looks at the city representatives and thinks to himself, "I have a grandchild almost your age."

Cook, whose granddaughter is 27, realizes how important tomorrow's young leaders are to El Paso.

"New ideas are extremely important, especially those from young people who have gone off to college, lived in other communities, lived in other exciting cities and then come back wanting to make their city a better place, wanting to make a difference in their community," he said. "You will see more innovative young people coming back and saying, 'I didn't just get smart in college, I got ideas and I'm going to come back home and make my city a better place and make a difference."

Plugging the brain drain, keeping talent from leaving, is bad policy. Even if effective, the region will lack a fresh perspective needed to reinvent the economy. Deeply rooted natives aren't going to be agents of change.

Ohio workforce development initiatives make this mistake. Too much attention is given to local graduates moving out of state. Take the money that has been earmarked to slow the exodus of talent and apply it to luring the best and brightest back to Northeast Ohio. Why doesn't Joe Schiavoni fund what Tyler Clark is doing, instead of incentivizing graduates to stay? Why not facilitate another Eric Planey returning to the Mahoning Valley? I can tell you that all the brain drain initiatives being tried now have been tried before, and failed. Time to explore some different options.

ITC Steel Pipe Ruling

Breaking good news for Greater Youngstown:

The Commerce Department is likely to issue an order Jan. 14 for U.S. Customs offices to collect duties that would counteract the subsidies, [International Trade Commission spokesman John Greer] said.

Seven U.S. producers of steel piping that is used in oil and natural gas wells, along with the Downtown-based United Steelworkers union, filed a trade complaint in April, claiming the subsidized Chinese products have hurt the industry and resulted in the loss of about 2,400 steelworker jobs.

The Business Journal has some additional information you can find here. Again, I'll point out that this steel product is important to the booming natural gas industry centered in Pennsylvania and New York. The close proximity to the Marcellus Shale Play is likely a key factor in V&M Star's decision about where to expand operations. I would speculate that the imposed duty makes the investment more likely, but doesn't necessarily privilege the Youngstown location.

Youngstown in Buffalo

As a blogger, I often stumble upon curious and unexpected facts. Youngstown is a part of the Buffalo (New York) region. I'm not referring to the great steel city on the Mahoning River. I gather Youngstown is a suburb of Buffalo. When I'm searching for stories about the Youngstown in Ohio, every so often the place in New York pops up.

Yesterday's blog post afforded a similar serendipity. Youngstown Pride chimes in with an anecdote about immigrants improving a Buffalo neighborhood. Then, Defend Youngstown offers up PUSH Buffalo as a relevant neighborhood redevelopment model.

The very act of creating the blog post you are reading now yields the following find:

As a snow plow trudged its way over Delaware Park — designed from 1868 to 1874 by Frederick Law Olmsted and Calvert Vaux, the vision behind Central Park — Mr. Akauola, 53, warmed up in his black Ford Escape. He had walked only two laps — about 3.6 miles — in the park. “Normally, I go three to four rounds, but today it’s hard on your feet,” he explained. “You don’t want to mess up your ankles.”

A native of Tonga, Mr. Akauola, who works in construction, estimated that he is one of a very tiny number of people from the South Pacific living in western New York. (The two climates, of course, could not be more different.)

Mr. Akauola lived in Hawaii, where his two sons and daughter were born, from 1980 to 1985. His wife’s sister, who lived in the Buffalo area, suggested that the family settle here.

“When our first son was born, she gave us the idea,” Mr. Akauola recalled. “Buffalo was an affordable place to put your kids in school.” The three children are grown now. The younger son, who graduated from Rutgers University, lives in New Jersey; the daughter, an alumna of Arizona State University, works for an oil company in Houston.

This unexpected migration to Buffalo could just as easily occur in Youngstown. Missing are the folks who might encourage it. Why not Youngstown?

Youngstown Immigrant Innovation

Update: Youngstown Pride points to a New York Times article about immigrants revitalizing a struggling Buffalo neighborhood.

Richard Herman passed along to me a link to an op-ed in the Cleveland Plain Dealer about the weak investment in the Fund for Our Economic Future. The Cleveland Foundation's hasty retreat is a mystery. Is the Fund not Cleveland-centric enough? One critique of the Fund, found in the op-ed, is a lack of leadership on the immigration front.

The Youngstown/Warren Regional Chamber should keep that in mind as it campaigns for a renewal of the Ohio Third Frontier program. Anything good can always be better:

Regional groups have told [Richard Herman] ''internationalization was not a top priority,'' he said. ''Immigration is kind of a dirty word here, and organizations don't want to use it.''

