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Economic Development is . . . (increasing the flow) of capital through the community and reducing its leakage.

Stop Horsing Around

Paul, a jogger, is running down a country road and is startled when a horse yells at him, ‘Hey-come over here buddy.’

Paul is stunned but still runs over to the fence where the horse is standing and asks, ‘Were you talking to me?’

The horse replies, ‘Sure was, man I’ve got a problem. I won the Kentucky Derby a few years ago and this farmer bought me and now all I do is pull a plough and I’m sick of it. Why don’t you run up to the house and offer him $5,000 to buy me. I’ll make you some money because I can still run.’

Paul thought to himself, ‘Wow, a talking horse.’ Dollar signs started appearing in his head. So he runs to the house and the old rancher is sitting on the porch.

Paul tells the farmer, ‘Hey man I’ll give you $5,000 for that old broken down nag you’ve got in the field.’

The farmer replies, ‘Son you can’t believe anything that horse says. He’s never even been to Kentucky.’

Paul’s story reminds me that often people begin to focus on the wrong thing when they think about our economy. When in reality we all need to focus on the basics to move our economy ahead. I have said this before but it is worth repeating — The way to think of our economy is to imagine our economy as a funnel with money (capital) flowing into the top as well as money filtering out the bottom.

The funnel analogy represents a number of key concepts. First, we in Tama County are linked with the rest of the world through the inflow and outflow of income and goods. Second, we use resources to produce the outputs that we sell. These resources can be available locally or purchased elsewhere. Third, the size of the funnel (our economy) is determined essentially by the inflow of capital and the lack of money leaving (leakage).

Let’s talk about economic leakage (money leaving the county) for a minute. Everyone knows we recently had one company invest $50M in our economy (Iowa Premium Beef). One very obvious leak occurs when the people employed by this company live outside of our county. This is happening. It is happening because we don’t have enough quality housing for the newly hired employees.

I realize that many of you have lived here in Tama County for many years owning a home and never needed to look at the current rental market (why would you – you own a home). So you are completely unaware that even before Iowa Premium Beef opened we were very short of rental housing. In fact it has been a very tight market for years based on the fact that every year newly hired teachers continually struggle to find a place to rent when they are hired to teach at our schools.

Acknowledging a problem is often viewed as the first step to recovery. We have worked incredibility hard to direct this capital into Tama County and now it is critical that we stop the leakage by creating opportunities for developers to come build some much needed housing.

The next step will be for the people of Tama County to realize that they have to actually become involved. If you live here, you are involved. Everyone reading this article has the opportunity to attend your city council meeting and express your opinion that we need to do everything we can to create quality housing here in the county. All Tama County residents are STRONGLY encouraged to support the new housing developments that will be brought to the councils in the coming months.

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