Get Behind Go Virginia


Here's something you don't hear every day: so much support for a bill in the Virginia General Assembly that the idea of opposition provokes laughter. According to Wednesday's Washington Post:

After hearing the glowing testimony, Sen. Emmett W. Hanger Jr. (R-Augusta) asked whether anyone opposed GO Virginia — to laughter from the morning crowd of lobbyists and lawmakers.

Of course, as the piece pointed out, there was SOME opposition from -- who else -- Del. Bob Marshall, who joined a small minority of Republicans in complaining that the program would interfere with the free market. "We are entering into the marketplace as a government entity," Marshall said.

Of course, Marshall also thinks homosexuality "undermines the American economy," but his economic literacy is not the point here. Instead, the point is "Go Virginia;" does this program deserve such strong bipartisan support? And is it really such a good deal for Virginia taxpayers? The short answer, believe it or not, is "yes" to both questions.

Basically, Go Virginia is a grant program backed by state business leaders that rewards cities and counties for working together on economic development projects. The bills that create this program set up a matching grant fund to jump-start such projects, and also a board that helps ensure that localities share the resulting economic development benefits.

Why is this so important? Regional cooperation is the magic bullet that solves a fundamental problem in local politics. Back in 1981, political scientist Paul E. Peterson pointed out that cities and localities are actually engaged in dramatic competition with each other. The prize: "export" businesses that sell products and services that bring in money from outside the locality. Small businesses like grocery stores and dry cleaners are fine, but the best kind of economic development creates high-skilled jobs funded by customers from elsewhere.

This is why city and state leaders Virginia worked so hard to bring in Stone Brewing or new jobs from tech companies like Shift. Already established business can -- and do -- complain about the incentives offered to lure these new players, but it's a sound practice that benefits the locality. Stable jobs create stable employees who pay taxes and don't draw on too many services - a net gain for cities and counties. (And this gives these localities the resources to take care of their less fortunate citizens with services like homeless shelters and food programs. Otherwise they may literally try to literally drive the poor into neighboring areas.)

In other words, cities and counties -- and, to some extent, states -- are playing a zero-sum game; if another locality gains a business, then they lose. That's why you get what the Washington Business Journal calls "a heated competition" between Maryland and Virginia to host the headquarters of companies like Bechtel and Marriott. Back in 2013, Texas even ran radio ads in California to explicitly lure businesses to the state. This kind of competition is just as heated among localities within a state, and leads to tensions between neighbors over which residents are served by which services. (Stadium financing almost always revolves around this question; just ask the Richmond Flying Squirrels.)

So how do you solve this problem? Regional cooperation. Cities and neighboring counties can work together to bring economic development to a region with plans to share the economic bounty. And that's exactly what Go Virginia proposes to do.

Virginians have very good reasons to be skeptical of the solutions offered by business leaders and corporations. (Coal ash, anyone?) But in this case (and maybe JUST this case), they're definitely on to something. Regional cooperation is one way to ensure that cities and counties aren't always actively working against each other. (Even if it's probably too late to help Nutzy.)