For instance, until a year ago, an Ohio Third Frontier-funded program for interns specifically excluded those who weren't citizens from participating.

''That was a bright sign saying, if you're an immigrant, don't come to Ohio,'' Herman said.

One regional mover and shaker who seems to get it is Rob Briggs, president of the Akron-based GAR Foundation, Herman said. He credited Briggs with some of the ideas in the book.

Briggs once convened ''the top believers in the region and asked them to produce an international talent blueprint,'' Herman said. Aspects of that effort are beginning to emerge around the region.

He pointed to the EB-5 Regional Center in Akron and Wooster (which speeds up the visa process for foreign investors of American businesses), an international welcome center being discussed between Cleveland State University and the Jewish Community Federation, and increased activity around international student recruitment and business recruitment (such as Akron Mayor Don Plusquellic's missions to lure foreign companies into launching American operations).

If the Mahoning Valley doesn't have an international talent blueprint, it better craft one ASAP. The Regional Chamber took a strong step in that direction when it hired Eric Planey. The trade trip to China is an impressive undertaking. What about an analogous workforce development strategy?

The "America First" mentality that James Traficant represents is alive and well in Greater Youngstown. Congressman Jason Altmire, TechBelt co-conspirator, has pandered to the anti-immigrant sentiment of his constituency on more than a few occasions.

Being tough on illegal border crossings and putting America's prosperity first don't preclude immigration as an economic development strategy. Too often, we throw that baby out with the bathwater. The debate is polarized as closed borders versus open borders. Or, you are either anti-globalization or anti-American jobs. These are difficult waters for politicians to navigate, but the issue is mission critical for a struggling region.

Spotlight on Warren

All the natives won't move back to the Mahoning Valley, but there is more value in the expatriate community than just numbers. Those who leave have an easier time seeing a bigger region. Where you went to high school is still important, but not to someone born and raised in California. From far away, the fate of Youngstown and Warren are obviously intertwined.

The rapidly evolving story of the Warren advance-energy incubator should interest everyone in the entire TechBelt. Enter Rebecca Bagley, the CEO of NorTech (Cleveland):

Bagley, U.S. Rep. Tim Ryan, D-17 Ohio, state Sen. Capri Cafaro, D-32 Hubbard, state Rep. Tom Letson, D-64 Warren, and Mayor Michael O’Brien, outlined their vision Monday of what such an incubator might achieve in the fields of “advanced energy and flexible materials.”

Long on optimism and short on specifics, the four expressed hope the incubator will rejuvenate manufacturing in Mahoning Valley through infant enterprises that one day produce parts for windmills, geothermal, solar and nuclear energy plants and sources of energy other than petroleum, coal and natural gas.

You can find out more about Bagley's vision for Northeast Ohio here. You can also read more about NorTech's plans here. The effort dovetails nicely with the big energy sector push going on right now in Pittsburgh.

Warren could play a key role in the growth of this industry. That's good news for Youngstown and the entire Mahoning Valley. The bad news is the border between Ohio and Pennsylvania. NorTech covers Northeast Ohio, not the entire TechBelt. How Cleveland and Pittsburgh can work together is still a mystery.

Global Green Youngstown

The greening of the Rust Belt is a big part of the vision for this megaregion's future. The primary reorientation is turning to face all the lakes, rivers and streams that used to serve as a dump for all the industrial waste. Green manufacturing is supposed to help along this transition:

Thursday in Copenhagen, U.S. Rep. Timothy J. Ryan announced what he's calling a ''transformational partnership'' between Youngstown and a national environmental group to foster green job creation and development in the rust belt city.

California-based Global Green USA will help speed along planning efforts in the city by building on the Youngstown 2010 plan and putting into place citywide and neighborhood specific greening plans.

The move, Ryan said, could position Youngstown to be a model green city for other Midwestern communities by, simultaneously, reducing its carbon footprint and by doing so, becoming an economic engine in the growing green industry.

''We are leading the green revolution,'' Ryan, D-Niles, said. ''This innovative collaboration will help to elevate Youngstown, northeastern Ohio and the Cleveland-Youngstown-Pittsburgh tech belt - opening us up for global investment in cutting edge green energy technology and sustainable development in our district.''

Not to diminish the gratuitous TechBelt reference, the Global Green USA partnership imagines a green city that serves as a redevelopment model. Youngstown is to be a test tube for sustainable urban design. Helping to fund this initiative is a member of the Youngstown Diaspora:

Jack Scott, a former Youngstown resident who runs a technology company in the Salt Lake City area, and the Raymond John Wean Foundation each contributed $25,000 to this program.

Scott's name rang a bell. He was involved in the Sustainable Energy Forum held last summer at Youngstown State University:

Abraham credited YSU alumnus Jack Scott with being the driving force behind the conference.

Scott earned a degree in mechanical engineering and worked his way up to become president and chief operating officer of Parsons Corp., a California-based engineering and construction company that has $3.4 billion in annual revenues.

Scott said he has a passion for sustainable energy, but he wanted to hold the conference in Youngstown because of his love for the Mahoning Valley and its people.

“One of the greatest assets of this area is the work ethic,” he said. “We hire people from all over the world. You can always tell people who were hired from this area.”

Scott said the forum has to produce action to be a success. The goal is to link researchers with innovative ideas to people who can bring those ideas to market, he said.

Discussions are to be held today on how to continue the collaborations, he said. Also, he and other organizers will meet Wednesday to review the effort and talk about the future.

The issue of sustainable energy is critical for the nation, Scott said. The nation needs to rebuild its manufacturing base to remain an economic power, and a new opportunity is to produce parts for wind turbines, solar panels and other new forms of energy, he said.

The nation should not rely on other countries for these forms of power as it has done with oil, he said. The U.S. sends nearly $1 trillion a year to Saudi Arabia and other oil-exporting countries.

“It’s the single biggest transfer of wealth in the history of the world,” he said.

Scott is an archetype for the region's diaspora economy. One needn't reside in the area to benefit the Mahoning Valley. Scott's success and expansive network are assets for his hometown.

Blog Release: Round Two of EfficientGovNow to Offer $330,000 in Grant Awards to Government Collaboration Projects in Northeast Ohio

The Fund for Our Economic Future, a collaboration of philanthropic entities working to strengthen the region's economic competitiveness, introduced EfficientGovNow earlier this year to encourage greater government collaborations and engage the public to advocate for change.

EfficientGovNow is a competitive grant awards program that encourages and accelerates government collaboration and efficiency by providing rounds of funding to government collaboration projects as selected by YOU, the residents of Northeast Ohio.

The first round of the program, held in early to mid 2009, attracted more than 255 local governmental entities to submit ideas for collaborative projects. Collectively, the projects estimated one-time savings of nearly $40 million and anticipated annual savings of more than $22 million – dollars that can be used to grow and/or attract businesses, provide more education and training, or spent in other ways that grow the economy.

Equally exciting, you, along with nearly 13,500 other Northeast Ohioans, voted in support of the ideas. You participated in a way that motivated government officials to continue to seek ways to collaborate and become more efficient.

That is why, earlier this month, the Fund announced a second round of EfficientGovNow – this time offering $330,000 in grant awards.

RIGHT NOW is your chance to help get this round started. Check out 10 easy ways Northeast Ohioans can spur the second round of EfficientGovNow. Getting engaged is as easy as e-mailing a government official, following EfficientGovNow on Twitter or Facebook, or forwarding EfficientGovNow news coverage to a friend.

Your voice is essential to this effort. Help spur greater government collaboration -- help advance the economic revitalization of Northeast Ohio.

Ragnarök Youngstown

Once again, Mahoning Valley misery is national news. You've seen the images a thousand times. If not in Youngstown or Warren, then in Detroit. The new round of photos don't look so fresh. They haven't for 30 years:

In this corner of northeast Ohio, from Warren to Youngstown, where the old steel mills along the Mahoning River stand like rusted-out mastodons in the weeds, the recession was a final cruelty piled on top of three decades of disappearing jobs. ...

... The road from Warren and Youngstown is a graveyard of silent machines behind chain-link fences. Near the Pennsylvania border, this 25-mile stretch along the Mahoning River was the world's fifth-largest producer of steel until the late 1970s, when more than 50,000 jobs vanished in a decade. The General Motors plant in Lordstown, which employed 14,000 in the 1970s, is down to about 2,500 workers.

Every time globalization goes into one of its funks, some journalist is grasping for the final nail in this region's coffin. The angle is the same, as are the images. It is cliché, the latest downturn providing another excuse to dredge the Mahoning River for the body of Industrial America.

The real story, if you can pry your eyes away from the urban blight, are the changes. The "final erasure" is the burial of the glory days, a blank slate. However, a writer can't look at the current pain without relating what happened in the late 1970s. This isn't the flaking gild of the Golden State or dramatic collapse of Motor City. Thus, everyone overlooks the transformation in order to provide another glimpse of a crumbling steel mill. It's supposed to be a sign of the times.

These aren't the last days of disco.

Rust Belt Porn

I figure most people are familiar the pejorative usage of the term "Rust Belt". The image is one of deep economic malaise and over-dependence on anachronistic industry. These shrinking and decaying cities are stuck in a permanent recession. The stubborn stereotype:

Pittsburgh was devastated by the collapse of the domestic steel industry, but reinvented itself through education and medicine, and has done relatively well in recent years. Local unemployment is now at only 7.7 percent, well below the national average. However, there are limits to Pittsburgh’s recovery, and the city’s many college graduates often move away in search of work.

The current Pittsburgh renaissance deserves an asterisk, but not for the reasons stated. When anyone thinks of a Rust Belt city they include population decline. That's still the Pittsburgh bugaboo, the dreaded brain drain. This is the most persistent element of Rust Belt mythology. It's also the most erroneous.

Here is Youngstown at the bottom of another list (top US cities for business):

In late 2008, Youngstown was deemed by Forbes to be one of America's fastest-dying cities.

"It's not shocking," said Albert Sumell, assistant professor of economics at Youngstown State University. "Obviously, we haven't had good news in a while."

But, he says, the city is showing signs of life. While Youngstown is shrinking in size, it's embracing its smaller future, not just simply expecting it to come back. The city has set up a business incubator that is trying to encourage tech-oriented companies to get started there, and its downtown region is undergoing enough of a renaissance that The Economist magazine recently said it may have turned a corner.

"I think in some ways, our history is worse than our future," Sumell said. "I honestly believe our reputation, nationally, is worse than our potential."

Youngstown does have one Russell 2000 company in its metro area, Stoneridge Inc. (SRI 8.05, -0.10, -1.23%) , a maker of electrical components for cars, in suburban Warren.

But for now, the city is at least in the bottom third in all metrics, the bottom fourth in nine of 10 metrics and the bottom 10% of three. Its growth and job numbers are low, and the city struggled mightily to retain jobs during the past year; it was sixth worst in that metric.

The problem is in the methodology:

We also checked population growth since 2000 and measure job growth against population growth from the beginning of the decade to July 2008, the latest population data available.

In and of itself, population growth isn't a useful way of measuring health. A shrinking city such as Pittsburgh is still being punished for an exodus that happened 25 years ago. That out-migration still defines the city. Youngstown is similarly defined more by its past than the current state of affairs. The legacy costs are staggering. The ranking analysis also suggests the city is a victim of its own geography. The agglomeration economies of larger cities provide them with a comparative advantage.

Many of the metrics used strike me as outdated, a relic of the industrial economy. The booming population of Nigeria doesn't make it an economic power. Despite the loss of people, Pittsburgh is ranked 23rd on the list. So the supposed brain drain becomes the scar on an otherwise glowing review. A Rust Belt city can only go so far, so fast. But that is only a problem if the residents believe it to be true.

Youngstown, believe in Dream City. The measures you see above capture the past, not the future. Take it from someone who still hears the tired refrain, "At least we're not in Pittsburgh."

Myths of Brain Drain

As a Rust Belt refugee, I obsess brain drain policy. This preoccupation has developed into a successful blogging niche. I've been studying this issue for about 3.5 years and I continue to notice a steady flow of false information about a perceived brain drain problem.

A declining population is often used as a surrogate for brain drain:

The other two sectors to enjoy significant growth have been education and health. Yet these fields do not seem to generate the broad-based economic growth needed to boost the overall economy. The region most often favorably linked with the "eds and meds" economy, Pittsburgh, has produced only modest, below-average job growth over the past generation. In fact, Pittsburgh has looked successful largely because the region has continued to hemorrhage its population to other regions, and it attracts few foreign immigrants.

To be frank, the above assessment is bogus. The analysis barely scratches the surface of the demographic story. Pittsburgh did "hemorrhage its population to other regions" back in the early 1980s. But the overall population decline over (at least) the last decade is a result of an aging population dying off and an anemic replacement rate (that does connect to the lack of immigration). Joel Kotkin's claim is wrong and he should know better. I gather he hasn't digested the articles I have written for his website.

Kotkin is in good company. Jumping to brain drain conclusions is the rule, not the exception. Few seem interested in drilling down into the numbers to get a better idea of what is going on in the region. A recent study of rural brain drain is an excellent example. Minnesota Public Radio recently tackled the issue and unearthed some surprising results:

Given this refreshed view of changing demographics, rural America needs to rethink its description of gains and losses. If rural America is losing high-school educated youth (the brain drain) and replacing them with those that at least have a bachelors, isn’t this a Brain Gain?

Indeed, this is brain gain. But Kotkin and others are too busy trying to shoehorn their preferred narrative to notice. The result is misguided policy and government waste, which is ironic given the dominant perspective of many brain drain fear mongers. The rush to judgment only serves surreptitious ends. Brain drain talk is a popular political football. Beware when politicians and pundits invoke the term.

Expatriates in the News

Occasionally, I see a story about someone successful who used to reside in the Greater Youngstown region. In Scranton:

As a senior executive for the Boy Scouts, Mr. LaPolla raises money, organizes new troops and packs, recruits volunteers and scouts. He has worked for the local council for six years, and worked for five years before that for Boy Scout councils in Colorado and Ohio.

"This is my last stop. My wife told me she'd divorce me if we had to move," he joked. "This area to me is thriving ... I'm not leaving here, I love it here and I want to make a difference."

A native of the Youngstown, Ohio, area, he and his wife, Jacqueline, moved to Scranton six years ago and are expecting their first child in February.

"I want to get more involved in politics in the state, with what's going on," he said. "Now that I'm established here in this area, and I'm expecting my first child, I want to make sure our state is on stable financial ground for my child and everyone else's child and their future children as well. Right now, I don't think our state's on that right path. I want to get involved and try to do my best to correct that."

Mr. LaPolla would fit our migration model in terms of ending up in another Rust Belt city. He also has made at least two moves since leaving Youngstown, which makes tracking the Diaspora difficult. I'd bet his first move was to another city in Ohio.

I also wonder if his wife is from the Scranton area. Couples starting a family often boomerang back to the expectant mother's hometown to be near her family. In other words, the trailing spouse is usually male. The better policy approach is to network female talent.

Mahoning River Salmon

On Wednesday, I mentioned the recent NEOtropolis episode about regionalism in Northeast Ohio. I managed to carve out some time to watch the show that night. Towards the end, the panelists briefly discussed "salmon".

Salmon are the people who left the area only to return, among other reasons, for spawning. I gather that the policy wonks are familiar with the boomerang migration trend, going so far as to highlight this demographic as prospective entrepreneurial talent. However, I think the idea was to lure back expatriates who are established entrepreneurs.

The words of the panelists encouraged me. There would seem to be some interest in the boomerang migrant incubator project. I'll remind you of the singular motivation of salmon to travel back to the place of their birth. Channel that energy towards economic redevelopment.

Tim Ryan Hits Home Run

I've anguished over the location of the proposed green energy incubator. In my view, downtown Warren is the ideal place. This would mimic the economic geography of the Youngstown Business Incubator and serve as an anchor for the urban core. Another example is the Greensburg Business Incubator:

Gary Smith, who works in the Kansas office of the USDA, helped plan the Greensburg Business Incubator. Smith says the first step for planners is to ask, "What does the community have that they want to build upon?" In the case of Greensburg, it was the community's shared vision of rebuilding after its disastrous tornado. A traditional business incubator serving as a downtown anchor fit that vision. Additionally, the city was eligible for disaster funding to finance the incubator.

I like downtown Warren, but so much more could be done to revitalize it. A strong city center can do wonders for the entire region. Consider Wooster:

Invest in downtown. Town centers are the communal heart. Too many Midwestern towns let their main streets go to seed. More than anything, this reveals a community that just doesn't care anymore. Who wants to invest in a town with a slum at the center? Columbus, Pella and Wooster look like the good places they are. Wausau may have economic problems, but you'd never know it from its beautifully rehabbed downtown.

Warren is headed in that direction but a recent announcement by Congressman Tim Ryan suggests that this small city is ready to put economic development into overdrive:

The officials said they want to bring the kind of benefits downtown Youngstown has enjoyed from the Youngstown State University’s proximity to the central business district. Ryan said the campus would tie in with the “green” energy incubator being developed in downtown Warren.

“This is the catalyst,” he remarked. In the future, this will be the day that people point to when they ask when did Warren change, he said.

The campus would be located somewhere on Courthouse Square, Ryan said.

That kind of vision is a game-changer and positively plugs Warren into globalization. The ideal location of an institution of higher education is downtown. Innovation thrives in dense areas of face-to-face interaction. Pack it all in as tightly as you can. Let the proposed community college campus house the incubator, introducing students to green entrepreneurial opportunity.

Downtown Warren is now positioned for a jump start. Kudos to Ryan and Governor Ted Strickland for realizing downtown's potential.